Skip to main content

Penny stocks getting started

Penny stocks getting started

Introduction to Penny stocks: Penny stocks are low priced speculative stocks and these stocks are traded in over the counter (OTC) market. As per SEC (The Securities and Exchange Commission of United States) the maximum price of the penny stocks is fixed at $5.0 per share and in actual the price of these stocks are well below and sometimes a mare one cent. Although the penny stocks are commonly traded in the over the counter market, however these can also be traded at NYSE or NASDAQ.


How to start trading penny stocks: Although it is a common belief that the penny stocks are risky but at the same time as the share prices are generally low, the risk associated with penny stocks is also minimum. Many people see investing in penny stocks as an opportunity to learn share-trading techniques and at the same time not all penny stocks are risky. Although the investment in penny stocks may not substantially improve your financial condition, but the selected penny stocks may give you some profit. 

If you have made your mind to invest a small amount of money in penny stocks, you will have to approach a trader or dealer for getting started. As per SEC (Securities and Exchange Commission of United States) guidelines you have to give a written request to the broker and after approval you may buy the stock from the broker. You should consult the trader and should invest carefully. Your broker will tell you the rate of the stock and brokerage.

Before investing in penny stocks contact to the Securities division of your state and get information about the broker. The history of broker provides important information about the license and disciplinary actions taken against the broker. 

Once you have decided to deal with a broker, get all the information regarding the penny stocks, brokerage and other terms and conditions in writing from the broker. You should also keep the records of all the written documents provided to you by your broker. You should ask your broker to provide you the written documents mentioning the recommendation for buying or selling of any penny stocks. You should also take an independent opinion about the penny stocks from another broker and decide judiciously before making any investment. Your broker should also provide you a monthly statement mentioning the penny stocks held by you in your account and the rates of the penny stocks.

SIPC Coverage: Brokerage firms dealing in penny stocks will generally have SIPC (Securities Investor Protection Corporation) coverage. If the brokerage firm is unable to pay you your dues due to bankruptcy, the SIPC ensures that the customer owned penny stocks held by the brokerage firms are paid. SIPC insures the entire customer owned securities held by the brokerage firm, however in case of fraud, the insurer is not liable to pay the amount.



Summary:  Although investment in penny stocks is not quick rich type of schemes but the investment in penny stocks may provide an opportunity to learn trading. You should take at least a second opinion about the specific company before investing in a penny stock.



Comments

  1. Thanks for sharing such great post, it will surely help many people to get such detailed info.

    ReplyDelete
  2. Now this is very interesting, impressive and never thought of. In simple words well done for providing creative information.

    ReplyDelete

Post a Comment

Popular posts from this blog

5 Medicinal benefits of Sugarcane

Sugarcane is a tropical, perennial grass that forms lateral shoots at the base to produce multiple stems, typically three to four meters high and about five centimeters in diameter. The stems grow into cane stalk, which when mature constitutes approximately 75% of the entire plant. A mature stalk is typically composed of 11–16% fiber, 12–16% soluble sugars, 2–3% non-sugars, and 63–73% water. A sugarcane crop is sensitive to the climate, soil type, irrigation, fertilizers, insects, disease control, varieties, and the harvest period. The average yield of cane stalk is 60-70 tonnes per hectare per year, however this figure can vary between 30 and 180 tonnes per hectare depending on knowledge and  crop management approach used in sugarcane cultivation. Sugarcane is a cash crop , but it is also used as livestock fodder. [ 6] 1. Sugarcane juice increases vigour and sexual ability. 2. improvement takes place in burning in urine, thirst, cough, fever, indigestion, joint pain et

Investing in penny stocks

Investing in penny stocks The first question is 'To invest or not invest' in penny stocks. This is largely a personal decision that reflects your risk profile. If have the capacity as well as the nature to take greater risks, you could be looking at penny stocks. If your financial position is not very strong, and you have little spare money to invest, it is better that you keep off penny stocks altogether and look at established stocks only. Similarly, even if you have a lot of money to spare but are generally averse to taking risks, it is better that you don’t invest in penny stocks. If you are the kind of person, who likes to take risks in order to increase your returns, and can afford to lose some money if it comes to that, then you could look at penny stocks. 

Shocking and Interesting Facts about Stuttering

Shocking and Interesting Facts about Stuttering How do people usually react when they hear someone stutter? They most likely make fun of the stuttering person. And how do people usually perceive someone who stutters? Stupid, dumb, or even good for nothing. A person’s competence or personality is always judged based on how good a speaker he is. That is a sad reality for many people who tend to stutter. Whether you are among the 1 percent of the world’s population that stutters or not, it helps to know and understand the basic facts about this speech condition to put things in a better perspective. This is especially helpful for parents with children who stutter.