Saturday, December 10, 2011

An Article About the Best Penny Stocks To Buy This Year

By Peter Stewart


Where to find the top penny stocks and shares to invest in is the difficulty everyone must face up to.

Be you a novice or a seasoned trader, the 1st kick off point will be Google. Look up Google.co.uk/finance, and here all, or virtually everything will be there and in a reasonably straightforward format.

Examine especially all the different sectors, and their conclusions. This lets you see which sectors are performing well, and which aren't.

Look at any single area, such as Pharmaceuticals, and check on how well it has performed compared to the Footsie.

You will peruse all of the corporations in that category listed by their quotes, and all are listed in nickels, so you can get down to shares that may literally sell for 1p.

Check out statistics, and go to the website of the company.

Note that this gives you a start before you continue your research.

Never purchase whatever you do before you do your homework.

There are hazards to stay away from as the next part of the article will show

What are the the best penny stocks is a question people thinking of investing regularly want to know?

The reality is there's no one correct answer, but perhaps to try to show you principles behind what definitely aren't the Best Penny Shares to buy.

There are 2 particular areas amateurs must avoid or be exceedingly watchful and conscious of.

Firstly the Pump and Dump Penny Shares

You need to understand that not everyone who buys and sells penny stocks is truthful. Actually some of the penny stocks trading is downright fraudulent. The price of stocks get verbally enhanced,or hyped. The persons involved buy lots of stocks at rock-bottom value, giving an illusion of activity. Stock prices rise dramatically and quite suddenly. You will see the rise, catch the feeling that you're missing the boat, and buy the stock too late after the price has risen unsustainably. Indeed you may probably be buying stock from a person that began the trick, because that's probably what it is. They bought at the bottom and are now making their profit, unhappily from you.

The next thing to watch out for are price spikes in penny stocks in the aftermath of Good Reports.

You might think a good report about a penny share company makes them the best penny shares to buy. But wretchedly this might not always be accurate.

Again you may well read about a rare metal discovery and by that time the penny shares will have risen like a spike. They will fall again when the discovery isn't all that it seems, and then rise again after the following report. You have to know the source of these reports, are they independent, or internal to the company. Some research will uncover this, and you should also be able to find out the frequency of the reports, and maybe anticpate their observations so you purchase at the bottom. Or if you are holding these shares sell them after the report becomes public.




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