Are Penny Stocks a Waste of Time?
Are Penny Stocks a Waste of Time? Penny stocks sound attractive from the moment you hear that name. You can own stock in a legitimate company for a penny or less. This could be your chance to find the next Amazon or Google for just a penny. But are penny stocks a waste of time? The intrigue of instant wealth pulls retail investors into the stock market each and every day in search of the next big thing. What Makes Stock a Penny Stock? A penny stock is simply a micro-cap sized company, or a not-yet profitable growing company selling their stock for any price under 5 dollars per share. Some companies dispense their shares for fractions of a penny per share, that's right, you can actually purchase multiple shares per penny in some cases. The 5 dollar max per share is a rule of thumb but not an exact figure. It is based on the fact that many money managers' entry point for institutional, or large scale investments is around 5 dollars per share because of stability in prices ...