Penny Stock

MSheldar22 · #1 (**permalink**) 12-20-05, 01:44 AM

I heard these are the way to go to make money really really fast. But, wouldn't there be like a downside to buying a penny stock as well? How many pennies can a stock really be worth?

Yee Sian · #2 (**permalink**) 12-20-05, 04:17 AM

http://www.investopedia.com/terms/p/pennystock.asp

A stock can be worth any amount of pennies, really

. The reason why you make make money really fast is because the amount you make depends on the percent by which the shares you own rise.

So, when you buy X shares, worth 30cents each, and they move up 30cents, you have doubled your initial investment. On the other hand, if you bought X shares worth $3 each, and they move up 30cents, you get only 10% profits.

Personally, i'll keep any from these penny stocks unless i really know what I am doing. They have a risk of becoming worthless, so yup, i'll rather keep away from them for now(beginner that i am

). You can ask Spence about them though, he knows a bunch.

Kristy411 · #3 (**permalink**) 12-21-05, 12:56 PM

Yee Sian and Blain, you're both awesome for answering these questions, I'm sure they're helping a lot of the viewers on the forums. I've learned from them too!

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Anything the mind can conceive and believe, it can achieve. - Napoleon Hill
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roy3433 · #4 (**permalink**) 12-21-05, 01:09 PM

Quote:

Originally Posted by MSheldar22

I heard these are the way to go to make money really really fast. But, wouldn't there be like a downside to buying a penny stock as well? How many pennies can a stock really be worth?

Normal kind of stock and penny stock the different?or are they the same?

spncr2 · #5 (**permalink**) 12-21-05, 02:31 PM

Penny stocks are alot cheaper than other stocks, meaning you can buy a larger supply of them. Buying penny stocks can mean 1 of 2 things- Alot of profit, or a HUGE loss. Basically the more of a stock you buy, the more of a risk factor comes in to play. Make sure to deduct commision fees with that as well.

Hope this helps, and good luck!

roy3433 · #6 (**permalink**) 01-08-06, 04:46 AM

Quote:

Originally Posted by spncr2

Penny stocks are alot cheaper than other stocks, meaning you can buy a larger supply of them. Buying penny stocks can mean 1 of 2 things- Alot of profit, or a HUGE loss. Basically the more of a stock you buy, the more of a risk factor comes in to play. Make sure to deduct commision fees with that as well.

Hope this helps, and good luck!

well.... is penny stock really that risky than common stock?

JGotti · #7 (**permalink**) 01-08-06, 02:56 PM

this is basic business Risk vs Return, the bigger the risk the greater the return u expect, and vise evrsa

Jack Haddad · #8 (**permalink**) 01-09-06, 02:00 AM

Be careful of penny stocks (OTC)! Theyre highly manipulated by market crooks. Besides, one can never enter and exit a trade at the desired moment.