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Why Cheap Healthcare Stocks Are the Place for Your Money

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Cheap Healthcare Stocks

Have You Been Avoiding the Cheap Healthcare Stocks?

A lot of investors are coming into the healthcare sector for the first time. If you are among them, do not let yourself be dazzled by the array of high-priced healthcare provider stocks and overlook cheap healthcare stocks. It is always tempting to buy stocks with high values. However, any amount of experience in trading will show you that higher-priced shares have a more difficult time generating returns than those with lower market values.

The Unexpected Power of Cheap Stocks

It is all in the mathematics. If you are motivated by the recent reform to healthcare to purchase stocks in this sector, then you should look carefully at some of the lower-priced shares on the market. They have much more ability to create exponential returns for you.

Imagine that you set aside $50,000 to invest in this new sector. If you sank all the money into a stock worth $100 per share, you would only be able to buy 500 shares. Even though that company had a spectacular day and gained $5 per share, your total profit would be just $2,500.

If you had put that money into a stock worth just $5 per share, the outcome would have been incredibly different. You would have purchased 10,000 shares of the company’s stock. The stock would only need to gain a quarter to equal the gains made with the other stock. If the share price went up a dollar, you would reap $10,000 in profits. It is always more important to own a lot of stocks than a stock that is worth a lot.

There are a lot of cheap stocks in the healthcare sector now. Plenty of small companies are taking a shot at this burgeoning market. Research them well and find the one that you think is going to make it.

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