Your Questions About How To Invest In Penny Stocks

Maria asks…

What are penny stocks/ Are they something good to invest in?

I have been thinking about investing in Penny stocks, but, I don’t know if they’re safe. Anybody have any experience?

John answers:

By industry definitions, penny stocks are any equity security that trades for less than $5.00 a share.

When you invest/trade in penny stock you should never put up more than you can afford to loose and you should assume you will loose it all. Unlike regular securities, penny stocks usually do not let you use risk cutting procedures (options and/or stop orders) since most are not traded in a regulated market place. Since there no requirement on market makers in the OTC Market it may be difficult to find a buyer when selling is required.

They say when you buy securities you have a 50%-50% chance of making money, when you buy penny stocks you have a 50-50-90% chance, 50-50 chance of making money and a 90% chance of loosing money. Since there are no meaningful regulations for trading only those with trading experience stand a chance of being successful trading in penny stocks. Penny stocks are not for newbies.

When buying penny stocks, like any other security investment, you never invest 100% of you investing capital. Penny stocks are fun to trade, but you should never count on them to be considered part of your primary investment objectives. One should not trade penny stock unless they have several years experience trading regular securities.

And before you enter an order for penny stock, read what the SEC has published regarding penny stocks http://www.sec.gov/investor/pubs/microca…
Penny stocks are not recommended by any professional in the industry, the regulatory agencies do not want their members to trade in them, and no reputable person would every recommend them, so why would you want to buy them.

Susan asks…

What do you advice me if i want to invest in penny stock?

What do you advice me if i want to invest in penny stock? Is it a good for long term?

John answers:

Ohh yeah 1cent can turn into 5cents
but at that low its just gambling

Betty asks…

What are good penny stocks to invest in?

I’m looking to make good gains through investing in penny stocks.

Anyone?

John answers:

There is no such thing as a good penny stock to invest in.

When you invest/trade in penny stock you should never put up more than you can afford to loose and you should assume you will loose it all. Unlike regular securities, penny stocks usually do not let you use risk cutting procedures (options and/or stop orders) since most are not traded in a regulated market place. Since there no requirement on market makers in the OTC Market it may be difficult to find a buyer when selling is required.

They say when you buy securities you have a 50%-50% chance of making money, when you buy penny stocks you have a 50-50-90% chance, 50-50 chance of making money and a 90% chance of loosing money. Since there are no meaningful regulations for trading only those with trading experience stand a chance of being successful trading in penny stocks. Penny stocks are not for newbies. “Investing” in penny stocks supports the proverb “A fool and their money are soon parted”.

When buying penny stocks, like any other security investment, you never invest 100% of you investing capital. Penny stocks are fun to trade, but you should never count on them to be considered part of your primary investment objectives. One should not trade penny stock unless they have several years experience trading regular securities.

All that said, here are some websites that you will find helpful
http://www.smallcapinvestor.com/
http://www.stockwire.com/
http://www.otcstockexchange.com/
http://www.pinksheets.com/pink/quote/index.jsp
http://ragingbull.quote.com/cgi-bin/static.cgi/a=index.txt&d=mainpages
http://www.pennystocks.com/
http://www.penny-stock-brokers.org/
http://www.pennystockalley.com/
http://www.superstockhunter.com/
http://thestockmarketwatch.com/markets/pennystocks/today.aspx

Lisa asks…

I want to start buying penny stocks where and how do i start?

I’m interested in investing in penny stocks but have no clue where to begin any advice?

John answers:

Advice: Avoid penny stocks.

Penny stocks are far riskier than other stocks. They are completely inappropriate for the novice investor.

Read the SEC (Securities and Exchange Commission) link below. If you do not fully understand all of these risks, avoid penny stocks.

Consider mutual funds until you gain some investing knowledge.

Great fund companies include Vanguard and Fidelity. Both offer discount brokerage services. Both have good sites and excellent customer service.

Good investment reading that should be in any decent library:

One Up On Wall Street – Peter Lynch
A Random Walk Down Wall Street – Burton Malkiel
The Intelligent Investor – Benjamin Graham

Laura asks…

What is the best online trading stock site to buy penny stocks?

I want to invest in penny stocks and mainstream stocks but some major online brokers dont offer penny stock trading. What do you use / think is the best?

John answers:

Scottrade.com is best for both beginners and professionals.

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