What Is Penny Stock?
If you ask an investor what a stock trading under $5 is, they will tell you it is a penny stock, microcap stock, or nano stock. These three terms are for the most part interchangeable. However the broader definition of a penny stock refers to a business’s aggregate value of its outstanding common shares, are more commonly known as its market capitalization rather than its stock price. But a penny stock can’t be defined completely by any set term.
There are many different definitions about penny stocks. According to the Security and Exchange Commission (SEC), stocks that are sold for less than five dollars, are called a penny stock. However, there are also some that say it is a stock that is sold against the penny. Whatever definition it may be, a trade that is performed on the Pink Sheets or Over the Counter Bulletin Board (OTCBB) where stock companies are enlisted, is called the penny stock market.
Now that we know what penny stocks are, how can we quickly work out what to trade and when, to maximise our profits? Remember, normally only after we have made a number of trades using small low risk sums can we even think about making the kind of trades we need to make the big money quickly. Generally, traders have to put in hours, weeks, mouths and even years to become experienced in the market. Only after trading many times and analyzing the trends and results over a long period can a trader say he really understands trading stocks, and even then he will still lose on many trades.
If you want to know more about stocks, please visit www.asiacharts.com. It is a website that provides detailed information of some tools related to stocks, such as Parabolic Trend, Turtle Trading System, Metastock Addon, Stock Trading Seminar, Metastock software and so on.
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