Net Net Hunter Penny Stocks, International Stocks. Internet

In reading this report, I can't help but feel frustrated.

First of all, I don't tout "penny stocks". I advocate small investors with strong emotional intelligence buy Ben Graham deep value stocks, the same net net stocks he recommended to small investors in "The Intelligent Investor".

I've also made it very clear, repeatedly, that investors should not buy just any net net stock. Investors should be very selective when purchasing net nets. That's why I always talk about "High Quality International Net Net Stocks" on my website -- you shouldn't be buying just any net net!

His description here, 

""Net net" stocks are inherently risky.  A lot of net net's are frauds and are therefore selling at depressed prices.  Upon first impression, these companies seem like a bargain, however after a bit of analysis a lot of these companies are found to have serious problems. "

...is half true. In the US, UK, Australia, Hong Kong, and Canada there are a lot of net nets that are based in mainland China (ie. Chinese reverse merger scams) which I consider very risky. The same goes for resource exploration companies, financial companies, and pharma firms. While all net nets have problems, which accounts for why they're bargain stocks in the first place, some firms should definitely be avoided. That's why I purposefully screen these stocks out.

Diversification can also neutralize the risk that any individual stock poses. Don't buy net nets unless you buy high quality opportunities and diversify. When Ben Graham talked about net net stocks on the bottom of page 466 in the Intelligent Investor, he wrote, "If an investor could now find 10 such issues, for diversification, he could be confident of satisfactory results."

I have written and shared many articles that advise against buying poor quality opportunities. To defend myself, I will include the links here:

Here is an article I wrote telling people how to keep from getting sucked into penny stock scams:

http://www.gurufocus.com/news/255448/how-the-penny-stock-prince-could-butcher-your-portfolio

Here is an article telling people to avoid Chinese reverse merger scams:

http://www.netnethunter.com/ncav-stocks-from-china-nothing-but-water/

Here is an article telling people to avoid companies that have NCAV shrinking at a fast rate:

http://www.netnethunter.com/net-net-stock-value-traps/

And here is the article which explains how to dig out the good investment opportunities from the bad:

http://www.netnethunter.com/my-ncav-investment-scorecard/

As far as the profit potential of these stocks go, a quick google search will turn up a number of academic studies or corporate white papers that include the results of the study over 50 years. One such would be "What Has Worked on Wall Street" by legondary value investing firm Tweedy Browne.

If anybody wants clarrification, feel free to contact me through my website and I'd be happy to discuss the matter with you.

Sincerely,

Evan

Net Net Hunter