-
Penny stock investments are very attractive and the potential investors make efforts in gaining higher ROI with their stock investment interests. There is minimum capital required to get a number of shares in penny stocks and these are traded over the larger markets to get more money. The number of shares attained in penny stocks is more and this is the major reason for people to purchase them. Penny stock investments should be understood well before making the right purchase.
The concept of nano stocks is quite appealing to the new investors. They feel like purchasing hundreds of shares by spending only a few hundreds of dollars. However, the market investments might ruin all your money, if you are not making full research before purchasing the micro cap stocks. There are many large companies trading stocks on major stock exchanges and they are relatively secured. Out of thousands of penny stocks, only 1-2% stocks are actually worthy and this is the major reason for making the research before purchasing these stocks.
The major goal of an investor is to check out the profits attained at the end of the day. More shares in your pocket don’t mean that you will get profits from your venture. There are penny stock acquisitions and establishment of right actions to get the required returns from your investment. Penny stocks require a good deal of research and avoidance of hurries to get profitable responses. These stocks are located in OTCBB or pink sheets, which are less reliable and contain a variety of tactics.
You need to discover your own trends to find out the most promising stocks and at the same time, it is essential to cut down the list of the stocks having higher too many fluctuations in the least time. The logical side is to trade the stocks having good reputation in the market.
Comments Off on Penny Stock Trends -
-
Penny stocks are the micro cap stocks having per share value ranging from a few cents to maximum 5 dollars. These stocks are not dealt on major stock exchange listings and hence, these are not preferred by many people. Penny stocks are also called nano stocks or micro stocks and the price of these stocks is determined by per share value and the total market capital of the company.
The companies included in penny status have the market cap lower than $500 million. The stocks are highly speculative and traded over the counter. Penny stocks are difficult to sell due to high volatility and low liquidity levels. However, the investors need to know about them in detail before making any move in penny stocks as the risk involved in these stocks is too high in comparison to the major stocks. Despite of the risks, these investments appeal people due to the low initial pricing and the possibility of earning high profits. Potential risks come along with the substantial losses in these stocks.
Penny stocks are quite risky and the investors should be aware of this fact. The liquidity levels are low, which add to their fraudulent chances. Penny stocks have less number of shareholders and it makes them less reliable. These stocks are very unpredictable and the prices either grow abruptly or fall off within no time. The lack of liquidity makes these stocks less likeable by people.
Pink sheets or OTCBB includes penny stocks and these contain low regulatory requirements than the listed stocks. The notification of penny stocks is less and this makes them a tool for fraud. It doesn’t mean that all penny stocks are not worthy, but most of them are highly unpredictable, which make them prone to doubt. The risks involved in penny stocks are more and they should be purchased carefully to avoid losses.
Comments Off on Penny Stock Risks -
