Posted on 25 August 2012.
A lot of investors like to spice up their portfolios by trading penny stock picks. This is one way to maintain a certain amount of diversity in your portfolio and have some fun while you are at it. However, there are a growing number of investors who make a living at trading penny stock picks.
In fact, some traders do a lot more than make a living. They earn fortunes on a regular basis because these seemingly insignificant investments all share a propensity for generating huge returns after the slightest fluctuations in stock price. As long as you know how to pick the winners, you can even watch your investments double in size over the course of a few minutes.
Profits are not guaranteed when you are trading penny stock picks. The same market volatility that can generate exponential returns can also wipe out an investment. Take these tips about trading penny stock picks and proceed with caution.
• Get good software to analyze price-performance patterns. These are the best indicators that you will have for determining when a stock price is going to surge.
• Find a good broker who will not charge too much for penny stock trades. Some of them offer free trades at the outset but the may charge a lot later. Get the best overall deal.
• Focus on those sectors of the market that are the most active at the time that you are investing. For example, energy and precious metals are very active at the moment.
• Subscribe to an alert or an email list that will give you the latest news about trading penny stock picks.
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