Volume
traps
Sometimes
an apparent bargain can turn out to be quicksand because
of illiquidity. Before buying any stock, check to
see how many shares trade each month and work out
roughly the value of these shares.
You
may find that the volume is very small and that even
if you are showing a handsome paper profit, you cannot
sell the shares when you want to and are consequently
stuck in the stock. A stock with poor liquidity is
a nightmare in a falling market, as sometimes there
are no buyers at all, at any price!
You
cannot eat share scrip.
NEXT ... Manipulation
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