Can someone explain the point system below a dollar in the stock market?
Posted Sunday, April 11, 2010 by admin
Hello,
I’m reading an ebook on penny stock trading & having trouble understanding how to understand the “points” in regards to where it stands in relation to the dollar.
For instance, here is a link to the book I bought, & a few inches down there is a pic of a graph http://www.daytradepennystocks.com/?hop=0
& it starts out at .0025, but quickly goes up to .0300 Would that first one be a quarter of a penny & the last one $3.00?
How did you mathmatically arrive at that?
.0300-.0025=.0275
it’s all about percentages or ratios. That’s an 11x increase!
if a stock is at .0025, it is a quarter of a penny per share, exactly what it says $0.0025. .03 is 3 cents.
Nope, that’s a 1/4 cent to 3 cents
In other words (and this makes it easier to work with) you could buy 1,000 shares of the stock @ $0.0025 (or ยข 0.25) for a total of $2.50 (plus commissions, etc). Then, you would have sold those 1,000 shares of stock at $0.03 to get $30.
Good luck with daytrading those penny stocks!!