Posted on 07 August 2012.
When searching for hot penny stock picks to purchase as an investment, trade volume is a key indicator of market attention. The most active stocks will produce the volatility necessary to generate the price changes that lead to big profits. Without market activity, a penny stock’s value will remain stable. Companies like Marine Drive Mobile Corporation (MDMC) and IDO Security Incorporated (IDOI) that maintain a larger trade volume should be considered as some of the best hot penny stock picks.
Volatility is the key to success in the stock market. Profits can only be made when prices are moving, so finding stocks that are moving is a top priority. Additionally, the fundamental principle of buying low and selling high must be accomplished too. When a stock is trading at a high volume and is experiencing a temporary dip in price, it should be considered as a potential investment.
By discovering this unique combination of attributes, the penny stock investor is giving himself or herself the best opportunity to achieve substantial gains. Price change is necessary, so there must be volatility in a company’s value, and the hot penny stock picks should be purchased when prices are down.
This approach to investing in penny stocks will reduce the risk of holding underperforming penny stocks that tie-up financial resources that would be better utilized in markets that are moving. The penny stock market is constantly presenting investors with profitable opportunities that meet this criterion, and the most successful traders will incorporate some variation of this approach into their investment strategy. Before a stock is purchased, its trade volume and volatility should be considered as these are key indicators that are associated with hot penny stock picks.
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