Anonymous asked in Business & FinanceInvesting · 4 weeks ago

Is trading massive quantities of cheap stocks legal?

Such as buying like 1,000,000 stocks at 50 cents a share during a down cycle, and selling those 1,000,000 stocks the next day at 60 cents a share at a peak, making 100,000 profit (not taking into account exchange fees)?

8 Answers

  • 3 weeks ago

    Illegal no, going to happen not likely at all.  Plus your going to need the full half million in your account, as sub $1 will almost assuredly have the full boat equity requirement. Far more likely you'll catch a 50 cent bid, the stock goes no where and you have to bail at a 40 cent ask. 

  • 3 weeks ago

    Yes, If you have $.5M to buy the shares.

  • 4 weeks ago

    Yes, but where are you going to get $500,000 to pay for 1,000,000 shares at 50 cents a share?

  • 4 weeks ago

    It's perfectly legal although you would need $500,000 cash upfront in your brokerage account to purchase these 1,000,000 hares @ .50 each. And, if that stock dropped to .40 instead, you'd face a loss of $100,000.

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  • Judy
    Lv 7
    4 weeks ago

    sure it's legal.  But good luck making that happen.

  • 4 weeks ago

    Yes it's perfectly legal.

    BUT - do you have $500,000 to put up ?

    Problem - in the real world, it would be hard to find buyers, especially in a down market.

    There is no exchange fees on stocks that trade OTC.

    Customers ARE NOT charge "exchange fees" on stock transactions.

  • Bill
    Lv 6
    4 weeks ago

    If you have $.5M to buy the shares with, yes.   

  • Anonymous
    4 weeks ago

    You can find many ways to lose your money. And you WILL lose your money.

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