Posted on 16 August 2012.
Hot penny stock picks are listings of companies that are likely to produce major profits for investors if they are accurate in their timing and careful to implement the right investment strategies. These are usually businesses that are poised on the edge of significant and positive change. Upon reaching these lists, many of these companies will often make important news announcements that result in several days worth of gains that savvy investors can benefit from. Getting your hot penny stock picks from the wrong resources, however, is a sure way to get burned when casting your money into the pot.
Most hot penny stock picks are offered for free and investors can acquire these listings from a very vast number of sources. Getting well-analyzed and valuable data is something that you can only be assured of doing when you use a reputable and worthy resource. It is also important to remember that using hot penny stock picks to choose your investments will never negate the need for conducting in-depth research. These listings merely represent the best companies to invest research efforts in and not necessarily your money.
You will still need to check for growth potential on your own in order to avoid common scams such as pump and dump schemes, listings for companies that are poised to go out of business and other tricks of this trade that serve to give this area of the market a bad name. Investors must look for earning histories and solid business plans for each of these endeavors. Using limit orders, rather than market orders and making smaller investments when company business plans are less than transparent are some of the ways that you can avoid major losses.
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