Penny stocks don’t actually cost one cent, any stock trading for under $5 a share is considered a penny stock. These types of stocks are high-risk investments, but that risk includes the possibility of big rewards. Penny stocks are extremely volatile so it’s a good idea to invest only in the best companies. The top penny stocks have favorable valuations, good prospects for growth, good ROE%, and a current ratio that indicates that the company isn’t in any immediate danger of bankruptcy. Trade discipline is imperative when trading even the best penny stocks, so make sure you have a solid
What makes a stock cheap? Well, there is a big difference between price and value. The best cheap stocks aren’t just cheap, they’re undervalued. In order to pick cheap stocks with potential, you need to learn how to evaluate a company. Cheap stocks have a low share price, but unvalued stocks have a low share price in comparison to the company’s true value. Share price is the cost that you pay to purchase one share. However, share price is only one factor in determining the true value of a stock. Don’t make the incorrect assumption that you’re looking at a
A day trade occurs when a trader opens and closes an equity position in the same trading session. Day traders look at trades differently than investors and swing traders. The best day trading stocks are totally different from traditional investments. Before you start, know that day trading is high-stakes and high-stress. Profitable day trading requires extensive research and analysis, so it’s not for everyone. If you still want to jump in, here are a few pointers to help you succeed. The best day trading stocks have two key attributes: liquidity and volatility. In day trading, the stakes are so high
Robinhood is a mobile trading platform that allows users to trade stocks with no fees or minimum balances. The app has been a godsend for novice traders and investors with small portfolios, and Robinhood penny stocks have become particularly popular amongst day traders. Users can trade equities and penny stocks listed with NASDAQ and NYSE with no commissions or hidden fees. Investors can even trade option contracts without commissions. Yes, it’s really free! Other companies have attempted to launch zero-commission brokerage platforms in the past with little success. Traditional brokers couldn’t offer zero-commission trades and simultaneously turn a profit, but
If you follow the markets, you’ve likely seen share prices jump when a famous analyst makes a “strong buy” call on a stock, but what exactly makes strong buy stocks worth buying? There’s no universal formula to evaluate equities, and analysts each have their own unique criteria for determining strong buy stocks. However, a statistic that is consistently used to evaluate stocks is share price per earnings. Price/Earnings = Earnings ÷ Share Price A company’s value is largely determined by its earnings. Dividing earnings by share price tells us the rate investors are paying to own a piece of the
The knock on gold for years has been that it’s not an investment, that it doesn’t produce revenue, pay you interest or dividends. Famed investor, Warren Buffett has been quoted in the past as saying: “It doesn’t do anything but sit there and look at you.” However, there is a way for investors to gain exposure to the gold market and still generate a yield. Now, it won’t come from buying physical gold bullion or trading gold futures contracts. You can receive income from gold and still benefit off its potential rise by buying gold stocks that offer a dividend. The
Since 2001, the price of gold has moved from $265 an ounce to over $1,300 in 2017. That’s a cumulative return of over 390%. Gold has been recognized as a currency for thousands of years. It has a universally recognized value, viewed as a hedge against inflation, and adds diversification to a portfolio consisting of stocks and bonds. However, at these current prices buying physical gold is out of the question for small investors. Also, if you do decide to amass a large portfolio of gold bullion and coins security and storage become a concern. Trading futures is also not
Investors are interested in silver for many reasons, whether it’s a hedge against inflation, flight to safety, or even speculative purposes. Now, there are several ways someone can gain exposure to the silver market. However, if you want something that is hassle free, then buying silver stocks is the way to go. Investing in silver companies is easier and more convenient than buying physical silver or trading silver futures. Physical silver can have high transaction and storage costs. On the other hand, silver futures contracts require active management. Huge volatility spikes could lead to receiving a margin call. In order
Investing in gold stocks adds diversification to a portfolio. Historically, gold has had a negative correlation to equities. It’s also viewed as a hedge against inflation and a flight to safety investment. Why should you buy gold stocks instead of owning the physical metal? Gold bugs will argue that if you don’t have gold your hand you don’t own it. However, there are several downsides to owning gold. First, its expensive. Spot gold closed above $1,300 an ounce in 2017. When you buy physical gold, there is an additional premium added to the spot price. A 1 ounce American Gold
Investing in gold via the stock market is relatively simple and straightforward. Unlike buying physical gold, security and storage are not a concern when buying the best gold stocks. In fact, some of the top gold stocks even outperform physical gold. You see, gold mining companies that operate efficiently are able to produce gold at significantly lower prices than spot gold. Since their operating expenses are rather stable, a spike in the price of gold should mean greater profits for the gold mining producer because they’re able to sell gold at a better price. As an investor you have several