Stocks Penny stocks can make you a ton of money. But they can also lose you a fortune. Have you got the belly to take a position in these small priced stocks? Consider these elements.
First off, what's a penny stock? The most generally accepted definition of a penny stock is a stock that regularly trades for less than $5 a share. While most penny stocks are connected with the over-the-counter traded "Pink Sheet" stocks, penny stocks can be discovered on the NYSE and the NDX .
1. How far are you from retirement?
If you are less than ten years from retirement, then you shouldn't be making an investment in penny stocks. Penny stocks are rather more like a bet than an investment. And if you do make a decision to invest in a penny stock, it should be with cash that you don't need for retirement. Consider it your "Vegas money."
2. Do you not like volatility?
If you detest to look at the highs and lows of the market, then a penny stock isn't suitable for you. Some penny stocks can double and lose 80% of their worth in the same week. That's because penny stocks are the most hyped of all stocks on the market. A mention in a stock newsletter alone can make a penny stock double. That suggests that these stocks are moving without any real elemental concept.
3. Do you under stock financials?
If you don't understand p / e proportions or net profit vs gross profit, then you shouldn't be making an investment in penny stocks. That's because there are lots of penny stocks have extraordinarily infirm balance sheets. Unlike stocks in the DJX thirty or the SP five hundred, penny stocks are sometimes made of little corporations with extremely murky finance statements. If you are unable to know how a penny stock company earns cash, then you'll have much difficulty earning a profit.
First off, what's a penny stock? The most generally accepted definition of a penny stock is a stock that regularly trades for less than $5 a share. While most penny stocks are connected with the over-the-counter traded "Pink Sheet" stocks, penny stocks can be discovered on the NYSE and the NDX .
1. How far are you from retirement?
If you are less than ten years from retirement, then you shouldn't be making an investment in penny stocks. Penny stocks are rather more like a bet than an investment. And if you do make a decision to invest in a penny stock, it should be with cash that you don't need for retirement. Consider it your "Vegas money."
2. Do you not like volatility?
If you detest to look at the highs and lows of the market, then a penny stock isn't suitable for you. Some penny stocks can double and lose 80% of their worth in the same week. That's because penny stocks are the most hyped of all stocks on the market. A mention in a stock newsletter alone can make a penny stock double. That suggests that these stocks are moving without any real elemental concept.
3. Do you under stock financials?
If you don't understand p / e proportions or net profit vs gross profit, then you shouldn't be making an investment in penny stocks. That's because there are lots of penny stocks have extraordinarily infirm balance sheets. Unlike stocks in the DJX thirty or the SP five hundred, penny stocks are sometimes made of little corporations with extremely murky finance statements. If you are unable to know how a penny stock company earns cash, then you'll have much difficulty earning a profit.
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