| The world of penny stock trading has been touted | | | | a thousand or more. When you trade penny stocks |
| as the gateway to riches beyond your wildest | | | | in those amounts, the amount of money at stake is |
| dreams. Fortunes, it has been claimed, can be made | | | | not trivial. |
| in a single trading session. Those with a few hundred | | | | Another risk faced by those who trade penny stocks |
| or thousands of dollars can become millionaires almost | | | | is that the penny stock market is home to many a |
| overnight, and all of those who have do not hesitate | | | | bogus company established simply to print and hype |
| to tell the world about it. | | | | its own shares. There have been unscrupulous |
| But what those who have succeeded in the penny | | | | individuals who set up fake corporations simply to sell |
| stock market invariably fail to mention is that for | | | | the IPO shares and walk away. |
| everyone on the winning side of a trade there | | | | Many penny stocks have their price supported by |
| someone who is either risking or losing money on the | | | | nothing except fluff press releases and ads paid for |
| other side. Whoever decides to trade penny stocks | | | | by stock promoters. Often these efforts will lure |
| should realize that his or her chances of losing big are | | | | people into a stock, and when they come in, the |
| at least as great as the chances of winning big. What | | | | stock promoters get out and the stock promotion |
| are the precise risks to be faced by anyone wanting | | | | ends. Because the company itself has no substantial |
| to trade penny stocks? | | | | value, and there are no more new buyers being |
| The penny stock market is far and way the most | | | | enticed by hype, those in the stock will have a very |
| volatile of all the stock markets. Anyone wanting to | | | | time selling their shares, and the stock price will |
| trade penny stocks need to perform extreme due | | | | collapse. |
| diligence before investing in a company, because the | | | | Anyone who wants to trade penny stocks needs to |
| price penny stock can change direction in a minute, | | | | be able to tell the difference between a company |
| and for no discernible reason. If you aren't watching | | | | supported by hype and one which has real substance. |
| closely, you will not only miss your chance to lock in a | | | | The safest way to trade penny stocks is to have a |
| profit, you may be on your way to a serious loss. | | | | game plan and stick too it. Pill you capital out of a |
| While the phrase penny stocks may make you think | | | | stock as soon as you can, and either let your profits |
| you can trade penny stocks like you play penny ante | | | | ride, or used them to invest elsewhere. That way |
| poker, the phrase is misleading. Even if a single share | | | | you are always risking someone else's money, and |
| of a company's stock is less than a dollar, most of | | | | the stress that normally comes when people trade |
| those who trade penny stocks trade them in lots of | | | | penny stocks will pass you by. |