Thanks in advance for taking this question.
In your blog I found a section under Penny Stocks:
"No Penny Stocks: Penny stocks do not come within the purview of Graham's framework either; as their only discerning feature is their low price, and that presents no indication as to their underlying value."
However, when I screen for "NET-NET" stocks, the majority of the top picks (highest iv%) are in fact penny stocks.
Why are these not filtered out and if you were to manually, what is the USD cut-off? Anything under $1?
Thank you.
Stocks Discussed:
Submitted by Tooms. Created on Saturday 12th March 2022. Updated on Saturday 12th March 2022.
Blog Updated
Dear BobT,
Thank you for your forum post!
The blog post on Cigar Butts, where that has been mentioned, has been updated to give a more complete explanation. That statement was meant to indicate that a Penny Stock would not be a valid Graham or Value stock simply by virtue of having a low price alone.
So naturally, there is no cut-off price on GrahamValue either. Incidentally, the SEC now defines Penny Stocks as anything selling under $5.
Thank you again for your forum post!
Penny shares are traded (over
Penny shares are traded (over-the-counter)
You can find out by entering only the arrow and then selecting (About stock)
Then Market Identifier Code (MIC):OOTC
OOTC= Penny
Also, it's not bad. Amazon was a penny stock
I think penny stocks only need experience but I'm not sure about it
OTC and AMZN
Dear Omar_H,
Thank you for your comment!
You can find Over-the-counter (OTC) stocks on GrahamValue's screeners by simply entering OOTC in the Search Keywords field.
The all-time lowest closing price for Amazon.com Inc (AMZN) was indeed $0.07 on May 22, 1997, but this is only after adjusting for stock splits.
Amazon has never actually traded under $5, which is the SEC definition for Penny Stocks.
Thank you again for your comment!