To OTC Journal Members: 
 

Thinly Traded Stocks

While it's nice to see volume in the penny stock arena, it's panicked markets like yesterday when it works against you. The more short term traders you have in a stock, the worse it will trade when everyone is petrified and running for the exit door. The more thinly traded stocks with loyal shareholder base's hold up better.

Take Midas Medici (MMED)- the weirdest stock I've ever seen. My first feature on the company was on June 12th. Since the stock had never really traded publicly, and it was bid $2.02, offered at $2.60, and trading no volume.

If there were a Top 10 events in micro caps like there are Top 10 plays in ESPN, this stock would have gotten it. The next day, after publishing my report, the stock traded ZERO volume. It wasn't that no one wanted to buy it. There were bids for the stock at $3. Market orders might have taken the darn thing to $20. I cautioned to use a limit order.

Not one single share was for sale. Since then it has loosened up a bit, and there are a few shares around. Yesterday, MMED traded 27,000 shares- the highest volume day yet. Of course, with the DOW down 600 points, the stock got hammered.

But wait- MMED actually went up yesterday. Imagine that! Today it has traded over 17,000 shares and is well over $3- $3.38 at last trade. That's up from the original $2 starting price where you couldn't buy it anyway, and amazing considering this bipolar, schizophrenic market.

MMED's latest acquisition puts it over $85 million in annual revenues, so it's just a question of time until this gets discovered.

Lesson learned- sometimes thinly traded stocks can be a safe haven in a bizarre world.

And, speaking of thinly traded stocks, tomorrow morning before the open I'm going to answer the question- how are we going to feed the Mars Colony? Stand by.

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