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Potential Riches from High Risk High Reward Stocks

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The Stock Market Lottery: High Risk High Reward Stocks

High Risk High Reward StocksThere is a particular allure to high risk high reward stocks that make them attractive to many investors. There is a potential to become filthy rich overnight with the right pick. Many investors turn to the biotech companies for these extreme make or break deals due to their ability to produce huge returns. Of course, on the other hand is the possibility that the investment will end up washing away in a deluge of FDA rejections and failed trials. Some responsible and savvy research is vital to improving one’s chances with these lottery-style investments.

The Success of High Risk High Reward Stocks is Dependent on Many Factors

The biotech industry seem to always be either releasing some obscure drug or on the brink of doing so. For any new drug to hit the US markets, it must receive FDA approval. Clinical trials are an important part of this process, as the name implies, there are no guarantees that the drug will ever reach production. High risk high reward stocks exist to entice investors to put their money on something that is not a sure thing. The biotechs need investor funds to create new drugs and conduct these trials, with the hopes that a successful product will earn large figures for the company and pay significant returns to investors.

The role of the investor in biotech firms is to continually monitor the progress of their high risk high reward stocks. The media is fast to report failures and successes of pharmaceutical trials, staying current and up to date on the developments of the firm in which money is invested is a great way to protect an investment. The trials have to meet a minimum number of participants in order to be qualified as productive, without this number being met, the FDA has the right to deny a passing grade to the trial as a whole. This volatility and lack of stability is what makes biotech firms high risk high reward stocks.

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