Shorting Penny Stocks... 08/27/2011
There is a recent promotion which tells of an "amazing opportunity" in the oil and gas business. The promotion tells you to "buy this stock now in the $2 to $3 range and make $36,000 off only 2000 shares. A ten bagger for sure!!!" The email and mailer brochure tells how this unknown oil and gas player is sticking it to the big players because they were able to pick up huge reserves for nothing. It mentions the hot buzzword "bakken" about a hundred times (because that is the hottest phrase in oil and gas at present). Then when you get to the disclaimer of this glowing report it tells you that a third party is paying $125,000 for the promotion. The stock being promoted is LOGL - Legend oil and gas. The stock has started perking up again on heavy volume since this new promote started about 2 weeks ago. As it loses steam, the stock will more than likely dump (I have never seen a paid promote succeed long term). I am starting a short position in LOGL. I expect this promote will end exactly the same as the 1000's of others over the years... BTW - if you want a real junior explorer that is teaming up with Brigham Exploration in the Bakken, look at my favorite ESTE Earthstone Energy. Their last well, which they have a 4% stake, just hit for 3,900 barrels a day initial production. Disclosure: Long ESTE - Short LOGL CommentsLeave a Reply |
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