subject: How To Be Successful When You Buy Penny Stocks [print this page] As the penny stock is valued at under five dollars, many people reject the idea of buying them as an investment. The stock generally comes from companies that are new or those that are small and are not listed on the major stock exchanges. Instead, they are listed in the over the counter bulletin board exchange or the OTCBB. Regardless, they can be a great way to earn some money, as long as you make wise decisions. If you are interested in earning some extra cash, the following steps on how to buy penny stocks will get you off to a great start:
The first thing you should learn about is that when you buy penny stocks is that you still must find a stock broker. You can do this online and you will find what these companies do is require you to set up an account with one that handles buying and trading of the penny stock. A fee will be required for each trade you make and you will want to examine all of the fees before you do sign up.
Once you have started your account, you are going to want to become very familiar with the website. Each one will have a variety of tools that you can use and you should make sure you watch all instructional videos and tutorials that are available. It may seem time consuming, but it will help you a lot.
After becoming familiar with the workings of the website, you can start searching through the various stock that is available to purchase. To make the best decisions on buying, you have to do the research. This is going to be a lot of time, but it will be the only way to increase your chances of actually earning money off the penny stock.
Knowing what to look for in a prospective investment is half the battle. What you want to do is look for companies that have something big going on, such as a new owner or product. A company that is in the news headlines will get more attention and may be a cause for the stock prices to rise.
When you have the first stock to invest in, follow the website directions to purchase. Once the purchase is complete, you will want to watch the price of the shares and sell when you can make a profit. Knowing how long to hang on to the stock is the hardest part of learning how to buy penny stocks, but with more time and experience, you will make better decisions.
