How to Trade Penny Stocks Online
You've been eying stock quotes at the bottom of TV screens for years and have been perusing the Wall Street Journal on a regular basis. Now you realize that your hobby of researching and playing the stock market might pay off for you if you begin to trade penny stocks to make money online.
- Difficulty:
- Moderately Challenging
Instructions
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1
Set up an account with an online brokerage such as Ameritrade, E*TRADE or Scottrade. Familiarize yourself with their terms and conditions, including transaction fees. Sign up for newsletters with penny stock news through your brokerage.
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2
Tie your online brokerage account with a bank account. You might want to open a separate account at your local bank for stock transactions. This process might take several days since your online brokerage needs to confirm your personal banking details.
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3
Research penny stocks while you are waiting for the bank information to clear. Some starting point are newsletters like Global Penny Stocks and The MicroCap Journal or the Penny Stock Blog. Ask friends who are investors what their opinions are, read newsletters on penny stocks, or go to online forums and read what others are saying about specific penny stocks.
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4
Verify that the advice given to you is correct by researching several sources. Look at charts of potential purchases online to see if you notice any trends. Purchase your stocks once your bank information is approved.
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5
Buy stocks when they are under $5 and watch them closely as the prices rise. Get ready to sell quickly after a significant gain, especially if the price is starting to take a down-turn.
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Tips & Warnings
Playing with penny stocks is risky. A majority of companies with stocks that trade for under $5 go bankrupt within a decade.
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Comments
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stockbanana
Dec 09, 2010
Very intellegent. Penny stocks are mainly for skilled traders that know the in's and out's of professional Market making tricks and tactics. Trades occour over a very short period.
