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Learn a Little about Discount Stock Trading

Discount Stock Trading Can Be Very Profitable

Discount Stock Trading

Many traders prefer discount stock trading to any other investments. They make some good points in their own defense. For instance, high-priced stocks are very attractive because their large price tags make you think that you could earn a lot of money. However, the highest-priced stocks often demonstrate limited performance. Many of them are already at their peak price and will only grow slowly from there.

Discount stock trading, on the other hand, opens the doors to a lot of possibilities. When you buy a stock at a low price, it has greater potential to give you returns of exponential size. After all, when you buy that large cap stock for $100 per share, what are the chances that it will double in value? If its share price increases one whole dollar, then that is just a 1% return for you.

Try that same math with a discount stock trading at two dollars. Imagine that you spend $20,000 to buy 10,000 shares of this stock. After its value increases by one dollar, you will earn a 50% return. That means that your profit will be $10,000. The same investment in that large cap stock would have returned almost nothing.

Where You Can Find Out More about Discount Stock Trading

Penny stocks are some of the most controversial discount stocks available to the average investor. Their extremely low prices create potential for incredible earnings. Their critics will gladly point out a number of dangers inherent in these stocks. You may not want to invest in them after a little research but their proponents generate a long list of penny stock newsletters. You can find some of these on the Internet and see what they have to say about discount stock trading.

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