Buying penny stocks can be both fun and profitable. But, and it’s a BIG but, only if you know what you are doing. There are qualitative and quantitative aspects to buying penny stocks and both of these elements need to come together most times for things to work out in the favor of the adventurous day trader. Why adventure? Because, as you’ll see below, how to buy penny stocks has wrapped inside its universe, a certain truth, a pungent ring of excitement and daring, and profits.
Let’s start with the adventure. Part of the journey with penny stocks and free stock alerts is to understand that they are by any stretch the only trading instruments that can turn the ordinary guy or gal day trading into an overnight super star. The business world is filled with guys and gals who bought into this one truth and have made millions. As a matter of fact, there’s a young man who made a whopping $300K before he was 20! Penny stocks by virtue of them being stocks that trade under $5, are awesome vehicles for accelerated upside opportunities. One day a trader could see a small $500 investment mushroom into $10,000 all because a penny stock moved 1900%. Contrast that sort of adventure with the long, slow, crawl of blue chip stocks that move at best, 1 to 3%. It should be quite obvious based on those realities that blue chip stocks are for 90-year-old men and women from Omaha – the sages; the ones that can do with a 3% move when it translates into around $20M because they bought 50M shares in Coca Cola back in the 1950s. Yes, penny stocks are for the now generation. They are for the people who want to get rich – fast!
Adventure out the way; let’s move to the qualitative nature of how to buy penny stocks. Sadly, not all penny stocks are created equal. Two could be trading for the ridiculously low price of $0.0001, but perhaps only one will have the best upside potential. How do you pick the best one? The answer is a bit nuanced. You see, a day trader could take the view that a penny stock that’s in the virtual reality market, say, is a better buy than say one in oil and gas. On some levels they’d be right; but what if the virtual reality company has bad management; what if they have a bad product, or un-scalable technology? All these things can impact the future growth potential of a penny stock. It is wise therefore to choose only those penny stocks that pass strict criteria for growth and near term returns.
The absolute best news you can happen upon is this: criteria for picking the best penny stocks are often safely worked out by people who have resources, time, and the desire to serve up great work in picking stocks. These are purists; people who believe in doing the best of anything, for anyone. Restless day traders spend the years it takes honing their own criteria; smart day traders get right into the game by leveraging the help of these penny stock purists who run newsletters and make as much money as they possibly can. That’s how you buy penny stocks, young grasshopper – now go out there and put your dent in the universe – and upset old people from Omaha while you are it.