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The Secret World of Stocks Selling From a Penny to $10 a Share

by Fred Carach

Pub Date: Dec. 17th, 2019
ISBN: 978-1-67674-617-1
Publisher: Self

Financial advice from a longtime investor focuses on stocks that sell for less than $10 per share.

For investors who want to buy individual stocks, Carach has an intriguing proposition. Why not consider cheap stocks rather than the more common blue chip ones? A former real estate appraiser and lifelong investor who wrote Forty Years a Speculator (2007), the author calls stocks selling for less than $10 per share “the most ignored and detested sector” of the market—but this has not stopped him from pursuing them for decades and making a tidy profit. For the first 100 or so pages of this book, Carach shares his observations about the market and his “conviction-contrarian” philosophy of investing: buying low-cost stocks “when they are being hammered into the gutter” and holding them for “at least two to five years.” This early material provides intriguing insights into how the author invests, but it is unevenly written and highly repetitive (a fact Carach acknowledges; he apparently collected previously penned articles and included them as chapters). The second half of the book moves from the general to the more specific as the author delves into several market sectors, including mining, oil and gas, high tech commodities, gold and silver, and real estate investment trusts. He assesses some of these sectors as well as the American economy in blunt style; for example, he asserts, “The next chapter in the history of gold and silver will be written in Asia where it is adored and not in the west where it is scorned and regarded as a barbaric relic.” Carach lists some of his favorite stock picks with only spotty details about them. Readers may, of course, regard these choices as recommendations, but he cautions investors to do their homework: “Research your stocks before and not after you buy them. Diversify broadly, no more than 5% in any position, and the riskier the play the less of your money should be in it.” While some of the prose seems amateurish, the author’s unorthodox investment advice may spark serious interest.

A wily stock market strategy presented in an informative, if somewhat muddled, manner.