Glossary Term

Boiler Room

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Boiler rooms are disreputable brokerage businesses that use cold-calling and high-pressure sales tactics to try and get potential investors to buy penny stocks or other securities. Usually these investments are useless and have no prospects, but they can even be complete scams to begin with. These businesses prey on economically vulnerable and ill-informed people, tempting them with the prospect of massive gains and future profits but ultimately never delivering anything of value. Boiler rooms are illegal and cost naive investors in excess of $10billion per year.

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