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Before You Invest in Sub Penny Stocks

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Sub Penny Stocks

The Profitable World of Sub Penny Stocks

Some people draw the line at sub penny stocks. Investing in penny stocks is a dangerous activity that also presents certain possibilities for profit. However, sub penny stocks are a basement to the dangerous edifice made up of penny stocks. These are stocks issued by companies that are often on the very edge of existence. As with any stock, though, this extreme danger provides an extreme opportunity for profit.

The possibilities should be easy to imagine if you are already a penny stock investor. If you buy shares of a company worth one-half cent each, then those shares need only to gain another half-cent in value in order to double the size of your holdings. The possibilities increase exponentially as the values of the shares decrease.

Tips for Investing in Sub Penny Stocks

If you are going to invest in sub penny stocks, then you should keep in mind a few simple guidelines to follow in order to preserve your wealth.

• Be prepared to lose your entire investment. This is not just a possibility. When you buy sub penny stocks, you can rest assured that you will lose some of your investments entirely. It is that risky. The good news is that even when you buy 100,000 shares of a half-penny stock, you stand to lose only $500.

• Do not be afraid of volatility. Volatility is your friend when you invest in sub penny stocks or any other stocks. You can use volatility to your advantage when you follow another critical rule about these investments.

• Diversify. When volatility sends one of your sub penny stocks into ruins, it may simultaneously make one of your share prices skyrocket.

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