Stanley Barsch aka Stan The Trading Man is a penny stock investor with a cult-like following on Twitter. Stan’s profile has really taken off since the start of the pandemic. Thousands of bored and jobless Americans now chase stock market riches by gambling on penny stocks. Stan has benefitted from the rise of investing mania, some of them discovering his “high quality” DD.
Stan has been referred to as a “pumper” on Reddit – someone who accumulates a position in a company and heavily promotes that stock to others. Typically the companies promoted are more hype than substance but are tied to a catalyst.
Genius Brands (GNUS) is a prime example. They are a children’s media company that creates and licenses entertainment content. Despite the catalyst for short-term growth, management has consistently failed to turn hype into tangible value for shareholders. Genius Brands are facing declining revenues, spiralling expenses and will do well to avoid bankruptcy in the future.
The Washington based trader gained a reputation for finding big movers early – examples include GNUS, IDEX & XSPA. The whole thing has become a self-fulfilling prophecy. Traders buying alerts because the previous picks were big runners. Those who took the risk and invested early most likely made lucrative profits. The poor souls who bought late or held shares for the long-term ended up as bag holders.
Stanley’s fame on Twitter hasn’t gone unnoticed by financial media outlets, appearing in various news articles and on Fox Business alongside Sharmila Viswasam. The pair were interviewed by Charles Payne on their journeys to become successful day traders. Funnily enough, Charles Payne has history touting penny stocks on Fox, somehow he didn’t get fired.
Poor Stan got himself into trouble in August 2020 due to inappropriate messages with a few female traders. The tweets were leaked across social media and instantly went viral. The whole penny stock community came after him, labelling him a “creep” for his actions. Ms Viswasam seemed to be one of the few people sticking up for him during the tough times.
Stan later apologized, deleted his Twitter account and took a break from trading. Loyal followers were left in the lurch, who would they now follow for new penny stock picks? Luckily, the likes of Stock Lizard King, Buy Sell Short, Yates Investing and Huge Henne filled the gap left while he was away.
Return from Hiatus
In November 2020 Stan returned to Twitter and is now back in full flow, sending out 10+ tweets per day. Now it appears Stanley is focusing more attention on lower priced stocks, under 10 cents in some cases.
HQ Global Education Inc (OTCMKTS: HQGE), a recent alert was trading for less than a cent at the beginning of February 2021 and is currently at 3 cents per share on strong volume. These triple zero penny stocks are insanely risky, they are not long-term investments. I wouldn’t hold any shares overnight. Only trade them if you can afford to lose all the money invested.
If I was Stanley I’d be more careful around how he promotes companies. I believe it’s a matter of time before the SEC gets involved and starts prosecuting traders for pumping OTCs. The Financial Times is taking notice of the OTC market, picking out two traders – Alexander Delarge & Canadian Jennifer for their role in pumping SpectraScience, a company that hasn’t filed financial results since 2017!
Although Stan does have a lot of haters (among them Tim Sykes) I don’t have anything against the guy. He’s attracted a lot of new attention to the OTC markets, most of which shouldn’t be anywhere near the financial markets. While it’s possible to make money with Stan’s plays, I advise you to thread carefully. Don’t get caught holding the bag.