Investing in Microcap stocks can be rewarding both financially and in time spent especially when using Microcap Millionaires advice. The key to making the most of your investment is research. And it need not be an exhaustive process. By delving deeper into the background and future of a company you are looking to buy into, you can seriously hedge the odds in your favor. But there has traditionally been a problem with this.
The main one is how the stock is traded. If the company floats its stock on The American Stock Exchange or the NASDAQ then it is a relatively straight forward task. Since all of the publicly traded companies are known well up to a point and most probably have a track record. It isn’t too hard to find the necessary information on these companies.
But what about those stocks held by companies that trade Over The Counter?
These , often those recommended by Microcap Millionaires, companies that don’t file financial information with the SEC can be hard to pin down. It has been known in the past for dubious parties to either inflate the value of these stocks artificially. Or in some circumstances even commit fraudulent activity to artificially sell stocks at a greater value than they are technically worth.
Your first port of call would of course be the Pink Sheets and OTCBB. Here you can check the companies basic information and the price they are asking for shares. If the company has more than $10 million in assets or 2000 investors, they they are required to file financial reports with the SEC. Although once again, “cooking the books” has been seen on a regular basis and is being stamped out across the board.
Once you have the information you require from the financial regulation bodies. Then you can do similar research on your own. In the information age, it is fairly straight forward to hire a researcher or a Virtual assistant. They can perform a series of searches online and compile together a hit list of basic factors that can help you make an informed decision about your potential investment.
Some things you should cover are:
Has the company been in the news? A simple Google News search of the company name or its trading name should flag up any positive/negative press. If the news is negative then why is it? Has the company shut down any of its operations?
What does a Google search say? Just a simple straight forward Google search can flag up anything from the companies head quarters being built. To an employee suing for an accident in the workplace. It can also provide you with location information. And you can check the companies headquarters on Google Maps. To see if the surroundings fit with the financial reports being filed with the SEC.
Research and due diligence is the key.