| What is penny stock investing? | | | | Lets say you have $5000 dollars to invest. |
| Well it depends who you ask. Some will tell you that | | | | Well if a stock was selling at $50 dollars a share you |
| stocks trading under 5 dollars a share are penny | | | | could only buy 100 shares of that stock. |
| stocks, while others will say less than 1-2 dollars a | | | | However, if you purchased a penny stock that sells |
| share. | | | | for .50 cents a share you could buy 10,000 shares. |
| I agree with the 1-2 dollars a share because I have | | | | Why is that a huge temptation for some? |
| seen stocks priced between 2-5 dollars do just fine. | | | | Because money in the stock market is all about |
| However, anything less than 2 dollars a share and I | | | | shares. In the above example, for every .01 cent |
| think you are gambling. Also make sure any stock | | | | that the $50 dollar stock goes up in price you would |
| you invest in is listed in one of the major exchanges. | | | | make 1 dollar. So if the price goes up to $50.01 you |
| (NYSE/NASDAQ/AMEX) DO NOT get involved with | | | | just made 1 dollar in the stock market. However, if |
| OTC and Pink Sheet stocks. You are playing a | | | | the .50 cent stock goes up by .01 cent you just |
| dangerous game if you do because these stocks | | | | made $100 dollars. See the temptation? |
| have very little accountability compared to stocks | | | | However, the real truth is most penny stocks are |
| listed on the major exchanges. | | | | penny stocks for a reason because they are |
| Penny stock investing is a junior level course at least. | | | | worthless. Many simply do not go anywhere and |
| Trading penny stocks online is very difficult and can | | | | usually go down in price, or they disappear |
| be very risky. If you have never bought a stock in | | | | completely. Remember, stocks go down as well as |
| your life stay away from penny stocks. In the | | | | up. So for every penny that penny stock, in the |
| beginning, you may be tempted by the huge possible | | | | above example, goes down you would lose $100 |
| gains that one lucky penny stock that skyrockets | | | | dollars. |
| may bring you. | | | | Remember, to win in the stock market you have to |
| What one may see that tempts them into purchasing | | | | be a wise investor NOT a gambler. |
| a penny stock is as follows: | | | | |