Do yourself a huge favor and only put a little of your money in OTC stocks.
Be very wary of the hype put out about these stocks. Companies like CNOA
and AWNE are rare gems, but even they suffer from a lack of interest from
the big funds, which slows their potential growth.
Companies trading in the $10-30 range are usually on every fund manager's
investment scopes. One piece of good news can drive those stocks through
the roof, as is what happened with ENER this past week, when it jumped
from 34 to nearly 50 in one day. Better to own ten shares of a stock like that
than 10,000 shares of a penny stock that loses half its value in a day.
Keep away from pharmaceutical stocks. Between unexpected developments
among the competition, FDA approvals (or denials) and possible lawsuits,
they're worse than playing the lottery.
Solar and wind stocks are soaring at the moment. Soon they'll shudder to a halt.
They'll drop and later go up again. NCEN is a good cheap wind stock. All the
solars are good, but they're going up fast. SOLF is way down and a good buy
and is rising steadily but still low compared to its peers (only because it was
oversold earlier).
ABP is a good cheap oil stock.