Tips on Making a Living with Penny Stock Trading
Are you looking for ways to earn some money that could support your needs and necessities? If yes, we are encouraging you to try Penny Stock trading. You should not fret because, many individuals have already tried their luck with this kind of trading and they succeed at it. The best thing about Penny Stock trading is that you are only required to provide a small amount of capital. As we aim for your success, here are some Penny Stock Tips that could help you out as a starting up a trade.
Tip #1 Complete Avoidance of Penny Stocks on Pink Sheets. In penny stock trading, companies trading within the OTC or Over the Counter market are bound to follow, much less regulation compared to those stocks that are being listed on the NASDAQ and The NYSE. Due to their difference, stocks on OTC are known to be highly prone to fraud and manipulations. So as a starting trader, you should only trade in on stocks that are listed on NYSE and NASDAQ. Although these companies have stricter regulations, it only implies that the stocks are cannot be easily tempered.
Tip #2 Remember to trade in Penny Stocks with the Right Volume. As a trader, you should avoid all illiquid penny stocks. Although penny stocks trading only requires a few thousand shares a day it is often being traded at a 40-50 relative volume that could reach 5 to 10M shares. You have to remember that this is the best day to trade in a penny stock. But you should not worry because as a trader there is always something for you to look at.
Tip #3 You should not easily fall for Promotional Boost. As the Penny Stock trading industry continues to grow, many OTC stocks are also being promoted on one point to another. They are being promoted as the next big thing, but there is no such thing as the “next big thing in trading�. But it is possible that the next big thing comes from a line of a digital gadget. You should not hope on this because if you those, you might end up as an investor in one of the mot speculative financial instruments available in the market.
Tip #4 Practice the Hit and Approach Method. As a trader, you should know when to stop to prevent overtrading. You can easily tell if a stock is on its momentum once it hit our standards on becoming a worthy trade. Once you are ready you should sell ½ of your position and adjust your stop loss to breakeven.
More info: http://www.affordablestock.com/best-penny-stocks.php