If you’ve got a list of penny stocks, that’s great. But how are you supposed to tell which penny stocks are the best?
Finding the best penny stocks really isn’t that much different than finding the best stocks in the Dow Jones. It requires the same kind of research if you were investing in a penny stock as if you were investing into Google.
Make sure the stock has strong fundamentals. That’s the backbone of any business. Take a look at their financial statements. See if profits are strong on the income statement. See if assets have increased every quarter on the balance sheets. These are just some of the things you should know before investing.
A key component is also the charting of the stocks. If you ever back test penny stocks that have gone up by a lot, it usually broke a major resistance point before it did that. You always want to be on the lookout for that.
The other big factor is news. A big news event for a company can take it from a the depths of a penny stock to major player in the market. The next thing you know you?ll be reading about them in the Wall Street Journal.
Yet another factor is the what kind of ideas does the company have? An idea by itself could be worth millions of dollars. There have been so many companies that became major players in the market just because of some innovative ideas.
I know it’s tough having to go through all these factors, especially considering that you have a big list of penny stocks that you have to research. Thankfully for all us, there is software that has made process a lot simpler.
The makers of the software chose to offer an amazing newsletter service that makes stock picks on only penny stocks. The software comes up with usually four or 5 penny stocks to trade very month and has a great trading history.