Finance and Credit Professional

Penny stocks give investors with a smaller cash flow the opportunity to experience large gains. Of course penny stocks are not just for the investor with empty pockets but usually those with tons of money dont concern themselves with micro-cap/penny stocks. This is for a couple reasons. One reason is investing too much money can move the market too much. The other is than usually dont mind slow gains.

You can rarely have a discussion about penny stocks without mentioning the risks associate with such an investment. One of the things to keep in mind when investing in penny stocks is that dont trade frequently like larger cap stocks typically do. How can this be a problem? Well, if you decide you want to do a quick buy and sell on a stock it may not be as easy as you would like. The stock goes up and then you decide to try to sell but not enough people are buying for you to get out of the stock and take your profits. Its not impossible to get out but it can be a factor if you are day trading.

So why do penny stocks have a bad reputation? One major reason is that most spam emails about buying stocks are usually about penny stocks. This of course is coincidence considering the sensitivity of penny stock to any kind of activity whatsoever. Usually these types of email campaigns are pushing stocks worth less than a dollar in hopes of causing relatively big movement in the market.

Something to keep in mind is that penny stocks are not traded in the big stock exchanges like NYSE or NASDAQ. They are instead traded in whats called the Over the Counter Market or OTC. This is important to remember because it basically means they have not reached the big leagues yet as an established and well known company. They are certainly far from being in the S

Related News

China credit cards posted big 2006 loss-study (Reuters via Yahoo! Asia News)
HONG KONG, May 4 (Reuters) - China's credit card industry posted a loss of $232 million last year as mainland customers are unwilling to roll over their debt and further losses are in store for the industry, according to a report by financial services research firm Lafferty Group. ...more

Insurance claims could top £3bn (FT.com via Yahoo! News)
Insurers face more than £3bn of claims from the floods in June and July, forcing up the cost of insurance and raising questions about its availability, analysts have warned. ...more

The Most Intelligent Way to Eliminate Personal Debt (The Bradford Era)
(ARA) - Tired of feeling like you're living from paycheck to paycheck? Have interest charges driven your credit card balances so high, you feel like you'll never get out of debt? If so, you're not alone. ...more

Bad Credit and Home Refinance (Evening Times)
(ARA) - Mortgage rates are at historic lows, and it seems like everyone's jumping on the refinance bandwagon these days. But is it really a good idea for people with bad credit? ...more

BRIEFING - ASIA INFRASTRUCTURE - OCT 10, 2007 (Asia Pulse via Yahoo!7 Finance)
Asia Infrastructure   South Korea will need up to 730 billion won (US$798 million) to repair a North Korean railroad and an expressway as agreed at the latest inter-Korean summit, the country's top economic policymaker said Wednesday, adding that many of the inter-Korean economic projects can be handled without causing a huge burden on the state budget. ...more