Buying Penny Stocks:
Buying Penny Stocks has been quoted in multiple sources as “The Next Gold Rush” and “The Next Bull Market.”
For a variety of reasons, an opportunity in penny stocks is just beginning. In the coming years, you should see unprecedented gains in the prices of penny stocks as entrepreneurs seek out new opportunities in growth sectors such as alternative energy, mining, biotech, technology, and dozens of other industries.
By almost any benchmark, small cap penny stocks are the next bull market, whether on Wall Street, or Canada’s Bay Street. Given the current investment climate, as the economy improves, and it will, these penny stocks will explode higher. But why wait until then and miss the opportunity to buy low, and to buy now? The conditions exist for astute investors to get in on the ground floor on dozens of potential penny stocks. They are the next big thing.
Penny Stock Investor:
Being a penny stock investor is like being a venture capitalist. You often have the opportunity to get in on the ground floor of developing companies that have plenty of promise ahead of them.
But with this also comes the risks, the risks that come with any investing, as well as the risks associated with owning shares of small companies that have not yet proven themselves. But that’s where our research and due diligence will come in.
Ironically, most people are so risk-averse when it comes to investing that it almost guarantees a negative outcome for them. They follow the bad stock advice given to the unsophisticated masses to buy mediocre prepackaged investments that really don’t keep up with inflation. It’s like staying in the shallow end of the pool.
So given a ground-floor opportunity of a small company, most people would rather wait until a small profit is a certainty. But instead, most end up with either a trading loss or a dismal to mediocre gain as everyone else has already piled into the same stock which is now either overvalued or poised for a decline, if not already declining.
Economic historians will tell us that through bear and bull markets the stock market will average out at 8% to 10%. But for investors that know where to look, the highest profits come from small companies with big prospects. Finding the right company at the right time and taking a position in that company before its shares hit penthouse prices.
Small cap penny stocks have traditionally enjoyed spectacular gains compared to higher priced stocks. Over a recent 10-year period, small cap penny stocks outperformed larger cap stocks by a ten-to-one margin. As for recent gains, the top ten penny stocks increased in value 261% in one year, where in the same period the top ten S&P stocks gained 15.5%.
Beyond just the price, look at it this way… smaller companies are more likely to be start-ups in the early stages of development. This allows greater upside potential. Larger more established companies have far greater difficulty achieving the same level of growth as smaller companies. Small company earnings and stock growth can double, triple (300%), and quadruple (400%), while larger companies struggle to achieve even a double-digit gain.
It is not uncommon to see the stocks of smaller companies increase in value by many hundreds of a percent. But many small companies can also fail or languish without bringing profits.
So to mitigate our risks we will learn to analyze and select the right companies in which we’ll invest.
Penny Stocks List:
Knowing the basics of performing a fundamental and technical analysis, or having access to that same information from someone else’s credible analysis, will be vital to becoming a winning penny stock investor.
You only need a few good stocks to make a significant amount of money. Doing the work or having access to the right information and analysis can pay-off.
In the past, penny stocks had a bad name because of risk and lack of information about the companies. Nowadays that has changed, and investors are quickly learning that penny stocks represent small companies across America and Canada that are great and have yet to grow or be discovered.
Penny stocks can be a little more complex than buying other stocks or mutual funds. It’s important to do your research. However, if performed properly buying penny stocks has the possibility to change small investments into huge gains. As with any investing, it’s ideal to seek advice from a qualified broker.
Not only must you understand “what” stock to buy, but “how” to buy as well. “Timing” is everything in the market, and it pays off. There is nothing quite as exciting or rewarding up-and-coming small cap stocks, those on the path to growth, profits, and big returns for their shareholders.
Penny Stock Trading Secrets:
Wading through all the investment sites, blogs, news channels and magazines to find reliable and practical advice can leave your head spinning.
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