There are secrets all over the penny stock market. The gurus may act like they’re sharing how they have got to where they are with you, but many strategies are being kept away from your reach which could have been able to help you with your day-trading.
Would you like to learn more about those secrets about the penny stock market? If you do, then keep reading this post to find out some of those secrets.
But before I share them with you there are some questions I have to ask you. Are you a current penny stock trader? Or are you planning to start trading penny stocks soon or in the near future?
If you have already started trading penny stocks, it’s not a problem, I hope you have not lost too much. And I also hope that you’re have learned from your mistakes and trying not to commit them again.
But if you’re reading this post to learn prior to start trading, you’re doing very well in your self-education on this market. The time spent learning before you start trading will be awarded when you start, it won’t be a time lost.
Without further ado, let’s rapidly get to this list…
#1) All guru lost tons of money: The gurus in penny stock trading are those who have been trading for awhile, those who know a lots about the stock market than we do. We usually think that they don’t lose much money, especially since they don’t usually share such information with us.
In reality, they have lost so much before they reach to where they are. They did not start by being successful with their trades right off the bat. No one can say that starting penny stocks trading was successful to him or her, because beginners have a tendency to lose.
#2) Trade penny stocks that are in action: You may get tempted to trade stocks that are trading at a very low cost, but trading those that are not in action can be dangerous.
Just because a penny stock doesn’t cost too much does not mean it’s a buy. The price is just one factor, you have to look for the other factors before you buy. Look through its trading history to see how it has been doing.
Why is its price so low? How long has it been this low? What this company is doing at this period of time? These are all the questions you should ask yourself and try to find their answers before you make your decision.
#3) Cut your losses early: When you’re losing you should cut the loss as soon as possible. I know it’s tempting to try to win your money back. We are humans it’s not always easy for us to make up our minds, but cutting your loss early can make a very big difference.
Last night I went out with my wife and some friends, we decided to go to the a casino. I played Blackjack for a few minutes, I was constantly losing. I had to stop because I did not want to lose anymore than what I have lost.
This is the same mentality you need to have when you are losing in your trades. Your chance to lose is always greater than your chance to win. If you cut your loss early there’s a great probability that you still save even though you’ve actually lost.
#4) Take big risk sometimes: In order to win big you have to take big risk. When I say big risk I don’t mean $20,000 or $30,000. Although you can start trading penny stock with $500 or even less, wining with such a low amount of money will be small unless it’s a huge percentage.
That does not mean you should get credit in order to trade as well. Always trade with money you’re not going to use any time soon, because you’re not sure if you’re going to win or lose.
#5) Always use a stock screener:Stock creeners are there to help us find the right stock. Although they are just one little factor in our research, their service is very advantageous.
This tool will allow you to search for hundreds of stock in a very short period of time. It’s used to filter out the stocks you would want to trade from those that don’t make it to your list.
#6) Use discount brokers: To trade penny stocks there’s no need for a full-time broker. Full-time brokers are costly and you don’t really need their services in order to trade penny stocks. Go with a discounted broker, which should be enough to provide what you need.
You basically need the broker for your trades. Many other tools that you will be using from this platform could also be found from other free sites. Instead of spending your money on expensive brokers, don’t you think it would better serve you saving it or trade with it?
#7) No need for a large amount: You don’t need much money to start trading penny stocks. Some brokers may have a requirement as of how much money you need to open an account, but the majority of them don’t have such a requirement.
This is one of the investing methods that enables us to invest with a low capital, but the lower is your capital the lower is your profit ability.
I think it’s just common sense, if you don’t invest much you won’t be able to profit much. This is why it’s better sometimes if you can trade with a little more money.
You will always hear wonderful stories about penny stock trading. But before those traders get to this position they have been through a lot.
Most of them have lost a lot of money before they actually have a hang of it. With that been said, you have to be careful as of when you choose to start trading penny stocks.
Do your work, learn the basics of penny stock trading. Don’t just jump in and start by hope, which can lose your money.
As always, trade smart!
Don’t forget to share this post with your friend if it was helpful to you.