How to Buy Penny Stocks With Scottrade

Penny stocks tend to come from small companies.

Scottrade is a brokerage firm that has a full line of investment products (stocks, individual retirement accounts) as well as online trading platforms. Scottrade offers customers market research, trading software and low commissions.

Function

Scottrade allows investors to trade penny stocks. Investors can register for an online trading brokerage by filling out a form that includes personal information (name, address). Once established, you can create trade orders by including the penny stock of choice. If a trade order is executed, the trade will process immediately. Investors can also trade via phone by calling Scottrade (see Resources).

Identification

Penny stocks are shares from small companies with a small market capitalization (market value). Penny stocks are regarded as those that trade under $5 per share. Penny stocks are highly speculative and can be a very risky investment.

Considerations

Penny stocks are risky. Small companies can lack transparency and recorded data, which make it nearly impossible to analyze properly. Furthermore, these stocks have limited listing requirements and regulatory standards. Do as much research as possible before investing.

References

• Scottrade: About Us
• Investopedia: Penny Stock

Resources

• Scottrade: Products and Services