Making Money Trading Penny Stocks: Is That A Myth?

Are There Reasons To Believe Penny Stocks are Profitable?

Those of you who have never tried the penny stocks market before may find it strange, or even unbelievable, but trading penny stocks is indeed beneficial. Using the best approach is the key to success in OTC. I have heard of people making tons of money by trading penny stocks, but it does not happen to them just by pure luck although their luck plays a huge part of it as well.

Are penny stocks profitable? Off course they are, but a lot of work is required in order to see the profits. The hardest part is find the right stock to play with. I say play with because often time you may have to stick with one stock by constantly buying and selling your shares. The way this is done is you buy when the price is low and then sell it after it has been increased.

This is where many people loss their money. trading penny stocks is done on a daily basis, that’s why it’s also refer to as day trading. You can’t expect to hold on to a stock for up to two days, not even one. If you are to be successful in this venture you will need to have enough time during your trading day to sit in front of your computer and follow the activities of the market. When the time comes to execute you would be right there starring at you computer’s screen. Your broker should also have some ways that you can program your portfolio as of when to execute a sell or buy. But being in front of your PC is the best.

Control over emotion…

Our emotion could be our worst enemy in trading penny stocks. For the larger companies, such as Apple, you can buy some shares and hold them. You can hold them for as long as you want. But  in penny stocks trading that would be a huge risk. With that been said, to make money in this market you will have to know when to buy and when to sell.

Once you are able to control your emotion it should be easier for you to invest in this market. I have read stories of people making thousands of dollars just by trading penny stocks. This itself should answer whether or not making money trading penny stocks is a myth. The safety of your investment will always be at high risk, though. There is not anything you can do to ensure that your money is safe.

When I first started trading penny stocks my judgement used to cost me. I used to think that the lower is the cost per share the more advantage I have to make more money. It does not always work like that, sometime the ones that cost a little more than the others tend to move up more frequently.

I was partially wrong because the cheapest penny stocks are more prone to manipulators. Pump & dump affect these cheap penny stocks the most. If you are going to invest in this market always try to put some time aside to do some research on the company. It could be a great boost to your chance of making some profits.