7 year old makes million(s) on death spiralling penny stocks
03-13-2015, 11:01 AM
He left the penny stock game for the most part, is renting two floors on 40 Wall St...I'm guessing that rent is ridiculously expensive. Penny Stocks are 1/12th of his business now he says. Hes trying to become a music and entertainment mogul.
This article and how he committed the scheme should never have been made public. I guarantee you based on this information going public there are now dozens of more people doing it.
I don't get why people are talking about how hes taking a big risk of the company being worthless...a lot of these companies will go all the way down to shares being valued at 0.000000000001. He can still sell at that price. He gets the shares at the price on the day he converts the debt so he locks in a 40+% discount on shares. It's not as if she shares become public knowledge via an equity offering which would lower the price. When you unload so many shares at a time you are going to drive the price down typically, depending on how big the company is. So on the first $10,0000 in shares he sells he may get 45% profit...the next $10,0000 42% profit...the next $10,000 38% profit and so on. He basically almost guaranteed himself a way to make a massive return. When you are doing 40+% on many deals it's hardly important if 1 in 10 of the companies go completely belly up and you lose all your money.
Penny Stocks are targeted by a variety of scams simply due to the fact that it's much easier to control the market than with Bigger companies. Smaller scams involve people hyping stocks, often all over message boards to drive up the number of buyers and subsequently the price. Meanwhile, the people who are hyping them up already own a sizable amount of stocks and they unload it shortly thereafter.
If you read the article the companies that are massively devalued still get called all the time by other companies trying to do the same thing Magna did. It's 100% sleazy but I'm not sure whether he broke the law or not. If he broke the law then we may very well see him forfeiting his assets. If not, then the guy with a little reasonable investing / business acumen will likely one day become a billionaire due to having so much money already at such a young age.
I'm curious if one could turn a big profit simply shorting all penny stock companies with a low price and high trade volume.
This article and how he committed the scheme should never have been made public. I guarantee you based on this information going public there are now dozens of more people doing it.
I don't get why people are talking about how hes taking a big risk of the company being worthless...a lot of these companies will go all the way down to shares being valued at 0.000000000001. He can still sell at that price. He gets the shares at the price on the day he converts the debt so he locks in a 40+% discount on shares. It's not as if she shares become public knowledge via an equity offering which would lower the price. When you unload so many shares at a time you are going to drive the price down typically, depending on how big the company is. So on the first $10,0000 in shares he sells he may get 45% profit...the next $10,0000 42% profit...the next $10,000 38% profit and so on. He basically almost guaranteed himself a way to make a massive return. When you are doing 40+% on many deals it's hardly important if 1 in 10 of the companies go completely belly up and you lose all your money.
Penny Stocks are targeted by a variety of scams simply due to the fact that it's much easier to control the market than with Bigger companies. Smaller scams involve people hyping stocks, often all over message boards to drive up the number of buyers and subsequently the price. Meanwhile, the people who are hyping them up already own a sizable amount of stocks and they unload it shortly thereafter.
If you read the article the companies that are massively devalued still get called all the time by other companies trying to do the same thing Magna did. It's 100% sleazy but I'm not sure whether he broke the law or not. If he broke the law then we may very well see him forfeiting his assets. If not, then the guy with a little reasonable investing / business acumen will likely one day become a billionaire due to having so much money already at such a young age.
I'm curious if one could turn a big profit simply shorting all penny stock companies with a low price and high trade volume.