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5 Golden Rules for Investing in Penny Stocks

Welcome to 5 Golden Rules for Investing in Penny Stocks. In this two-part video series, we’ll teach you how to invest in this speculative corner of the market. If you adhere to these five golden rules, your winners will far outshine your losers, making hunting profits in penny stocks a worthwhile endeavor, indeed.

In Part 1, we’ll begin by explaining why Wall Street’s problem with penny stocks is almost entirely logistical. Most investors avoid penny stocks at all costs. You know what? That’s okay with us, because there’s a fortune up for grabs if you know where to look! We don’t want you to get burned, so we’ll show you how to go about it the right way. Are you still skeptical about investing in penny stocks? Well, you should consider Pfizer. After CEO William C. Steere, Jr.’s company announced its deal to market Lipitor, it grew almost 1,000% in six years. At the end of Part 1, we reveal rule No. 1 – “Focus on Fundamentals” and rule No. 2 – “Limit Your Investments to $1,000 or Less.”

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How do you make your winners outshine losers? In Part 2 of this video tutorial, we show you how with the remaining three rules. Remember, “buy and hope” is not an investment strategy. We’re after fast gains. If these companies don’t pay off quickly, sell and move on to a better opportunity. Use limit orders, not market orders, to buy penny stocks. Using market orders will cut into your profit potential. Remember, penny stocks are notoriously volatile, so be patient. Finally, use the following indicators to buy the best in the bunch: solid earnings growth, extensive insider buying, unusually high trading volume, and stocks making new 52-week highs. These indicators will lead you to winners more often than not.

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Now that you’ve got a basic understanding of how to invest in penny stocks, you’re ready to join us on the path to profits. Fear not, if you’re still a bit hesitant about heading out into the markets alone, more help is on the way with every issue of Wall Street Daily. Subscribe today to receive our FREE e-letter and access your report, 5 Golden Rules for Investing in Penny Stocks.