VIDEO ON MSN MONEY
There are ALWAYS reasons why a stock sells for less than $5. None of them is ever good. Not to say there are not turnaround stories possible, but you should always be questioning such stocks.
At one time you pretty much had to avoid buying odd lots of stocks (less than 100 shares). Today you can easily and cheaply buy 10 shares. So gone is the reason some used to shop low priced shares.
And low priced stocks trade on fundamentals like all stocks, so a higher priced stock is as likely to rise at the same percentage as a low priced stock. And perhaps given my first point, higher prioced stocks are actually likely to do better.
One word for Tea Party believers in oil: TESLA. Electric cars are the future, oil and nat gas will be exported when we are weaned off of it. Teens dress like hobos nowadays. Clothing retailers are dying. Office Depot is an overpriced copy shop. I buy everything else off the internet from HP website or Amazon. All bad choices.
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China's Alibaba is expected to hit the market as soon as September in possibly the biggest tech IPO ever. Will you buy in?
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- I'll do whatever I can to get shares on Day 1.
- I'll buy later, after the hype dies down.
- Maybe next year. Chasing IPOs is too risky.
- What's Alibaba?