12:48 AM - Penny stock alerts - 5 Tips to Find Hot Penny Stocks
1)
Trading
History
:
Examine a company's trading history and pay attention to spikes and
dips to determine if there is a trading pattern. For example, if a
share routinely shows prices spikes just before the quarterly
statement is released, then you can plan your purchasing and
selling plans accordingly.
2)
Trading
Volume
:
Look for companies with a history of high volumes of shares being
traded at a stable consistency. It is important to look for a
company with consistently high volumes, because average volume can
include extreme spikes and lows - giving an overall misleading
impression.
3)
Industry
Trends
:
When doing your research on
penny stock picks get
an idea of the industry the company is operating within. What is
industry's growth potential? How big is their customer base? What
separates them from the competition? Remember, these are just
guidelines, and picking a stock that excels in all areas of
research does not always lead to gains. Conversely, stocks that
look bad on paper can experience huge increases.
Penny stock
alerts do some of the work for you, by narrowing the focus of
the search, but it is always up to the investor to make the best
decision for his or her personal portfolio, budget, and comfort
level.
4)
Profit
Margin
:
Probably the most obvious tip, one so obvious that it can't be
skipped, is to look at the company's profit margin. It's not an
immediate red flag for a new company to be losing money - to a
point. As an investor, you should know how much debt does the
company has, as well as an understanding about why they are losing
money. Signing up for
free penny
stock newsletter will give you a great list of interesting
companies to start researching.
5)
Exit
Strategy
:
Go into your investments with a strategy. Know whether you want to
participate in day trading, meaning you are making short term
investment and spending a lot of time watching the stock market. Or
do you prefer long term investments, in which case you should do as
much background research as possible before investing in a company.
Always know your limits and when you will cut your losses and sell
a stock.
Don't
let the opportunity to make money pass you by. There is the
possibility for huge rewards for those who invest time in
learning about penny stocks and monitoring their investments.
Take advantage of free penny stock alerts to get an idea of good
companies to watch.