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Penny Stocks are stocks that usually trade below $5 per share. Penny Stocks are a very risky investment but if you are diligent, you may become one of a small group of investors who have experienced a tremendous profit. Although penny stocks are said to be "thinly traded," share volumes traded daily can be in the hundreds of millions for sub-penny stocks. According to the SEC Penny stocks are conventionally referred to as stocks that are priced at $5 or less, are not listed and do not trade on NASDAQ,.

Investing

Investing in Penny Stocks is both Risky and Profitable, the easiest money made is in finding tightly held small float stocks, ie: low public floats. Investing can be confusing, but we can help with more information on our free list of penny stocks, best free penny stocks and learn to pick penny stocks. You must carefullymanage the high risk by doing careful analysis before investing to try to findthe best candidates to consider. always do your research (due diligence) before investing or trading in any stock 24.

Trade

Traders of penny stocks are losing an estimated $2 billion a year through widespread fraud in the market of the low-priced securities, a report issued today by a group of state securities regulators said. However, the official SEC definition[1] of a penny stock is a low-priced, speculative security of a very small company, regardless of market capitalization or whether it trades on a securitized exchange (like NYSE or NASDAQ) or an "over the counter" listing service, such as the OTCBB or Pink Sheets.

So when investing in penny stock trade, consider getting a broker. Allot of traders, especially the novice ones, don't even try to put a penny stock that they have come across under their watch list radar hence missing easy to catch positve price advances.

Prices

Prices of penny stocks are very volatile. With GOLD prices hitting record highs, precious metal mining stocks have recently enjoyed unprecedented success.

When there are only one or two market makers, there is a risk that the dealer or group of dealers may control the market in that stock and set prices that are not based on competitive forces. In fact, trading in pennies is highly illiquid, and prices are often manipulated by forces not at all related to the business.

Penny Stocks are by nature cheap yet there are those who want to find the cheapest and most undervalued penny stocks they can find to maximize their investment even more. Penny stocks are a nightmare for every broker, analyst, and financial advisor. Penny stocks are not traded on a stock exchange but are traded in the over-the-counter (OTC) market. While it is true that penny stocks are not easy to sell, investors still believe in investing in penny stock trading because of its huge potential leverage.