Robin Hood has brought about stock trading like never seen before, with everybody now rushing into the stock market trying to make a quick buck we have seen a lot of volatility and when I say a lot I mean it, we have seen stocks go from 300 to 2000 in 5 months and that is not even the start of it. So is it a scam ? the short answer is no however depending on the stock there is a possibility of you being scammed through what is known as manipulation, some methods include a pump and dump where one buys a stock to increase it price then other buyers jump in and he then sells all his shares to crash the stock, this is usually seen in penny stocks which are typically very cheap stocks with low volume which allows for easy manipulation by very wealthy people in any event you can make a lot of money on the stock market if you know what you are doing, I have seen people turn 500 into 12000 so it is very real. I will offer a couple of tips here on how to avoid pump and dumps etc
Pump and dumps is a really dirty tactic investors use and it happens some what often the best way to avoid it is by using level 2 market data, here you look for support at certain levels this will prevent you from falling victim to pump dumps if you have low volume in the first 10 rows and all of a sudden you see 10k shares at the current price then chances are this is a pump and dump and it will crash lower than where it is now. I have fallen guilty to pump and dumps before but that was due to my own ignorance it occurred on apple I didn't think a stock such as apple would be prone to a pump and dump but I was surely mistaken. it ended up costing me 3 thousand dollars due to the fact that I invested in options which is a high risk high reward trading strategy.
Sometimes in manipulated stocks you will see high support for one region then high resistance in another for example someone looking to by 50 thousand shares at 1 dollar and someone looking to sell 50 thousand and 5 dollars, this is a classic manipulation technique and if you want to make money on it you could buy at 2 dollars before it falls to 1 and sell at 4 dollars making a profit of 2 dollars per share.
During my last 6 months of investing I have discovered several golden rules that should help ensure your success, Rule 1, never buy at the end of a bull run, Rule number 2 Never sell at the end of a bull run. rule number 3 always check market data before purchasing, rule number 4 never let your emotions get the better of you, rule number 5 Do your research, rule number 6 Do not listen to the morons on stocktwits most of them have not even been investing for 2 months take what they say with a grain of salt trust me, click on there profile to see how much experience they have. rule number 7 never invest more than you are willing to loose, rule number 8 Stop loss at a profit and rule number 9 don't put all your eggs in one basket
How much money could you have made ?