Why Stocks for a Penny Are Worth More than They Seem

Even in the world of penny stocks, buying stocks for a penny is considered to be an incredibly low cost investment. In general, penny stocks range from costing a few cents per share to costing several dollars. By definition, each share must cost less than five dollars if the stock is to be considered a penny stock. Stocks that cost a single penny per share, however, are seen by many investors as too small and inconsequential to be worthwhile.

In spite of the fact that investors have been reluctant to buy stocks for a penny, these low-cost shares are slowly growing in popularity. This is largely because of the persisting global economic crisis. With many of the regular markets still in a sorry shape, the penny stock market has been picking up steam. Investors who lost everything when their big investments went bad are slowly picking up the pieces by buying the only shares they can afford. Investors are also encouraged by the fact that many low cost stocks are owned by companies that are just starting out. If a company has a solid product or service, it may yet find its niche. When shares cost only a penny, investors can afford the risk of an untested company. If the investment goes bad, little money is lost. A successful investment, however, can turn a few pennies into many, many dollars.

 Finding the Top Stocks for a Penny

If you want to invest in stocks for a penny successfully, it is imperative that you identify the companies that will be successful. Because many of these companies are new, and their products are untested, however, this can be difficult. Although it is possible to research the company’s structure and the history of its management, online tip sheets can help you make decisions much more quickly. Online tip sheets do the research for you, highlighting the stocks that are sure to go far. They will save you time while looking for the best stocks for a penny and can help you make large returns.