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If you decide it is YES... Recommended Investment Plan Never risk more than you can afford to lose! Never invest on these stocks at margin. Always be on cash-basis. Be prepared to hold your position for a very long time. Thus, do not invest money that you would have some need for, like payments for amortization or tuition, or worse, grocery expenses. In fact, only invest money that you can immediately write off (like having gone to a casino and losing it all!) without worry or concern. Invest in a basket of 8-15 stocks, depending on the size of your expendable funds. This way, even if only one hits the big score, you would have made money (hopefully a BIG PILE OF MONEY!) on your entire investment. And if these mini-pennies are too risky for your taste, consider the penny stocks of established companies in telecommunications, power distribution, banking, construction, etc. These are PHILIPPINE BLUE CHIPS whose stock prices had been ravaged by the currency devaluation and by the general loss of confidence in the Southeast Asian region!

Read my Disclaimer!

MINI-PENNY OR PENNY OR SPECULATIVE STOCKS have always had an appeal to the more risk-tolerant investors. Like the gold-rush prospectors of yore, these speculators are willing to risk losing it all in return for the chance of striking it rich (making them more gamblers than investors!).

In the Philippine stock market, some of these mini-pennies had delivered on their promise (see table below). Atok-Big Wedge's B-shares (ABB), a mining company, rose 1.25 MILLION PERCENT between 1984 and 1997, with the recent surge arising from rumors of a big property development project. Lepanto Consolidated (LC/LCB), records number 23 and 36 in the table, discovered a new gold mine in 1996, helping its stock price to increase by 1,600% to 2,400%.

There were other examples. Many of these were oil and mining companies trying to ride the 1992-1996 economic boom in the Philippines by changing themselves into property and holding companies. This exercise had since then been in trouble, with hefty losses for investors who got in at the wrong time. ABB was 74% off its high-that is, if buyers could be found at all.

No commercially exploitable oil and gas deposits had been found the last several years. This discouraging result, coupled with the difficulty of raising capital and the very high interest costs now prevailing, had reduced exploration activities.

Thus, the table below shows not only the possibilities for profits but for losses as well. But consider the present situation, not only in the Philippines but throughout the world.

• The Philippine Peso has depreciated over 54% since June, 1996, while the consensus among most economists and bankers is that the "true value" of the peso is 14-30% higher than its present rate.
• The prices of these stocks have significantly dropped since their highs, as shown in the table, due to the economic turmoil in the Southeast Asian region.
• Gold prices are at five-year lows.
• The demand for oil should continue to increase, principally among the developing countries of Asia (notably China and India) and South America, as well as Russia.
• These oil and mining companies MIGHT just find something!

In other words, downside risks have been significantly reduced, while upside potential remains.

As a balance, I also present, in a second table, the performance of very good companies in telecommunications, banking, and electric distribution, PHILIPPINE BLUE CHIPS whose stock prices had been ravaged by the currency devaluation and by the general loss of confidence in the Southeast Asian region.

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Selected Mini-Pennies

Table goes here!!!

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Philippine Blue Chips

Table goes here!!!

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