In this article, we’ll talk a bit more about some very important concepts on how to buy best penny stocks in 2018 given that penny stock market is constantly evolving. More often than not, people think that pre-trading activities are not worth it – hence due to lack of required readings, skills and knowledge they miss out a chance to become a self-sufficient trader.
Speaking of pros and cons of the industry, penny stocks could be described as a bad idea by some or a lucrative investment by others. The statements are both true –you have to decide which one you stick to. However, if you pick out 2nd statement you have to understand that preparation and studies are your keys for the future success.
Start with the basics
We would go down even further and start out with penny stock definition – a stock that trades in the range of $1 up to $5 (depending on market conditions) for a mid-size company with Market cap of less or equal $300 million. Best penny stocks are usually stand for companies with distinctive performance and solid fundamentals. Should you want to know how trade them successfully –take the time to learn more otherwise you would fail without trying. Penny stocks are quite volatile – hence more risk flows in while trading. Without proper skills you won’t get a proper trade done rather play a slot machine. Hit the books, paper-trade and do your own due-diligence before put your hard money in.
How to identify best penny stocks in 2018?
As stated earlier, penny stocks are very volatile instruments that could either double your ROI or wipe off your trading account in just a matter of hours. If you feel this is not for you – you better not invest and find another direction of making money. However, if you plan on staying then get ready to encounter difficulties along the way.
The underlying company is the fundamental driver for the best penny stock upward and downward moves. If you notice a penny stock at all-time highs then something important has happened to the company as such a growth should be justified either way. Check out companies balance sheets, QEs, annual and sales reports. You have to keep around 3-4 penny stocks to keep under radar at all times. Also, make sure all the penny stock data is available on the internet so you can reach it within short time.
What industry to look at in 2018?
As soon as you are done with the above guidelines, it’s time to start analyzing the industries across the board. What are the big winners of the year? What industries have best penny stocks? In this research, you need to adhere to a certain assessment tools which help you point at leading industries of 2018. Now, it’s important to read news which in one way or another relates to penny stocks. The more work you put in, the better list of best penny stocks you’ll get at the end.