That's why people avoid low volume stocks. Besides true long-term investment purposes, they're not worth trading because of the lack of liquidity.
yes - it would be very difficult to sell two million shares at $0.05. This would be a $100,000 transaction. When you buy the stock at $0.0001 - you're investing $200.00.
So you are asking how easy is it to turn $200 into $100,000? Very very difficult. People who can invest $100,000 are going to research the stock and find that it has little to no value. Most penny stocks trade at fractions of a cent for a reason - they are just part of a pump and dump scheme built around a shell company with vague plans and little cash.
I have seen several stocks do this based on historical info.
I do not think for a second all or most would.I am not asking how easy is it to do that and I do not get why you assumed that.
I want to learn about the volume with them.
Explain why it would be very difficult to sell that many?
There are 3 problems with your stratergy.
1). While you can buy as many as you can afford you can only sell a number close to or within the Normal Market Size (NMS ), the average daily volume of shares traded.
2). For a tranche larger than the NMS , a lower than quoted bid price will have to be accepted.
3).Because of often large spreads, stellar rises can easily be wiped out and even return a loss.
Say I buy 2 million shares of a penny stock trading at 0.0001 and it reaches lets say 0.05 a share and I want to sell it.
Now I have seen stocks that have done this but my question is will it be very difficult to sell all 2 million shares at once?
I knew a guy that said low volume stocks are a waste of time since you can't be filled to buy or sell easily so he avoided them.
I want to try something like this since it is cheaper but highly risky and most likely very slow but if I can't sell them all once I make money that would suck.
