If you have always wanted to get into the stock market but did not know where to begin, penny stocks are worth investigating. While today they do not necessarily cost pennies, they are under five dollars per share and often overlooked.
The term penny stock once meant exactly that; stocks that sold for pennies. Today, the SEC and the brokers include those less than five dollars though the term is still used. With some due diligence, you can find those to invest in that, while inexpensive, will make money for you. Many new companies begin with modest price points and as they grow, so does their stock. Well-known companies can fall for any number of reasons, but will have a stunning comeback with restructuring or new management. Auto companies are a case in point.
To begin buying and selling, you need a brokerage account. Ask someone to recommend one or do some online research. If you have no idea how to begin, the staff will walk you through the basics although they will not do your picking for you. That will be your job.
If you want to practice before you invest, sign up on an online virtual stock market site. Here you work with play money, in the real market. This will allow you to see how good you are at picking before you risk your money. Study a few companies selling for a pittance and follow them for a month. Get a feel for what grows, what falters and why.
The number one risk with penny stocks is the obscure bottom line of a company. Small companies are not as likely to have their spread sheets out there. If a company is too secretive, move on. You have to wonder what they are hiding and as a beginner, question everything.
Call the company to get information on their stock. Check out their products. Study the competition and their marketing programs. This method is effortless if you buy a company selling a product or service that you use. Investing in companies offering something you are familiar is a leg up.
Do not go in completely alone. There are many penny stock newsletters that will keep you up to speed on where things stand. Subscribe to one or more of them. Online, you will find links to numerous research sites. Stay alert to the business news and any tips concerning your area of investment. Information, heard just about anywhere, can be of importance. Train your mind to look at the big picture and current trends.
There are some things to avoid, as a rule. Try to stay with the big stock exchanges. Learn to read their listings. Certain letters can mean bankruptcy or lack of transparency. Read those financial journals religiously.
There are stocks trading on what is referred to as a Pink Sheet. Tread lightly. It usually means stocks trading for pennies or fractions of pennies. Do your research if this is where you want to go. Some companies are small or very new. That does not mean they will not grow. Do your analysis and be confident in your judgment. Learn all you can about penny stocks before you invest. Then go for it. In time, if you are a savvy, and determined investor, you will be playing in the bigger field.
The term penny stock once meant exactly that; stocks that sold for pennies. Today, the SEC and the brokers include those less than five dollars though the term is still used. With some due diligence, you can find those to invest in that, while inexpensive, will make money for you. Many new companies begin with modest price points and as they grow, so does their stock. Well-known companies can fall for any number of reasons, but will have a stunning comeback with restructuring or new management. Auto companies are a case in point.
To begin buying and selling, you need a brokerage account. Ask someone to recommend one or do some online research. If you have no idea how to begin, the staff will walk you through the basics although they will not do your picking for you. That will be your job.
If you want to practice before you invest, sign up on an online virtual stock market site. Here you work with play money, in the real market. This will allow you to see how good you are at picking before you risk your money. Study a few companies selling for a pittance and follow them for a month. Get a feel for what grows, what falters and why.
The number one risk with penny stocks is the obscure bottom line of a company. Small companies are not as likely to have their spread sheets out there. If a company is too secretive, move on. You have to wonder what they are hiding and as a beginner, question everything.
Call the company to get information on their stock. Check out their products. Study the competition and their marketing programs. This method is effortless if you buy a company selling a product or service that you use. Investing in companies offering something you are familiar is a leg up.
Do not go in completely alone. There are many penny stock newsletters that will keep you up to speed on where things stand. Subscribe to one or more of them. Online, you will find links to numerous research sites. Stay alert to the business news and any tips concerning your area of investment. Information, heard just about anywhere, can be of importance. Train your mind to look at the big picture and current trends.
There are some things to avoid, as a rule. Try to stay with the big stock exchanges. Learn to read their listings. Certain letters can mean bankruptcy or lack of transparency. Read those financial journals religiously.
There are stocks trading on what is referred to as a Pink Sheet. Tread lightly. It usually means stocks trading for pennies or fractions of pennies. Do your research if this is where you want to go. Some companies are small or very new. That does not mean they will not grow. Do your analysis and be confident in your judgment. Learn all you can about penny stocks before you invest. Then go for it. In time, if you are a savvy, and determined investor, you will be playing in the bigger field.
About the Author:
Aspiring investors, you can find complete details about benefits of investing in penny stocks and more information about the reasons why you should read Penny Stocks For Dummies on our site, today.
No comments:
Post a Comment