A Guide To Penny Stocks

Penny Stocks Have Great Potential
By Billy Akerman

Buying penny stocks can have great potential,that can be either good or bad. You can double you initial investment in no time, but lose it just as quick. When I say double or triple your portfolio you may think that it's not easy for that to be done.

Think about it, you have 100 shares of a company (we'll call it XYZ) that are price at $1. That makes your portfolio worth $100. The company has annual revenue at about $100,000.If that company goes ahead and increases their revenue three fold to $300,000 per year. The stock of the company typically will go up about the same percentage. Now your portfolio is worth $300

For small companies to increase by large percentages, it won't take much for that to happen. A new contract from the military can do that (like what happen to MMGW). For Exxon-Mobil to do that they would have to increase annual revenue by over $7 billion.

Penny stocks are very attractive to most amateur traders. That could be because of the "cheapness" of the stocks. You can buy 5000 shares for as little as $50. More Google searches are done for penny stocks than blue-chips and dividend paying stocks combined. It's amazing to see that more people would want to trade penny stocks than trade commodity stocks. the volatility is just as active, but with penny stocks, you're dealing with companies that have no proven track record for the long haul.

The average "Joe's" of America want to hit it big. They want to hit the lottery and buying penny stocks gives them that same feeling as going the horse track or even Las Vegas. The problem with that is that means they're playing with their emotions involved. That will do no one any good. trading in the stock market when your emotions are involved can only lead to poor decisions.

For more information on Buying Penny Stocks, please go to http://buyingpennystocksonline.com
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Managing money with an open hand is hard. But, Jim Cramer is so committed to helping people learn that he created a charitable trust portfolio to show investors how and why he makes trades.

For over 10 years Jim Cramer was a successful hedge fund manager and now he writes for RealMoney.com. Over the years he has developed a strict set of investing disciplines that have helped all kinds of people be successful through any market.

He created a service called Action Alerts PLUS, which allows people to follow along as he makes his own trades.

What You Need to Remember When Buying Penny Stocks
By Billy Akerman

When you want to buy penny stocks, you need to be aware of a couple of things. Buying stocks is not an easy thing to do. Here are a some steps that will help you through it.

First you need to realize that buying penny stocks are harder to do than other established stocks like Google, Yahoo, or even Wells-Fargo. Company's that have been around awhile and a proven leader, It easy to track their records, study the trend, research the company's financial report and balance sheet.

A company that is considered a penny stock is usually new and haven't released a lot of information. When you try to do what I like to call "doing my due diligence", it's difficult to find past earnings reports since they don't have to report every 3 months like most stocks do.

Next, leave your emotions at the door. It's hard to deal with the stock market with it's volatility and so forth, but when you deal with penny stocks it even more unpredictable. The trading of these stocks don't happen constantly throughout the day. The price may sit at the same level all morning and then in the afternoon it might drop 10-30% for no hard reason. Emotions will get the best of you if you're not careful. If the price of a stock drops too far, you may have a knee-jerk reaction to it and sell before you had time to figure out why it dropped.

If the price goes up rapidly, you might get giddy and happy that it moved up 50% in one day. Thinking that you have a winner here expecting it to go up the next day, you "let it ride" instead of selling. Only to turn on you computer and see that the stock is now lower than where you bought it at.

There's a lot to think about before getting into trading stocks.

For more information on Buying Penny Stocks - please go to http://buyingpennystocksonline.com
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Were You Thinking of Buying Penny Stocks?
By Billy Akerman

Were you thinking of buying penny stocks? You're not the first to thinking that they will find the next Google while it is still less than $5.00. Many stocks that trade on the markets were once valued at less than that. To be considered as penny stocks, most will say that the stocks value is $5 a share and then there are others that say $1 or less. Whatever the difference, buying stocks that are low valued doesn't mean that you'll become the next Warren Buffett.

There are many brokers out there that will sell you stocks that are valued at $5 or less, but be advised that not all brokers should be trusted. Brokers make their money by selling stocks to you. They may not be very forthcoming to you with all or correct information. There are many online brokers that make claims of investing in a company and in a few short months and their gains are 500% or better. What they don't tell you is that the company was one of a hundred that they've invested in. The other ninety nine companies have lost value or are completely bankrupt and they lost all the money that was invested.

Anyone that would tell you that they can and will make you money is not a professional. A broker may tell you that he has some insider information on a stock. Let me tell you now that that can't be further from the truth. It is illegal for anyone with inside information to share it with someone who not on the inside. Executives of a particular company need to inform the share holders of anything he/she does in regards to buy or selling any of the company's stock. Martha Stewart went to prison because she received inside information on her company and sold some of her stocks in the company.

When you're thing of buying penny stocks, don't listen to just anyone. Research the company yourself.

For more information on Buying Penny Stocks, please go to http://buyingpennystocksonline.com
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