Watch out for the Hot Tip

In almost every instance that I have lost money on penny stocks it has been because of a hot tip. They can be seductive - and if given by an apparent authority such as your broker, can be very difficult to turn down. There are actually professional promoters who make a very good living generating and nurturing rumors about some penny stock that’s guaranteed to go through the roof. The entire concept hinges on the rumor being spread from person to person, at the office, over the phone, or at social venues. The promotional ploys can be very costly for investors who get involved without special knowledge about the company or the actions of the promoter. In most cases if a stock really is going through the roof you won’t hear a word about it, because a select few individuals will be very intent on keeping the information to themselves. Run away from hot tips. genuine hot tips are taken up by those close to the source long before you get a chance to get involved.
Kevin Bauer
http://www.stocktradingresources.net