Hot Penny Stock
How to get started with Hot Penny Stock Investment?
Do not have enough cash to make an investment? You can start small. With hot penny stock you can purchase a share with as little as one dollar.
What are Penny Stocks?
Stocks at low price that start from one dollar to five dollars are basically penny stocks. The term “penny stock” known as small cap stocks or microcap is usually priced less than a dollar per share. These stocks are usually rolled out by small companies so it is difficult to find organizations such as Microsoft and Wal-Mart in penny stock section.
You should, however, remember that these companies were once really small. It is a challenge for penny stock investor to determine the next thing that will make it big. Never assume that since a share is just for $1 it is worthless to put your money in. Companies such as PETsMART, 7-eleven, and Jenny Craig started out with hot penny sticks and are now listed in NASDAQ and New York Stock Exchange.
How to find hot penny stock?
Unfortunately, these stocks are not covered by sources like the S&P 500, the Russell 2000, the Wilshire 5000 and the Dow Jones Utilities Average. The Walker’s Manual of Penny Stocks is one great source to find companies that come up with penny stock. This organization takes a look at startup companies that are good risks for penny stock investing. Another way to find genuine information is your financial advisor or broker.
Most hot penny stocks trade in OTC or over the counter market. These are quoted in the Pink Sheets or the OTC Bulletin Board rather than at New York Stock Exchange or NASDAQ. Check out the financial standing of the company whose share you want to buy. You can find the financial statement of companies who are registered on the SEC’s website. Check with the state securities regulator if the organization is not registered with the SEC.
Things to know before you invest
Like any other investment you should look for quality and not quantity. It is here your financial analytics will come into play. Find out whether a small company has the capability to turn out profits or not. Do thorough research and homework before putting your money in. Try to know the management of the company; what are they capable of and what their future plans are.
What is the growth potential of the company? Can it turn a small business start up into a profitable one? You should also look for: existing revenue stream, company’s valuation, history and longevity, financial solvency, number of employees and profitability.
Blue chip stock companies that are there since the time we know it such as General Motors, IBM and McDonalds are the helm of stock market. Hot penny stock companies can be considered at the ground level. They may not look promising or lucrative at present. But they do have the potential to turn into big names in future.