[mage lang="" source="flickr"]what are the best penny stocks[/mage] hey guys, what is the best penny stocks in the us market these dayes?
or what is the cheapest stocks i can buy now
thanks all and have agood day
Penny stocks are extremely risky. There is a reason why they are penny stocks. Just because you see a low price on a stock doesn’t mean that it is not expensive. The price you see when you look at a particular stock is really not the price of the stock. You must look at the P/E ratio. P/E stands for price to earnings ratio. Price divided by Earnings. If you go to Yahoo Finance and type in a particular stock symbol you will get most of the information need to start analyzing a stock.
So you take the current Price and divide by Earnings this will give the P/E. Lets say that when you do this that number comes out to be 17. So that means the stock is trading 17 times last years earnings. That is the price you are really paying. Now you need to do farther analysis which is to compare this number (p/e) to other companies in the same industry and sector. If you know anything about sports you know that you use certain metrics to compare the players to other players. You are doing the same thing with companies. Now P/E analysis is only part of analysis to determine wither a stock is expensive or cheap. So a stock with a price tag of $100 maybe cheaper than a stock that has a price tag of $65 dollars because again its the p/e ratio that is the price. Remember you must compare apples to apples. You cannot compare for example Wal-Mart to Apple Inc. They are two different companies in two different industries/sectors. Please go to investopedi.com to take free tutorials on stock analysis. Also study Sector Rotation and the Federal Reserve and Interest Rates.
Sector Rotation is very important…..every stock has its season.
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