Day Trading Tips » Penny Stocks

Is there a difference between trading regular stocks and penny stocks?

admin — Fri, 27 Jan 2012 04:53:49 +0000

I currently own a few shares in the NYSE but have been looking at getting into penny stocks….Is there a difference in the buying and selling process?

My common order type is limit. Is that available?

Thanks in advance.

Yes, the difference is in the price they trade at. The official definition of a penny stock is a stock that trades for less than $5/share. However, people commonly believe it applies to stocks trading for less than $1.00. These true penny stocks (less then $1) are never of investment quality and the great majority of investors simply lose their hard earned money to unscrupulous promoters who make a mint on hyping them, because there is no underlying value in the company.

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Yes, even penny stocks can be and are usually bought on limit orders rather than market orders, due to their greater volatility. No difference in the buying and selling process, but some brokers (even online) charge a higher commission for those very low priced stocks.

Are Walmart bonds and penny stocks a good investment presently?

admin — Sat, 31 Dec 2011 05:28:56 +0000

Recently, I have been viewing different investment purchases that would be a good deal. If you think buying bonds with Walmart and/or buying penny stocks would be a good idea please let me know where and how I could buy these.

If you honestly cant see the difference between WallMart stocks and penny shares, my advice is to keep your money out of the stockmarket, and into low risk bonds or a crappy savings account.

Penny shares are not something you want to dabble with when you dont have a clue, you will be eaten alive

Not all penny shares are bad, but they take no prisoners and the chances of you finding a good one with your apparent knowledge is almost negligible

I want to buy some penny stocks. What website should I go to in order to do this?

admin — Thu, 29 Dec 2011 05:17:57 +0000

That’s it. I never bought stocks before, but I have some cash in the bank (yup, crazy place to leave your extra cash) so I thought it would be less crazy to put it in the stock market right now. I found a couple of penny stocks I’d like to buy and hold for awhile. I just need some advise on how to pick a seller or a broker.

You might want to read this article about penny stocks, they are highly speculative and risky.

http://en.wikipedia.org/wiki/Penny_stock

Penny stocks are horrible long term investments. Novice investors make the very critical mistake that a penny stock is a company that is just starting out or immature and just waiting to bust out. In fact, most penny stocks are priced so cheaply because the value and fundamentals of the underlying company is basically junk. The companies normally have very high debt, negative retained earnings, bad management, etc. Most penny stock companies will not be around for the long term as they are mostly smaller cap stocks, which have an extremely high long term failure rate. A penny stock is MUCH more likely to lose all of its value over the long term, than to make money. They can be fun to play with using small amounts of money, but NOT a very wise investment tool.

There are many comparison charts for online brokers

http://www.brokerage-review.com/

http://www.forbes.com/bow/b2c/category.jhtml?id=5

http://online-stock-trading-review.toptenreviews.com/

http://www.howthemarketworks.com./

http://stockmarket.makemoneyideas.in/

http://simulator.investopedia.com/#axzz1fc83KRM5 (simulator, and finance terms and definitions)

http://www.fool.com/how-to-invest/index.aspx?source=ifltnvpnv0000001

http://beginnersinvest.about.com/library…

http://www.mysharetrading.com

How can I get started in penny stocks?

admin — Tue, 13 Sep 2011 20:25:42 +0000

I realize that penny stocks usually aren’t the best route to take, but I’m not looking to become a millionaire, I’d just like to make a little bit of extra money. How do I put money toward penny stocks? How can I tell which are the most likely to succeed?

Use easy terms on me please, I’ve never done anything stock-related, but I’m curious, and it’s something I’d at least like to try – which is why I’m getting into penny stocks, to test the water a bit

Thanks!

With over 40 years of experience in the industry, I would not encourage you to do this, however to
answer your question, you buy penny stock like any other stock.

Here are some websites that will help you understand pennies, if there are any brokerage firms advertising on the site you can contact them
http://www.smallcapinvestor.com/
http://www.stockwire.com/
http://alphaking.com/
http://www.otcstockexchange.com/
http://www.mcapstocks.com/Default.asp
http://ragingbull.quote.com/cgi-bin/static.cgi/a=index.txt&d=mainpages
http://www.swingtrades.com/
http://www.pennystocks.com/

You can open an account on-line with the brokerage firm, send them your check (put your account number on the check – you’ll get an account when you establish an account). Once the money is in your account you can buy stock.

Be aware, the brokerage firms all have minimums that you must deposit to open an account, but the firm will make you aware of it.
If you have problems with either opening the account or entering an order you can always call the firm’s customer service department and they will help you

I want to start trading penny stocks, where do I start?

admin — Mon, 29 Aug 2011 08:36:47 +0000

So, I want to start messin with penny stocks, but I have no idea where to start. There are so many websites, stocks, and information out there, it is really overwhelming. Does anyone know of any good websites to get started trading through?

Most penny stocks are pump-and-dump scams, which means you’ll lose massive amounts of money.

The majority of institutions only invest in stocks $5.00/share or higher. Since the Smart Money doesn’t deal in penny stocks, why should you?

Why does everyone tell you not to invest in penny stocks?

admin — Wed, 03 Aug 2011 07:58:40 +0000

Everyone says they could be a pump and dump scam but I’m thinking you invest 100 into 2 cent stocks they go up a penny or two. Let’s say 2 so they r at 4 cents why not turn around and sell them for 200 dollars minus 5 dollars for the buy and 5 for the sell. You make 90 bucks?

You have a good theory. There are penny stocks that have sold for .0001 cent. and rose up to .50 cents – $1. If you had bought a million shares at .0001 cent, sold at .50 cents or $1 you would have a million dollars in theory.

But in real life that is never the case. Penny stocks fluctuate alot . Even one seller/buyer could drastically alter the price. In addition, penny stocks have low volume it would be a hard time finding a buyer for your investment and the actual companies don’t really make a profit. I did some research on a couple penny stock companies, the address they listed as their headquarters was a residential area on most of them, one of them was an apartment complex. Must be a very nice place to run a company right? Now you know why they sell for so cheap.

I would turn my attention to stocks on the nasdaq that are selling for $1 – $3. These are legit companies and you would have better luck investing in them rather then penny stocks.

What is the best website to look at for penny stocks?

admin — Thu, 07 Jul 2011 13:20:50 +0000

What is the best website to look at for penny stocks?
Maybe like penny stocks that just went public website? Or helpful guide for penny stocks. Or a list of penny stocks at their "lowest"

OK, penny stocks are really risky to invest in, because they usually very volatile (Increases or Decreases too much), so better to stay away from them. Also, one more thing, when a penny stock of some company is at its lowest level, it means that the company is near to file for bankruptcy, which means investors will lose all of their investments.
Plus, in general, when the stock share of specific company is too cheap (i.e. penny stock), it simply means the company is not performing well at all, and it is looking for investors to buy its share. Look at the big companies like APPLE, its share is above $300 (The company is doing very well)..
Only professional investors with high knowledge can trade penny stocks.

Better to stay away from them.
You can refer to Wall Street Journal Website to view the companies that are 52-weeks high and low.

How do you pick penny stocks to invest in when there are thousands to choose from?

admin — Tue, 24 May 2011 01:30:57 +0000

I mean, let’s say you’re really serious about investing and want to invest in a penny stock or two among other stocks. How would you choose them among the numerous options without reading every single prospectus or set of financial statements out there? Thanks

Penny Stock comes under Higher risk and Higher return category of Stocks. Penny stocks attracts a lot traders due to their ability for higher investment gains,but because of their highly volatile nature and most unpredictable form of investment in the stock market.

Still if you are sure to invest in them you must know:
1) There are various companies which usually have no track record of solid financial performance due to which penny stocks can get manipulated.So have a look on that.
2)You must know which Penny stocks you have to keep away
a)stay away from companies that reflect negative EPS or earnings per share.
b)stay away from penny stocks whose average daily volume of is very less.
c)Have a look on the stock technicals, it should be in an uptrend and above support levels.
d)In addition, always check and read news concerning stocks.

What are some penny stocks that fluctuate alot throughout the day?

admin — Tue, 17 May 2011 07:01:58 +0000

I’m looking at some penny stocks right now and I’m just wondering if anyone knows any penny stocks that fluctuate a lot during the day since I want to do some day trading.

Bid-ask spreads are wide in penny stocks, and they are thinly traded. The commissions are usually high for the amount bought. All these conditions make penny stocks hard to day trade for a profit.

What is penny stocks? How do i learn to use it? And how long does it take to get started?

admin — Tue, 10 May 2011 08:34:48 +0000

I’m looking for ways to make money when i came across penny stocks, can anyone explain how it works?

Penny stocks are just like any other stocks on the stock Market, however they are generally the stocks that are worth only a few pennies…

So whilst large companies may have stocks worth hundreds, smaller companies will have penny stocks.

This Market is the most risky, however as a result it has the most opportunity for return… For example a change of just 0.01 pennies to the value of the share in a day (a tiny amount) would be the equivalent of a 1% change I the share was worth 1p

Basically for penny stocks, a small change can have a massive impact on your investment (in either direction)…

I believe penny stocks/shares are traded just as any other stocks are, through a stock broker… Of course choosing your type of dealing and stock broker takes a lot of thought and planning also, just as picking your stocks/shares should.