Home » Finance

Penny Stocks A Profitable Roller Coaster

May 6, 2008
New investors are being drawn by the appeal of what is known as penny stocks because of the low price and the potential for quick financial growth which can soar as high as as one hundred percent or more in just a few days. But, on the down side, severe loss can occur just as quickly and many penny stocks can lose all of their value in the long term market. Some people will warn you that penny stocks are too high risk to invest in and that new investors should do their homework to be aware of the risks that are involved in penny stocks. These risks include limited liquidity, little or no financial reports, and, of course, fraud.

But, many new investors have had a great deal of good fortune with penny stocks. Even though a penny stock has fewer shareholders, and it will not trade as many shares per day as a larger company, penny stocks can still afford a newbie in the trading game an excellent opportunity to make a lot of money quickly that maybe invested in other strong companies.

As with any type of stock, a sudden change in the demand of a certain stock can lead to a great deal of volatility in the price of any company stock. This lack of liquidity with penny stocks can send a stock price soaring up very quickly, but it can come crashing down just as quickly. So making sure that you closely watch the penny stock market can help you make some shrewed investments that can have some very high payoffs.

Even with the lack of liquidity and volatility of penny stocks they can still be an ideal investment for many people who have the desire to increase their personal financial holdings and get the feel of trading and investing the stock market. Finding a good and reputable stock firm is the best idea for starting to deal in penny stocks. This helps to minimize financial loss and helps to avoid any fraudulent penny stocks that have become a common area for online scam artists.

So, if you have the desire to jump into the world of the stock market, but don't want to invest a lot of your hard earned cash try penny stocks. They can be well worth the effort for short term income growth and lead to bigger and better things.

All stock trading activities cost a fee and they have a certain amount high level of monetary risks especially for the unwise and inexperienced stock traders and/or investors seeking for a quick and easy way to make a lot of money in a short period of time. Also, stock traders and investors will have to deal with the costs of commissions, taxes and fees to be paid for the brokerage services. There is a myriad of fiscal obligations that must be observed, as well as the taxes that are charged by a particular state on the transactions.

Many companies offer courses in stock picking, and many have reported a great deal of success through technical and fundamental analysis. Many economists and academics have stated that because of what is known as efficient market theory it is unlikely that no matter the amount of analysis that one can do, it will not help an investor make any gains above the stock market itself.
About the Author
Learn how to trade Penny Stocks and get Stock Trading tips.
Rating:
Please Rate:
(Average: Not rated)
Views: 149
Print Email Report Share
Article Categories
    • Artists
    • Gambling
    • Humanities
    • Humor
    • Movies
    • Music
    • Photography
    • Tattoos
    • Television
    • Classic Cars
    • Motorcycles
    • Recreational Vehicles
    • SUVs
    • Trucks
    • Vans
    • Branding
    • Business Opportunities
    • Careers and Jobs
    • Corporate
    • Customer Service
    • Direct Mail
    • Entrepreneurship
    • Ethics
    • Financing
    • Franchising
    • Home-Based Business
    • Human Resources
    • Import and Export
    • Leadership
    • Management
    • Market Research
    • Marketing and Advertising
    • Negotiation
    • Network Marketing
    • Networking
    • Organizational
    • Presentation
    • Project Management
    • Public Relations
    • Small Business
    • Strategic Planning
    • Team Building
    • Telemarketing
    • Training
    • Data Recovery
    • Databases
    • Games
    • Hardware
    • Networks
    • Operating Systems
    • Programming
    • Security
    • Software
    • Spyware and Viruses
    • Ask an Expert
    • College and University
    • Home Schooling
    • K-12
    • Languages
    • Online Education
    • Psychology
    • Coffee
    • Cooking
    • Gourmet
    • Recipes
    • Wine and Spirits
    • Acne
    • Aerobics
    • Alternative Medicine
    • Beauty
    • Cancer
    • Cosmetics
    • Depression
    • Diabetes
    • Diseases and Conditions
    • Fitness Equipment
    • Fitness
    • Hair Loss
    • Heart Disease
    • Medicine
    • Men's Health
    • Muscle Building
    • Nutrition
    • Skin Care
    • Supplements and Vitamins
    • Weight Loss
    • Women's Health
    • Yoga
    • Arts and Crafts
    • Babies
    • Collecting
    • Elderly Care
    • Genealogy
    • Hobbies
    • Parenting
    • Pets
    • Pregnancy
    • Woodworking
    • Feng Shui
    • Gardening
    • Home Appliances
    • Home Security
    • Interior Design
    • Landscaping
    • Affiliate Programs
    • Article Marketing
    • Auctions
    • Audio
    • Banner Advertising
    • Blogging
    • Broadband
    • Domain Names
    • E-Books
    • E-Commerce
    • Email Marketing
    • Ezines and Newsletters
    • Forums
    • Internet Marketing
    • Link Popularity
    • Pay-Per-Click
    • Podcasting
    • RSS
    • Search Engine Marketing
    • Search Engine Optimization
    • Security
    • Social Media
    • Spam
    • Video
    • Viral Marketing
    • Web Design
    • Web Development
    • Web Hosting
    • Copyright
    • Cyber Law
    • Intellectual Property
    • National, State, Local
    • Patents
    • Regulatory Compliance
    • Trademarks
    • Buying
    • Selling
    • Baseball
    • Basketball
    • Boating
    • Cycling
    • Extreme Sports
    • Fishing
    • Football
    • Golf
    • Hockey
    • Hunting
    • Martial Arts
    • Running
    • Scuba Diving
    • Soccer
    • Swimming
    • Tennis
    • Dating
    • Divorce
    • Marriage
    • Weddings
    • Astrology
    • Buddhism
    • Christianity
    • Faith
    • Hinduism
    • Islam
    • Judaism
    • Meditation
    • Metaphysical
    • New Age
    • Cable and Satellite TV
    • Cell Phones
    • Communication
    • Gadgets and Gizmos
    • GPS
    • Satellite Radio
    • Video Conferencing
    • VoIP
    • Addictions
    • Coaching
    • Goal Setting
    • Motivational
    • Stress Management
    • Time Management
    • Clothing
    • Electronics
    • Fashion
    • Gifts
    • Jewelry
    • Causes and Organizations
    • Environment
    • History
    • Holidays
    • Men's Issues
    • Nature
    • Philosophy
    • Politics
    • Women's Issues
    • World Affairs
    • Air Travel
    • Camping
    • Cruises
    • Destinations
    • Outdoors
    • Article Writing
    • Book Reviews
    • Copywriting
    • Fiction
    • Non-Fiction
    • Poetry
    • Quotes
    • Screenplay
    • Tools and Resources