With SEC rules only allowing cash account's to trade with the proceeds of a stock sale after three days,
    penny trading can be frustrating.  Without being able to trade them on margin easily in the U.S., its really not
    worth getting a margin account.  This way you won't be tempted to use margin, as we do not recommend it,
    just as we would not recommend trading with a credit card.  Our strategy rarely has problems with this rule
    by always having cash coming available and looking for longer time horizons than a day or two.  Although
    we don't agree with this rule we think it can help slow us down and think things through a little more.

Partial fills can be a frustrating part of trying to manage your own stock portfolio.  The worst part is to see
only 5000 shares of a much larger order being filled and watch the stock run away on you.  If this happens
do not pull the rest of you order and chase it.  That is exactly what they want you to do.  Sit tight and wait for it
to come back down. If it doesn't you've still made a profit and if it does you get that price again with no extra
commission.  Try not to be to concerned about the extra cost, however, if the stock appears to be weaker
than when you bought it.  Be prepared to pull your order if you see the price barreling down quicker than the
last time.  Then you'll be happy you only got 5000 shares on your first try.

Try not to incorporate commissions when figuring your portfolio.  This will allow that must be taken out of
earnings.  Put away $100 or so a month for this and do not incorporate it into your account.  Not selling or
buying something because you couldn't get an extra penny to cover your commission is unacceptable.  
Think of it as a monthly bill that you are going to have to pay no matter what.

           If you have been caught up in a trade minimum per quarter or month and need to make a few trades
    under a time limit in order to save a few hundred dollars, then you should go ahead and make them.  
    Hopefully you have some cash available so don't try to sell anything you already have.  Instead look for high
    priced stocks with tiny spreads to trade.  This will keep any losses at a minimum.  Also look for highly liquid
    stocks so you can get in and out almost instantly.  Don't forget about the day traders rule so break your
    cash down appropriately.  Also, a viable option to beef up your trading when needed is to sell a stock that
    you are down on, and then immediately buy it back.  This will allow you to take the loss on your taxes, which
    may more than offset the cost of the commission.
    How to Deal With Rules
    PSW Staff
©2010 Penny Stocks Weekly  -  Home  -  PSD 10  -  Terms  -  A Message From The SEC  -  Important Information On Penny Stocks
Free, unbiased analysis & opinion on small & micro cap stocks
You need Java to see this applet.
    Enter Symbol, Company Name or Keywords:
    Strategy Desk
    Full article access includes Buy, Sell & Stop-Loss conditions along with a no nonsense
    trading strategy.  Don't jump in blind, subscribers also get a detailed risk analysis,
    suggested position weight and time horizon ideas.  Also access our Small & Micro Cap

    Get started for free right now with our weekly newsletter.