Are Penny Stocks Dangerous? Information On Pink Sheet Stocks
Penny Stocks are defined as common shares of a small public company that have a value of less than $5.00. Because of its small value they are often targeted to manipulate the price. For example, a person may purchase a huge amount of shares and release faulty information. This may cause the penny stock to rise in price drastically when it shouldn’t have and the scammer may sell his shares, causing the price to plummet.
This is why before any kind of investment is made in a penny stock, it is important to go through technical and also calculative research concerning the entire performance of the company. Success in penny stocks is purely based on research and technical indicators. With the correct research and the right companies, these kinds of penny stocks include less risk and are better suited to move in the investors favor. Thus, in order to know if penny stocks dangerous it is important to know the benefits that these kinds of stocks offer: