Penny stocks are publicly traded stocks of small companies that are traded under $5 per share. They are also like other traded stocks which are also regulated by SEC but rather get traded on main stock exchanges like NYSE; they are traded on OTC (Over the Counter) market which is also very much accessible for general public.
Undoubtedly, these penny stocks are cheap priced and relatively high risky stocks compared to blue chip category, but regarded as best long term investment stocks to get multiple return. Small companies are growing in terms of their business and can give multiple percentage growth. The stock price of young and prosperous companies, which has given favorable business growth over the past years can increase by huge percentages in short span of time. Penny stocks have created a lot of millionaires, but those people have attained the money either by scam or fraudulent methods.
These penny stocks are those hidden gems, which analyses and picked carefully can be a great opportunity to earn significant upside and create millionaires. Despite of knowing about Penny stocks, people prefer them for the following reasons:
- Minimal Investment Needed: These penny stocks just require minimal investment due to its low price. For the price of just one share of large company, an investor could buy thousands shares in penny stocks. So, there is an opportunity to earn huge with minimal investment. Know more about Penny Stock Investment.
- High return potential: Penny stocks are traded at very low prices and any favorable growth seen in the business can tend to make the stock price double or even triple in very short span of time.
- Interest of big investors: Interest of big investor is very important of any stock to outperform. The big investors always look for value in stock, once they locate a hidden gem they tend to take that stock to great levels.