I get this question sooooo much, it's time I had my own forum post about it...because I short sell hard-to-borrow penny stocks. Yes, it's legal, you can short stocks under $10, under $5, under $3, even under $1 (although I hate shorting stocks under $1/share due to upside risk)...just gotta find brokers that have shares to short.

I know this is a strange strategy to many people, but its help me turn $12k into $2 million in 4 years (1999-2002), become the #1 ranked short bias hedge fund (2003-2006) and now the #1 ranked trader out of 40,000+ on Covestor (2007-2009)...learn the strategy at http://www.timothysykes.com

I use and recommend Thinkorswim (I'm also an affiliate because I love em the most out of any broker...they had shares to short of true carcass companies (whose stocks surged due to promotional mailers and emails being sent out) like AENY &EMGE and their customer service is tops. I also use Interactive Brokers & Sogotrade

http://www.investimonials.com/brokers/reviews-thinkorswim.aspx

http://www.investimonials.com/brokers/reviews-sogotrade.aspx

http://www.investimonials.com/brokers/reviews-interactive-brokers.aspx

as they sometimes have shares to short of these stocks too, but both customer services aren't up to Thinkorswim standards...and as I write this, I am not their affiliates because neither of them will even get back to me about joining their affiliate programs!

Here are some basic posts I and others have written to help you learn how to short sell horrific penny stocks:

http://club.ino.com/trading/2009/06/short-selling-penny-stocks

http://www.timothysykes.com/2008/06/how-to-reserve-shares-to-short-on-hard-to-borrow-stocks

http://www.timothysykes.com/2008/09/is-thinkorswim-now-charging-fees-on-hard-to-borrow-stocks

http://www.reapertrades.com/2009/09/how-to-borrow-shares-to-short

http://www.timothysykes.com/2009/08/how-to-short-sell-hard-to-borrow-stocks-via-td-ameritrade

Tim

great post Tim, proud to be working on Investimonials with you

Gregg

Thanks for posting this Tim. I'll say from first hand experience that having all 3 of those brokers have been key to me making money with your strategy. I even divided up my $25k trading account with 1 broker to open a Sogotrade and Interactive Brokers account so I could find more shares to short when the plays come up. The Sogotrade account alone has gone from $5000 to $7100 in 30 days. Having 4 smaller accounts (I also have a SpeedTrader account) has proven much more beneficial than 1 large account. Even though I'm now under the Pattern Day Trade rule.

Cosmo

Yes, great post. Very informative. I`m just in the process of opening an account with Thinkorswim and i`m really looking forward to start using it.

Barracuda

I have good ideas on recomended Brokers for penny stocks. Your advice is very good to implement in business..

http://www.pennysinvest.com/

AltonDelmote

Yes I know this is a strange strategy fpr many people, because its help us turn $12k into $2 million in 4 years .

http://www.beststockreport.com/

MichelJohnson

You stupid spammers, you put your shady promoter websites on this post and we're just gonna short your shitty picks! Give us some pumps worth shorting you wannabes

DaleelaFarina

TIM, YOU´RE THE KING OF THE KING IN THIS ART.............................

Carvan

I make money on shorting pump and dumps at their spike which usually occurs about 45 minutes after mkt open the morning after many newsletters all hyped the same stock the prior evening and got paid for it (per their disclaimers).   Always check charts and financials but usually obvious pump and dump.  Hard to catch that (about) three minute extra 30% buyer desparation spike just right and hard to find stock if cheap.  Only find maybe 10% of the time.But double your money in a few hours as stock goes down as fast it goes up.   MORE money to be made on probable pump and dumps in the making.  Could fall apart or just go bust on dump day.  Accumulating NTMG right now as an over the top pump and dump.  They have spent millions hyping it since March. Will have to get it to $10 a share to break even!   100% gamble so don't bet much.  But a shot at 200 times gain, worth it. I always have a few super long shots betting low dollars. Like Fannie Mae stock and Yellow Freight.Stocks down 99%.Will Obama let Fannie Mae go under? No one following YRCW so they all missed annual mtg, mgt change, raising much cash, huge cost cuts, settled with unions and so on. Still a total gamble.  IB tends to have the most penny stocks to short.

W0tm

Stock promoters there like clowns, always need to make us laugh with their stupidities LOL !!!

Stop wasting time here, your time is valuable to promote your POS Co's they are paying you to get thte job done :)

so please go Promote so we can Short those wannabe's

Maxshocker

Please no spam in the forum.

DannyCaliOc