A Penny Stock is a class of company whose stock price trades at a very low price. Traders and/or investors go long on these stocks with the speculation that it will rise in value and in turn offer great rewards for those who are long in it.
But it is worthy of mentioning also that these stocks are extremely volatile and therefore risky. Traders and/or Investors must be very careful to avoid huge losses as well. Below are some tips for you to consider on how and where to find penny stocks to buy, and consequently have that huge gain you are looking for.
What Are Penny Stocks?
I will do my best to explain, what are penny stocks and quick as possible but without compromising the conciseness and the essence of its content. So, here goes – One of the website that I use in finding penny stocks is the OtcMarkets. Here I can find all the pink sheets stocks, the QB stocks, OTC and so on stocks.
In order for me to find penny stock to buy, at the OTC markets, in the second to the right most side of the header is an icon that reads “RESEARCH”. There will be a drop down menu when you click on that, and a choice that reads “Stock Screener”.
After you click on those, you should be directed to the page where you can specify what type of stocks you will be looking at. You will be seeing three (3) boxes that you can choose to filter the stocks that will be shown to you. These filters should be in a box with headers that reads TIER, SECURITY TYPE, and LOCALE.
As an example, I’ll be looking at US penny stocks; at the TIER filter, deselect all boxes by selecting “None” on the far side of the word TIER, and just scroll down and tick the box “OTCQX U.S” and “OTC Pink Current”. By doing this you are assured that the stocks that you are picking are current stocks and thus are good stocks.
Moving forward, shift your attention to the “LOCALE” filter and just tick on USA, and click the GO button just above the LOCALE filter box. You should be seeing below all the stocks under the filter that you chose.
Where to Find Penny Stocks?
Now the next thing to mind is to know how to find penny stocks to buy within all the stocks that are listed under the restrictions of your filter. Personally I go for penny stocks that are priced really low but has a high volume. Normally above a million. This is seen under the column “VOL”.
This tells me that the upside of my investment is high (Low Price) and the liquidity is not a problem (High Volume). We need to be investing on stocks that has good liquidity to ensure us that we can withdraw our profits when we want to. Whilst, low price means that the stock is at the price of below 0.0015.
Sometimes you see it in the first page of the stock list, but most of the time you need to sift through the pages and find those that fits the criteria. Kind of like looking for gems among the stones. Below is a stock that I would probably consider for it fits my criteria – Price below 0.0009 with a volume above 1,000,000.
How to Find Penny Stocks to Buy?
Moreover, how to further verify that the said penny stock is a good buy is to click on the name of the stock and check the company profile.
What I usually do is to make sure that “FLOAT” is less than 500,000,000 and “AUTHORIZE SHARES” is at 1,000,000 to 1,500,000 or within that area. This gives me an idea that my upside is greater than my risk.
I hope this article gave you guys some idea on where to find penny stocks and what penny stocks to buy. Overall, always keep in mind that in investing we would like to minimize as much risk as possible and increase the upside to as many folds as possible. In this way, we ensure a sustainable and profitable way of investing. Good luck guys!