Trading stock sfor less than 1 cent??

jaybo16

Newbie
1 0
I'm wanting to trade penny stocks but im concerned about placing trades for stocks worth less than 1 cent. For example, if i buy shares for 0.0001 and sell for 0.0002, have i doubled my money? Or will it make no profit, as they are both worth less than 1 cent? I just don't want to buy 100,000 shares at a cheap price to find out i cant sell them for profit when they go up a little.
I guess what I'm asking is...is there a minimum stock price for which an increase will turn over a profit, or can i make a profit from stocks of ANY value, including fractions of a cent?
Please, keep the answers specific to the question, I don't want to hear comments about the pitfalls of penny stocks as i already know the general risks. I just want to know the answer to this particular question. Thanks!
 

timsk

Legendary member
7,348 2,139
Please, keep the answers specific to the question, I don't want to hear comments about the pitfalls of penny stocks as i already know the general risks. I just want to know the answer to this particular question. Thanks!

Hi jaybo16,
Welcome to T2W,

It's very difficult to respond without referencing the pitfalls of trading penny stocks as they are all highly relevant to your question! I recommend you review them and that will tell you pretty much all you need to know.

In short, there isn't a set minimum stock value above or below which a trader / investor can or can't make a profit - there are just too many variables. However, my personal view is that you've got a snowball's chance in hell of making money on stocks valued at less than a cent. If you do - it will almost certainly be pure luck - and there's no way (that I've ever heard of anyway) of formulating a viable trading methodology with a positive expectancy over the medium to long term doing it.
Tim.
 

jacknapier

Active member
157 2
Those stocks are controlled by crooks and you will not make money attempting to trade them. No viable company is going to trade at 1 cent.

I'm assuming you are new to trading. Just forget about penny stocks. In theory, they are tempting, but in reality you will only lose money.

If you're dead set on penny stocks, the only way to trade them is if you understand the fundamentals of the sector very well. But generally speaking, you want to avoid stocks that are less than 5$. You can double your money with 20$ stocks far easily than 1$ stocks, because the stock that costs 1$ is more likely to go bankrupt and you will lose all your money. Does that make sense?
 
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Splitlink

Legendary member
10,850 1,233
I'm wanting to trade penny stocks but im concerned about placing trades for stocks worth less than 1 cent. For example, if i buy shares for 0.0001 and sell for 0.0002, have i doubled my money? Or will it make no profit, as they are both worth less than 1 cent? I just don't want to buy 100,000 shares at a cheap price to find out i cant sell them for profit when they go up a little.
I guess what I'm asking is...is there a minimum stock price for which an increase will turn over a profit, or can i make a profit from stocks of ANY value, including fractions of a cent?
Please, keep the answers specific to the question, I don't want to hear comments about the pitfalls of penny stocks as i already know the general risks. I just want to know the answer to this particular question. Thanks!

They tell us that if we trade with SB companies we are gambling! :D What about you? You want to trade penny stocks? You go ahead and do it but I would not touch the broker (?) that you are dealing with, let alone the share.

Anyway, how much would that be? $10, or $100 (it's a question of moving the decimal point). I spend $4 weekly on Euromillions. You have to put it all into perspective but there are some imprudent people willing to spend thousands on junk like that.

PBoyles & Co. had better come over here, while the thread lasts, because someone needs help!!
 
 
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