Penny Stock Fortunes - Where To Find Penny Stocks Online

What are Pink Sheet Stocks? Have you ever heard of them?

Well, to put it simple, "Pink Sheet Stocks" are just another name for penny stocks. They are over-the-counter stocks, which are not included in the daily NASDAQ listings. The stocks of well-known companies like General Electric and Microsoft trade on major exchanges such as the New York Stock Exchange (NYSE) and NASDAQ. But these companies must be listed - that is, accepted for trading purposes by a recognized and regulated exchange - prior to actually trading on an exchange.

When a company isn't listed, it often will trade on the Pink Sheets or the Over the Counter Bulletin Board (OTCBB). In simpler terms, A stock that doesn't trade on a major exchange is said to trade over the counter (OTC). Penny stocks are some of the cheapest stocks you can buy, they can literally be purchased for pennies per share. You can find $.20 and $.30 cent penny stocks all day long. You can purchase thousands of penny stocks without ever breaking the bank.

Read on to find out how I stumbled onto a penny stock newsletter (a service that provides trade recommendations on top penny stocks) and why pinning your hopes on penny stocks could make you fortunes.

Click Here To Check It Out.

There are a few things you should know before you invest in penny stocks, whether you are a novice or seasoned trader makes no difference when trading in the pink sheet arena.

Never invest more money than you afford to lose.

We all know penny stocks are priced low for a reason. The companies are usually in early developmental stages with not much operating history under their belts. As a result, their trading can be sporadic and volatile.

Look for companies with some trading history.

Make sure the stock has at least several months of a stable trading history. Make sure you are patient when you are searching for a penny stock. It can be difficult to determine the direction of a penny stock using the same indicators you would use with the big boys. It is best to miss a little bit of profit rather than getting caught during a huge selling cycle.

Check to see if the company has published any press releases.

In my mind, press releases equals the management understands the importance of shareholder value. They know what sharing their story with the public will do for their company. After all, penny stocks are traded by exposure. It is important that the public know that the management team is actively trying to accomplish the goals of the company.

Avoid the "pump and dump" at all costs.

"Pump and dump" is when a stock is pumped up in price so the sellers can get out of their shares. One indicator is when a huge amount of volume coming into the stock with little to no share price fluctuation. You need to make sure you have access to a good service that can monitor the penny stocks so you can steer clear of this. A service will help you minimize the leg work on your part. Why not rely on experts to do the research and due diligence before you buy a stock.

Always have an exit strategy.

You need to know when to buy and more importantly when to sell. Never buy a stock without an exit strategy. If you get too greedy and don't follow your original plan, you could end up losing.

Click here to learn more about these strategies.

I had a very successful career in Corporate America making well over six figures a year. During that time I dabbled in the stock market with what I thought was some pretty good success, I averaged about a 7 - 8% return a year. It wasn't making me a millionaire, but I was happy. Then came a decision that my husband and I made that changed our lives. We decided to have kids. With that decision, I made the commitment to be a Stay-at-Home Mom. At the time, I knew it would be hard to give up my income to raise my kids. However, I didn't realize just how hard.

The first year we really didn't change much of our life style. Instead we lived off of our savings and without any extra money, I stopped investing in the stock market. When our savings was almost gone we realized we had to make some major changes. The next two years were much more tough then I anticipated. Yet, I still didn't want to go back to Corporate America and give up the opportunity of raising my girls.

I was at the park with a couple of my girlfriends and their kids for a play date, when one of my girlfriend started telling us how she had been trading penny stocks. She used a stock investment newsletter online. The newsletter sent her signals on which penny stocks to buy, and when to sell. She said she had been using this penny stock screener for the last couple of months and she was doing extremely well!

I was skeptical about penny stocks because of lack of information on my part. And I was definitely not a fan of stock trading programs. I had used them in the past. They were expensive and they never seemed to increase my returns. My girlfriend wrote down the name of the website and told me to check it out. I must admit, I put the paper in my diaper bag and didn't give it much more thought. But, It's funny though, how things work out... about a month later my husband came home and told me an associate of his was making a killing in penny stocks. That rekindled my interest and I invited my girlfriend to lunch so I could learn more.

As soon as I got home I visited the website she used. I have to say, I was impressed. First of all, it was a lot cheaper then I thought it would be. I could even afford it! Second of all, they give a money back guarantee, no questions asked. It all looked pretty good. It was a way I could stay at home with my girls and still make substantial money. I was about ready to take the plunge and then I reminded myself that the whole point of their impressive website was to entice me to order their services. Being the skeptic that I am, I waited. Long story short, I met my girlfriend and kids at the park again and she told me she had over doubled her money! After much discussion with my husband, I joined. And I am so glad I did. I only wish I hadn't wasted so much time deciding.

The biggest ADVANTAGE of trading penny stocks is how fast the return of investment comes. I have made many trades that have gone up 40 -100% in just 24 hours. I never saw that kind of increase in the large cap stocks I use to invest in before. More importantly, it doesn't take that much money to invest in penny stocks, but the profits you can make are incredible. It may become crystal clear if I give you an example:

You invest $1,000 in a stock at a price of $40, which buys you 25 shares. In order to make a 50% return on investment the stock would have to increase to $60.

OR, you can invest $1,000 in a stock at the price of $.40 cents, which buys you 2,500 shares. In order to make a 50% return on investment the stock would have to increase to $.60 cents. Which scenario do you think is more likely to happen sooner?

Now if you are looking for a crystal ball that is going to make you 100 - 200% returns on every stock you purchase and turn you into a multi-millionaire overnight - then I am sorry to tell you, that doesn't exist. But you probably already new that. However, if you need a "one stop solution" to finding great penny stocks, then I highly recommend you check it out.

For more information about this stock investment newsletter, click here.

There is nothing better than an undervalued penny stock! You can increase your income and greatly improve your profits when you buy them. BUT, you must be able to verify which penny stocks are undervalued and which ones should be left untouched. If a penny stock is selling for $.25 cents, but can be determined to be worth $1.50 based on expected future cash flows, then it is an undervalued stock. The 3 tips below will teach you how to find undervalued penny stocks online.

TIP 1: A Low Debt-To-Equity Ratio

The debt-to-equity ratio (D/E) is a ratio representing the proportion of shareholders' equity and debt used to finance a company's assets. The two components are often taken from the firm's balance sheet. But the ratio may also be calculated using market values for both, or using a combination of book value for debt and market value for equity. If a company has a low D/E it may be an undervalued penny stock. This equation is particularly helpful in weeding out companies that carry high debt.

TIP 2: Evaluating The Price-To-Earnings Ratio

The price-to-earnings ratio (P/E) of a stock is a measure of the price paid for a share relative to the profit earned per share. It is a ratio used for valuation: a higher P/E ratio means that investors are paying more for each unit of profit, so the stock is more expensive compared to one with lower P/E ratio. The P/E ratio illustrates investor demand for a company's shares. The higher the percentage the P/E ratio is, the better the chances of that company being a great investment. One exception to this rule: If the P/E is exceedingly high, it could be a signal of a market bubble that is almost ready to burst. You don't want to be holding shares when the bubble pops. A very low P/E can signify an undervalued stock.

TIP 3: Compare The Compound Annual Growth Rate

The Compound Annual Growth Rate (CAGR) is a phrase used to describe the growth over a period of time of some component of the business, for example, revenue. This formula allows you to determine what the investment growth rate would be if the company grows at a steady rate. Because CAGR diminishes the effect of volatility of irregular returns and represents annualized gain if the returns are smoothed out, you get more accurate information and can make better investment choices.

Sounds like a lot of work? It is! If you want to simplify the process, check out this penny stock newsletter. They are pros at finding undervalued stocks, which saves me time and allows me to spend more of it with my family. You might want to look into using one as well. You can click here for more information. They really help in taking the risk out of investing, especially for people who do not have the experience or the time needed to thoroughly do the research.