What Are Penny Stocks?
A penny stock is basically any stock that trades under $5.00 per share. For many brokers, this is a threshold limit where they will not spend money on research, and will not loan against the value of the stock. Therefore, there is great potential as these large firms are not paying attention to these stocks. Because of that fact, it can be harder to get information on them.
That is where these online and printed newsletters and research firms come in. Most are independent and concentrate on these stocks that the big-boys are ignoring. It's not that these companies are not great companies; it's mainly that the larger brokerage firms depend on large transactions, planning and merger activities to make money. These smaller companies only have limited value to huge firms such as Merrill Lynch or Goldman Sachs. They basically get ignored.
StockGoodies.com is committed to covering the micro cap market space primarily focusing on Pink Sheets and OTC Bulletin Board and other sub-$5 stocks.
How do you know when a penny stock is undervalued or overvalued? If you are new to penny stock trading this is very important. The difference in your timing of getting into a penny stock can be either huge gains or huge losses StockGoodies.com prefers the huge gains.
While these smaller stocks are riskier than their larger brothers, they have a tremendous reward potential if you can find the good companies. While some small companies have gone from 50 cents to zero, some have also gone from 50 cents to $25.00.
More recently, investors are quickly learning that these penny stocks are the future companies of America and the world and have great potential. Microsoft itself was once a penny stock.
What we are going to do today is look at a few examples so you understand when you should be getting in a stock or getting out of a stock. We are talking about penny stocks not big board stocks in these examples just to make that clear.
Let’s use some examples of penny stocks that made huge gains in 2009/2010. This This was a time of bio tech, medical equipment and pharmaceuticals in the penny stock arena. So the stocks we will use are from these sectors and a couple others.
The first stock that we will talk about is the one that could’ve made us all rich and well-off, if we just had 20-20 hindsight.
VRMLQ: (Sinced has dropped the Q) This is a stock that was a life changer for a few traders in the penny stock world. The stock went from .05 to as high as $34, that’s right $34.00!!!!!!!!! Thats
33,900%
Dendreon DNDN, another Bio stock was trading at 2.55 in 2009 and hit a high of 57.67 in 2010 for a Sick 21,615% Gain for Investors that had the foresight to Invest.
Moves like this Could Make Us Rich, so Our Goal is to Try and Find the Next VRML & DNDN
Cost Plus Inc. CPWM
2009-2010 .51 - 12.87 - 2,423.5%
Samson Oil & Gas SSN
2009 - 2010 .183 - 4.75 - 2,495.6%
Well You Get the Idea of the Value of Finding Such Gems as these and this is the Main Goal & Focus of stockgoodies.com
Bringing the Rush to Our Members and New Subscribers
It will be true that Trading penny stocks is much more confusing when compared with investing in traditional stocks.
Posted by: Penny Stock Alerts | 01/12/2012 at 05:32 AM