Just some light reading for anyone contemplating Cheapies
More Reasons to Have Caution
In addition to their inherent risk, penny stocks are notoriously subject to scams. In “pump and dump” scams, someone buys shares of very cheap and thinly traded stocks and then hypes them up through advertisements via email or social media, only to sell the shares quickly after seeing share prices rise. In some cases, these companies have been found to be nothing more than the dormant shells of bankrupt firms. 6
The Financial Industry Regulatory Authority (FINRA) says that investors should be on the lookout for companies that were dormant and then came back to life, as well as firms that had numerous changes to their name or business focus. Unusual reverse stock splits are also a red flag, according to FINRA
AND. The Hair should have been a Red flag but it was too obvious, so we ignored it! haha
