penny stock investment strategy

Are penny stocks worth investing in? Is there a good strategy to doing so? Do you have personal experience?

I’m a novice in regards to investing. So I assume “penny stocks” refer to very low cost stocks. However, I wonder, what is the strategy and purpose for investing in them? Besides hitting the stock-market jackpot by investing heavily in a penny stock that goes huge in terms of value, what are the more reasonable strategies to using them and putting your money into them?

I’ve really wondered this, too.

I think the attraction is just that a small change in the price is a big change, percent-wise. For instance, if a stock goes from $20 to $20.01 that’s only a what, 0.05 percent gain. But if a stock goes from $0.10 to $0.11, that’s a 10 percent gain. In theory, if you had invested $1000 in the first stock, now it’d be worth $1005. But if you had invested $1000 in the second stock, now it’d be worth $1100.

Of course, it could go down by that amount just as easily as it could go up.

As far as strategy…I’ve usually been too scared to try, but I suppose if you spread your money across a bunch of them, and watched them like a hawk, you could cash out on the peaks and buy in the valleys just like any other stock, but on perhaps a shorter timescale.

Picking hot penny stocks made easy

THE GUIDE FOR PENNY STOCK INVESTING $13.40 The Guide for Penny Stock Investing is a book dedicated to the experienced and novice investor who wants to invest in penny stocks. The book offers the investment and trading strategies used by the author and other experienced penny stock traders. The book uncovers the rules that investors and traders need to learn before they can hope to capitalize on the opportunities offered by penny stocks. An…

2012 Penny Stock Report 11 penny stocks that could make investors big gains in 2012. Each stock has a short description and a chart image….

Mastering Microcaps: Strategies, Trends, and Stock Selection (Bloomberg Professional Library) $10.00 A concise, expert approach to microcap investment strategies and stock selection for professionals. Coverage includes risk and return profile, history of the market, current trends, long-term outlook, a profile of winning and losing microcaps, research strategies and sources of additional information….