Penny Stocks Defined.
In the US, a penny stock is a simple common stock that trades for less than five dollars a share and are traded OTC or 'over the counter' through quotation services like the OTC Bulletin Board or Pink Sheets.
A penny stock is said to be "thinly traded", although share volumes traded daily can actually be in the 100's of millions for a sub-penny stock. Legitimate info on penny stock companies can be difficult to locate online and a stock can actually be easily manipulated by unscrupulous brokers.
Buying Penny Stocks
If you are interested in buying cheap stocks to buy now why don't you give penny stocks a chance? I know penny stocks aren't held in the same regard as the more well known, high volume stocks that you see so much about. However, the truth is, there simply is much more growth and potential in trading penny stocks than there is in stocks that most brokers try to promote to their clients.
Penny stocks are also perfect for the beginning trader. A new trader most likely does not have $10,000 to open a full blown brokerage account, which is currently the minimum you will need to start a halfway decent portfolio, in my opinion. However, the great thing about trading cheap stocks like penny stocks, is that you can invest in a nice wide variety of companies that range from sector to sector without really having to have a huge bank account.
The tricky part is making the choice as to which penny stocks you want to initially invest in. Well, it doesn't really have to be that difficult. Trading penny stocks is very much like trading any stock on the market. You just have to look at the same fundamental and technical analysis prinicples as you would with any company that you are considering investing in.
All the information is there.
There are numerous ways to know when a penny stock is ready to boom. If there are enough liquid assets in the stock as well as enough price movement, you can see certain trend patterns that get repeated over and over again. The difficulty is being able to do a large and broad scan of the markets to know when opportunities like that arise.
I'm a successful day trader and I've found a system that allows me to quickly find profitable niche penny stocks in markets that are often overlooked. You can learn more by visiting
Thank you for reading.
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