| There are thousands of stocks that are traded are | | | | new investors to help keep their company in |
| the major indices and a good portion of them are | | | | business, so unless they are fundamentally sound or |
| penny stocks. They're the same as any other stock | | | | that the technical charts show you signs of a near |
| in regards to being a percentage of the the total | | | | future pop, it's not an easy thing to do. If the |
| value of the company. The reason they're called | | | | company doesn't have the right product or the right |
| penny stocks is because the value of each share is | | | | leadership, they will most likely stay where they're at. |
| worth less than one dollar. Some investors feel they | | | | Instead you might want to invest in small cap |
| are any stock valued at less than five dollars. | | | | companies that have a more of a proven record and |
| To new or average investors they think along the | | | | still leaves a lot of room for some great gains. I look |
| line as to that they can buy more shares of a penny | | | | for stocks that are valued between $6-$20 per |
| stock than they could with a blue chip stock. If you | | | | share. In doing so I've been able to weed out many |
| have Thousand dollars to invest in one company, you | | | | of the weaker companies to help minimize the risk |
| could buy twenty shares of a company whose share | | | | involved, while still having some good opportunities to |
| price is $50, but you could also buy 2500 shares that | | | | make large profits. |
| are valued at $0.40. Most large cap companies have | | | | Before you buy any shares of a company you must |
| already grown so much that it's highly unlikely that | | | | do your research to see if the company is doing the |
| the stock price will double, but as for a penny stock, | | | | right thing to help the company grow. Read their |
| it could increase in value by more than 1000%. Take | | | | financial reports, quarterly earnings report as well as |
| into consideration that most penny stocks won't | | | | their balance sheets. Learn to read chart to help you |
| grow by that much. | | | | see when a company may stand a chance of a large |
| Typically most penny stocks never grow large | | | | volume day that will increase the value of their |
| enough to not be considered one, but how do you | | | | shares. |
| know which one to buy to assure that your portfolio | | | | These are the things to take into consideration if |
| will increase. There is no clear cut system to pick the | | | | you're looking to trade penny stocks. |
| sure winner. Companies struggle constantly to find | | | | |