Generally speaking, I don't think the sticker price is of any consequence once you're higher than single digits. I'm more cautious with single digit stocks, and VERY cautious with any that are even less than that. But all else more or less equal, a $15 stock with $2 EPS is generally a better buy than a $50 stock with $2 EPS.
Yeah, Murphy USA is the first that comes to mind. (MUSA) My lower limit is $20. If it's lower than $50 though, I keep an eye on it. If I don't feel comfortable with it, it's gone in a year. One question, how? I'm more of a slow grower type of investor. Invest in something good and wait for it to grow.
That's basically what it was... waiting. The "how" is that is was a start-up Internet business from a few years ago and it took off to great heights. It could have just as well tanked, so it was fortunate it turned out that way.
It is possible to make money with penny stocks be the trouble may not be worth it. Like the poster of this thread said, it is a huge risk. These are small companies that may not make profit and they do not have much information on them. I think sticking to a more stable stock is a good idea but spending a little money on penny stocks are okay.
Everyone is saying there is a big risk within penny stocks. And i believe it! But i am new to the whole stock game, so is penny stocks still the way to go?
I'd stay away from them, personally. I'd look into something that carries less risk. People getting started in trading think penny stocks can be a cash grab, but the risk is real and likely to catch up with you, at least in the true penny stock arena.
I remember when my cousin was going on all about how you could invest in a penny stock and get super rich. He talked about how a stock could be 010 cents and by going up to a $1 it will multiply your investment by 10. How many tiny companies blow up that big? Not many. The chances you find one that blows up is slim to none. I decided to not even attempt to invest in penny stocks. They are too unpredictable.
My preference is to stay away from the penny stocks, wait until I accrue more money to invest and then find stocks that are less volatile.
Most penny stocks fall into the category of being unknown companies and if you are going to attempt to do so, please do only small amounts. Also you should learn of all the drawbacks before hand and see more information about it also.
The only exposure to penny stocks that I have is the way penny stocks and the practice of trading them is how it was portrayed in Wolf of Wall Street. Is there any regulatory body that monitors penny stocks? If not, what is the best way to protect yourself from fraudulent investment opportunities? Does anyone have words of wisdom?
