The problem is, some of these sources aren’t reliable and are only trying to get you to buy into a particular stock because it will benefit the people behind the pressing. I get these full color newsletters all the time. Almost always, these are OTC or Pink Sheet stocks that trade under $10. Most trade far under that, even going sub-penny (never a good investment).
An example of this came in the mail in 2006 hyping a company called Lyric Jeans (LYJN). This is a company started by a singer/songwriter living in New York who had the idea to create high end jeans with printed lyrics on them. Ok, a novel idea, not a real great one but something that hasn’t been done before, fine.
Here’s the problem. Look at the 2 year chart…as the company is only 2 years old.
The stock has never traded above $1 and is a straight line down. Initially, it IPO’d at $.40 cents, quickly shot up to near $1 which is when I suspect the massive PR blitz went out, and it’s been a downhill ride ever since. Word to the wise: steer clear. What I resent about this kind of marketing and PR is it looks legitimate but it only serves to hype the stock for someone else’s gain. You should never blindly accept what you read somewhere as truth.
Be diligent, do your homework and if you are going to trade penny stocks like this, make sure you understand the chart before you speculate.
