My primary reason for writing Making BIG Money in Small Stocks is to help you become the best investor you can be. Statistics indicate that 70 percent of all investors lose money in the stock market. Why? Most investors buy poor quality stocks at too high a price. They either get greedy and don’t take their profit or they ignore signals that indicate the price may go down. Then they end up selling their stocks for a loss. This book will give you a better understanding of the stock market and how to pick quality stocks, buy them at a good low price and sell for a tidy profit.

I’ve used what I call my CHEAP investing philosophy successfully for over 25 years. That philosophy has worked both in good markets and bad. Basically, I look for a company that’s fundamentally solid, with increasing sales and earnings that is selling near its 52-week low price. In its simplest form, it’s finding the bargain. 

Almost everyone has heard the old adage, "Buy low and sell high". Logically, that is the only way an investor will make money. The problem most investors have is they don’t think for themselves. Instead, they follow the herd. They get caught up in momentum buying, where they buy a stock that has hit new highs on the assumption that it will keep going higher. While momentum buying works well during bull markets, investors who followed that strategy after March 2000 through 2002, lost gigantic sums of money.

Investors now realize that investment strategies, like momentum investment, which worked in the bull market of the 90s, may not make the grade in today’s more uncertain market. Political upheaval, terrorism and accounting irregularities in the billions of dollars have caused an edgy market to become ever more volatile. Where should the investor turn? Back to the basics.

Looking back over 25 years of various investment strategies touted by different experts, the one strategy that I’ve seen work in both good markets and bad is buying low and selling high. J. Paul Getty stated it best in his well-known book, How to be Rich. He wrote that an investor should "Buy when everyone else is selling and sell when everyone is buying. This is more than a catchy slogan. It is the very essence of successful investing and accumulating wealth."

Quality, low priced stocks are very attractive to the small investor because they have the potential for huge profits. However, it is vital that you invest in a company that has solid fundamentals AND purchase the stock at the right price. Would you buy an automobile for $45,000 that was selling for $30,000 just last week? No, you wouldn’t because it’s too expensive! That's common sense but too many investors get caught up in the excitement of investing and jump on the bandwagon to purchase a great little stock, which just doubled in price. Sound familiar? We hear it all the time. Doesn’t it make more sense to get into that stock before it skyrockets? That’s what you’ll learn to do if you follow the techniques in the book.

Recently I watched some experts on CNBC issue buy recommendations on stocks they believed were good investments. One expert liked CarMax at $39. CarMax (KMX) is a great stock, but I liked it a lot better when I recommended it in my CHEAP Investor newsletter at $1.56. As usual, Wall Street finally discovered the stock after my subscribers had already made a 2,400 percent profit! Another expert liked Bradley Pharmaceuticals (BDY) at $31.50. I recommended that one at $1.03. My subscribers had almost a 3,000 percent profit by the time Wall Street liked the stock. Not only buying a quality stock, but also waiting for that stock price to drop to an attractive level is what makes my investment strategy so successful. You have to be in the right stock AT THE RIGHT PRICE to routinely make good profits on your investments.

Of course, it’s important to analyze the company before buying its stock. It used to be a time-consuming, tedious job to write or call a company for information to help you determine if the stock had investment potential. That changed with the advent of the Internet. With the click of a button, the Internet allows investors access to the current price and background information on almost any company. Where previously, analysts were the only ones who had such data at their fingertips, the Internet has become the great equalizer. The sudden availability of huge amounts of information has given everyone the chance to be a stock guru.

However, the Internet is a two-edged sword. While it is easier than ever before to learn about a potential investment, it has also caused information overload. Add chat lines, 24-hour financial networks, financial magazines and newspapers to the mix, and it’s no wonder that investors are feeling overloaded and confused. We’ve gone from a dearth of information to the extreme of too much information to decipher. Our task has become one of picking through a haystack of data to find (and recognize) the important needles of information. In many cases, we just get overwhelmed and end up doing nothing, because we don’t know how to proceed.

If you have this problem, this book is for you! It will detail how to research, sort through the data and analyze it, to find those investment candidates with good profit potential. Over the years, I’ve learned that I can’t know everything. If I try to analyze every stock, I’ll just end up frustrated, knowing a little about a lot. Instead, I specialize in one area, stocks under $5. Doing so eliminates the vast majority of information clutter. That frees me to concentrate on one important goal - finding a bargain.

I believe that knowledge is power. This book will give you the tools to make your own educated decision on whether or not to purchase a stock. You won’t have to rely on someone else, who may be more interested in a commission than in the quality of the investment. Making BIG Money in Small Stocks will teach you how to analyze a stock on your own and determine a good purchase price. It will also give you tips on how to protect your profit.

By purchasing this book you’ve taken the first step. Now make sure that you invest the time and effort to accomplish your goals. After reading this book, you will have a better understanding of the stock market, the economy and the investment process. You’ll have the knowledge to buy quality, low-priced stocks. This is the best investment strategy to fulfill your financial dreams!

I welcome your comments on the book and hope you find Making BIG Money in Small Stocks interesting, educational and profitable!