Posted on 10 August 2011.
It is no secret that pharma stocks are one of the hottest investments on the pink sheet market. There are a number of reasons for this. The first reason has to do with advances is pharmaceutical technology. As scientific understanding of biotechnology increases, an increasing number of high-quality pharmaceuticals are being released to the public. The second reason has to do with the continuous demand for these products. Those who rely on pharmaceuticals for their comfort and health are more than willing to keep buying them, and are usually quite willing to try out new and experimental products. While many sectors have suffered at the hands of the economic slump, pharma stocks have remained a sound investment for many investors.
The nature of the stocks themselves is also something that potential investors should consider. Most pharma stocks are sold as penny stocks on the pink sheet markets. These stocks carry a number of risks and benefits. Most represent new products and experimental drugs that have yet to prove their market value. Additionally, pink sheet stocks are not required to be certified by the SEC, do not need to list any financial information and, in fact, have no minimum requirements at all. These stocks are a low-cost investment, however, as they are priced at less than five dollars a share. Additionally, many represent up-and-coming pharmaceuticals that could make quick gains and have lucrative returns.
There are a few things you can do to make sure that you make a sound investment. The most important thing is to research each company. While some companies are known for rushing pharmaceuticals to market, others are known for taking their time to get each product right. It is important to make sure that you invest in the second type of company. Researching a company’s financial history is also an excellent way to make sure that your investment in pharma stocks is a positive experience that earns you a large return.
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