Penny Stock Brokers 4u

Wouldn’t it be nice to open up an article and see a nice listing of all the best penny stocks to invest in right at your fingertips? While you can find various sources online that will give you up-to-date stock picks, both in traditional stocks and in penny stocks, there isn’t one article that can quote you the best ones to buy that would be effective today, tomorrow and next week.  The main reason for this is the nature of stocks in general – they fluctuate so much that today’s golden ticket can be tomorrow’s goose egg. So much affects stock price that it is impossible to know with any certainty what makes the ideal stock investment even without considering the extra volatility that penny stocks are known for.

So, how does one go about choosing the best penny stocks to invest in when deciding to put some of these into an investment portfolio? Well, first understand that there is no quick way to do this. Just as one must take time and due diligence when selecting a piece of real estate, a business venture, or even something as uncomplicated as a bank certificate of deposit, so too must an investor be willing to do their homework carefully when choosing stock – especially penny stock.

One of the things that make penny stocks in general so risky is that it is very difficult to get historical information on many of the offerings. New companies use the sale of low priced shares to get off the ground so often there is no indication of the potential financial prosperity ascertainable from historical figures.  Not to say we can be assured that a company with a strong history will continue to be profitable, but without any history we have no idea whatsoever what the company is capable of. One way to try to steer clear of the more dangerous penny stocks is to look more at the ones that are listed on the major exchanges. Although most are not, the ones that have produced the financial information and other requirements to be allowed to list on the major exchanges will be easier to research.  You can also look to companies that have already done the research for you and list their information online. One such company is Penny Sleuth whose website can be found online and their  section on top 10 stocks is rather informative.

Another way to become educated in penny stocks is to look at what other investors are doing and what they are talking about. There are a number of online communities and forums where like-minded individuals gather to rant about the poor performers and brag about their winning choices. Although the information like this is not conducive to picking those to buy at the current time, you may be able to find out how they chose them in the first place and thus learn a thing or two. All blogs are not like this and actually will discuss ones that are ripe for buying, just be sure to consider whether it is a legitimate investor trying to help others or someone just trying to drive up interest and thus the price of their own holdings. One place you can go online to research stocks is ValueWiki. The stocks are placed on the lists by a voting system of its members so you are finding out what the majority of people find interesting.

Besides the general investor, there is much information to be obtained from professionals. If you already have a portfolio with a broker, talk to him about his recommendations. While not all full-service brokerages will handle penny stock transactions and some do but with extra fees that do not make them advantageous, you may still get some useful information. They may even be able to recommend a newsletter or website that they have found useful or that other clients have successfully used when choosing penny stocks.  Additionally, there are various websites that provide research information on all stocks – ones such as MSN Money that let you search for stocks based on various criteria – that will be helpful once you have decided on the specific standards that you want for your investments.

Regular updated newsletters and websites are offered by literally hundreds of stock forecasters that can give you information about offerings that they believe will be profitable. While some of these involve a membership fee or ongoing subscription fee, there are many that do not. One of the more commonly used companies is The Stock Wizards. Their site includes useful information such as industry news and articles in addition to their regularly weekly top ten choices.

Learning about the penny stocks available and determining how you are going to go about choosing ones for your portfolio is a time consuming process if done responsibly. Much like some forms of gambling, your chances are improved by knowing how the game works. Learn all you can about this type of investment through educational means such as books and websites so that you have a full understanding of the risks involved.

As a penny stock investor, you have choices to make:

• • Choose your advisors carefully and consider what their agenda may be when giving you advice.
  • Choose your brokerage carefully as well. It may or may not be the same one you use for your other stock holdings. Understand their commission and fee structure, especially how it pertains to low priced stocks and large volume transactions.
  • Choose your stocks wisely. Perform due diligence! Do not diversify so much that you cannot keep up with the time involved in watching them regularly. Do not invest more than you can afford to lose.
  • Choose your goals – set a profit goal for each one and get out when you planned. Do not fall victim to greed and thus hold past the point of the best profit.

Lastly, if after all your research and planning you feel uncertain whether investing penny stocks is for you, know that they are not for everyone and sometimes the best choice is to choose something else.