If you love penny stocks (and judging by the number of heavy hitting stocks that have slipped into the penny stock range over the last 18 months…there are a lot of you out there) then the last month has been one of either great optimism, or great pessimism.From March 9 to April 9, the Dow Jones industrial average gained 23%, the S&P 500 was up 26% and the Nasdaq Composite was up 30%. Small-cap stocks significantly outpaced large-caps, with the Russell 2000 Index up 36% in the same period. According to S&P’s Howard Silverblatt, this has been the steepest 23-day advance since 1933.The recent price appreciation in U.S. equities led one investment officer to say the rally is “too explosive to be sustainable.” According to Birinyi Associates, when small-cap stocks outperform large-cap stocks to this degree after bear markets, rallies fizzle.Will history repeat itself? Or will small-cap and penny stocks continue to trend higher?According to one article I was reading (and no doubt there are ten times as many that point to the contrary) the pessimistic viewpoints seem to rest on one major assumption–that history is a good guide for the future.And often times it is. Except in those cases… Read full this story
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Is the Penny Stock Rebound Too Good to Be True? have 263 words, post on ezinearticles.com at April 20, 2009. This is cached page on Europe Breaking News. If you want remove this page, please contact us.