Posted on 12 April 2012.
If you are a new investor, 1 dollar stocks can seem a bit frightening. They are certainly less expensive than most, but many would-be investors may find themselves worried about the low asking cost. How can one make money, you may ask yourself, if the initial investment is so low? There are no guarantees that these stocks will pay off, of course, but they do represent the opportunity for new investors to get into the game quickly and to turn a quick profit.
Why are they so inexpensive?
There are many reasons for the low cost of 1 dollar stocks. Some may be offered by new companies, while others may be offered by more established names. Many of these stocks are offered by established businesses that have faced recent setbacks, and a smart buyer can take advantage of the low price if he or she thinks that the company is on the verge of a comeback. The lower price generally means less risk for new investors, but it also generally means less reward. In either case, though, these stocks present a valuable learning opportunity for those that wish to begin playing the market.
Is it wise to invest in 1 dollar stocks – only if you are looking for a small profit with minimal risks. These stocks can be wonderful for those that want to feel like they are getting a good deal or simply wish to invest in a stock without much monetary investment, but they will rarely make you rich. If you wish to take a gamble on these stocks, though, you should be able to do so in a manner that will allow you to make at least a small profit. A bit of research is needed to find the right stocks, but it is always possible to find a good investment for a low price.
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