What Are Penny Stocks? Penny Stocks To Invest In! (#57)

 

What Are Penny Stocks?

Penny StocksCompaniesing but the Stocks that are cheaper in comparison to others.... In India, generally stocks which are less than 100 rs. are considered as Penny Stocks. & in The U.S. .... the Stocks less than around 7$ are considered as Penny Stocks!

In simple words, as the name itself might suggest.... Penny means Coins.... So we know that coins aren't really used for large amounts to be paid.... I mean we can use them but we just don't.... Infact, we'll rather use cash to make large payments for the fast & smooth functioning of the system!

So, Penny Stocks are basically "Cheap" Stocks! Like the one's that just aren't very pricey & sometimes even low than the average Stock Prices!
[I'll talk 'bout Investing in Penny Stocks within a while!]

By Penny Stocks.... I more specifically mean that Penny Stocks are those Stocks.... that prices generally range from such to such in what we may just pay as in Coins.

You know.... that may seem kinda funny!
But that's just how actually I think of them!
& believe it or not.... it is an easier way to understand Penny Stocks!

Let's now talk 'bout Investing in Penny Stocks....
So, even though penny stocks are very cheap
.... we shouldn't invest blindly

Well, as soon as I said that Penny Stocks are cheap, y'all may have really thought of Investing in them & buying quite alot of them.... if not alot, a little.... maybe!
Most people mistake this in investing that all Penny Stocks are good....
Well this just isn't always the case!
Infact, earlier their used to be these stocks which were way cheaper than they are today!
Actually, today, every single Good Company have got a higher Share Price. So many find Investing in them hard as of they are costly for many people.
& another reason people want to Invest in Big Companies is because they are trustworthy & the Risk is minimised, here!

& some Small Companies which are risky in general have a lower Share Price, which may be suitable for many.
But we as humans have got some trust issues with them & they are risky as I said!
---- You know; Investing in Share Market is risky!

Now; I'm not saying that all the Small Companies are bad to invest in....
'Cuz as we know the Large Companies today used to be Small, years before.

Actually, what I basically want y'all to understand is that instead of just Big & Small.... you should also check the fundamentals of EVERY COMPANY before investing in them & act as per the fundamentals, keeping the Market's current behaviour in mind!

Think of it like this---- You know you are gonna give your money to someone.... so, give it to such a person who is capable of returning it on time with interest!

What one should basically be aware of is why is the Share Price of a Company such if its high than why is that so & if its low than why so!
Also look at the Companies sales past performances & basically everything which is related to the Share Price, somehow....



I know many just don't mind putting effort over researching alot 'cuz loosing a penny may not be a very big deal for them.
But if you do it like that---- It is more of something like "GAMBLING", for you!

Yet, still, many people really invest in large chunks....THEY INVEST ALOT OF MONEY IN THE SAME COMPANY!
Like-- if a share is of 4$ of a Company.... than many people may buy 100 shares for 400$.

& so now .... as far as I know IT IS DEFINITELY A BIG DEAL.... LOOSING 400$ THAN IT OBVIOUSLY WAS FOR 4$.

All I want y'all to know 'bout Investing in Penny Stocks is that.... you should know what you are doing.... know why is the Share Price such.... put in some Time & Effort....
Over all, I wanna say that not all Penny Stocks are worth investing in but many have usually paid good amount of returns.

As I said.... just keep in mind.... that:
Big Companies were One's Small

So, Focus on A COMPANY's FUNDAMENTALS....
Know how much is A Company Capable Of!
RESEARCH WELL & THAN TAKE ANY DECISION!
Lastly, remember that.... Large Companies don't have alot of growth potential in Comparison to the Small Companies!


NOTE--> I am not recommending any specific Stocks, to anyone in this article.
This article is Completely based on my research.... their are no recommendations given!
So, all of your actions would be your complete responsibility....
My duty was to provide you with the basic information!
Thanks!
Regards....

Anyways, so all the best for your Investing Journey.
Thanks For Reading!