[mage lang="" source="flickr"]how do penny stocks work[/mage]
If you know a lot about business/stocks…?
I know the basics. but…
How do stocks exactly work? How do they go up and down?
How much does it cost to buy a stock thats worth 36 dollars?
Do you know any “penny” companies that i should invest in?
Stocks go up in value when the market thinks that it is worth a higher price and there is a demand for the stock. If the demand for the stock is higher than the supply, the price of the stock will go up.
Buy a $36 stock is easy, just contact a broker and purchase the stocks via your brokerage account; if you don’t have one, you can open a brokerage/investing account. There are very many options for brokers nowadays.
Before you buy stocks you must have an exit strategy, a profit target and trailing exit/profit positions. You have to determine if you are investing for income(dividends etc) or for capital gains(selling stock when the prices go up). Plus are you investing for the long term or for short term?
Also, what you have to ask yourself is if the $36 stock is worth the price you are paying for it. Therefore, you must look at the financials(fundamentals) then, you could use technical indicators to determine when to buy or sell a stock that you interested in.
Penny stocks are generally left for the more seasoned, experienced or sophisticated investors. If you are a beginner penny stocks can be a dangerous gamble and you could lose all you capital and go broke.
What Is The Penny Stock Egghead Does it really work?