It’s been a while since I’ve posted on a trade. I’ve been waiting for something that looks really promising which I hadn’t really found until now.

I liked the numbers at DEO and still think it’s a good investment but only if you can afford a big stake in it. That being said, where do you go if you don’t have a lot of capital to put into a trade? Penny stocks.

While it is true that a lot of penny stocks are frauds disguised as legitimate businesses, there’s one that stands out for me because of their actual product.

Platinum Studios, INC. (symbol: PDOS.OB) is a comics-based entertainment company that owns the rights to thousands of characters, plots and IPs. Currently in production for a major release in 2011 is “Cowboys & Aliens“, directed by Jon Favreau (Iron Man, Iron Man 2) and starring Harrison Ford, Daniel Craig, Sam Rockwell and Olivia Wilde. Steven Spielberg is producing.

The story revolves around an alien ship that crash lands in a Silver City, Arizona where Apache Indians and the local Western settlers team up to defeat the alien threat.

Now why buy a penny stock of a company that owns the rights to the IP (Intellectual Property)?

Let’s go back in time to 1977. Then a fledgling film maker named George Lucas decided he was going to make a science fiction movie called Star Wars. The studios that were distributing this film expected it to be a complete flop because they didn’t really understand the material, the technology or the production behind it. Lucas made a very wise decision back then. He agreed to allow the studios to distribute his film under one condition; That he retain the rights to all merchandising. The studios agreed and as they say, the rest is history.

Now, I’m not saying this film is the next Star Wars but Jon Favreau doesn’t just jump into any project. He’s a very passionate director and only involves himself with things he truly cares about.

Cowboys & Aliens, if it does well (and by all accounts so far is becoming very popular) then the merchandising from this big budget Hollywood Sci-Fi blockbuster could mean big things for Platinum Studios. What does that mean for a stockholder? It means you could see your investment double, triple or quadruple your return by next Summer. Of course it also means you could see your investment completely tank if the film is horrible.

I have a feeling though, with the cast that has been chosen and the director attached that we are going to see something spectacular.

As i’ve said before, penny stocks are speculative by nature and you should be willing to lose your investment completely so just keep that in mind.

Disclosure – I own shares of PDOS.