How Do People Make Lots Of Money From Penny Stocks?
Penny Stocks. Two words that make some investors salivate and other investors cringe! Some people look at penny stocks as though they are an extremely risky investment that will end up costing them money. However, other people realize that these stocks, if they can pick the right ones, have the potential to make them very rich!
Today we're going to go over some tips on picking hot penny stocks. If you can buy them at the right time, there is lots of money to be made. Many people have multiplied there original investment many times over just by buying the right stock at the right time.
However, you can't just blindly pick a penny share and hope it goes up. Well, I suppose you can but it's not a very good strategy!
Instead, there's a few things you can look at to increase your chances of picking a winner that can make you some good money.
First off, I aim to pick a company that is in an industry that is growing. The last thing you want is a small company that is in a dying industry. You want the product or service that they are selling to be in demand and have a strong future.
Second, its important to have a solid management in place. You can typically find information about the board of directors and management on a company website or filing. Have a look at their background, and more importantly, if they've been involved in any failed businesses or criminal activity (can run a search on Google to help with this).
Lastly, these types of stocks are often impacted by momentum and price action. Sometimes there's a buzz about a certain stock and buyers will flood into the market and cause the price to shoot up. These stocks normally don't trade in high volumes, so if you'notice that trade volume is picking up, it's possible that the stock is getting more attention and could be ready to move.
In fact, there many people who have made tremendous amounts of money focusing on price and volume movements. There are even software programs designed to point out stocks that have the potential for a large price movement upwards.
Whether or not you decide to invest in penny stocks, two facts clearly stick out. First, you have to put some effort into picking out winners and finally, you can make an enormous amount of money if you pick the right one!
About the Author
Check out http://www.daytradingmagic.com to learn about a trading system that you can use to make money with penny stocks!
Tell others about
this page:
Comments? Questions? Email Here