Red Flag = Penny Stocks?
Ermm…. How about the fact that it is a Penny Stock? That alone is enough to say 'Buyer Beware'!
Playing with Penny Stocks = Playing with Fire.![]()
The bottom line? When I sense a conspicuous Red Flag alert, I would rather get out as I am not feeling confident and trade another day.
I feel worrisome with the danger, high volatility and low trading volume tagged to penny stocks.
Penny stocks come with high risks and the potential for above-average returns. But, investing in them requires extreme care and caution.
There is a very thin line between gambling and informed investing while dealing with penny stocks, and that is where risk management plays a critical role.
There is a phrase in the Chinese saying: "If you don’t have such a big head, then don’t wear such a big hat”.
I certainly do not have such a big head. Thus, I prefer to focus on higher quality stocks with much lower risk.
$Berkshire Hathaway-B(BRK.B.US$
$Disney(DIS.US$
$Fiverr International(FVRR.US$
$Procter & Gamble(PG.US$
$Starbucks(SBUX.US$
$Apple(AAPL.US$
$Boeing(BA.US$
$Microsoft(MSFT.US$
$Amazon(AMZN.US$
$Thermo Fisher Scientific(TMO.US$
$PayPal(PYPL.US$
$Intuitive Surgical(ISRG.US$
$Johnson & Johnson(JNJ.US$
$The Cigna Group(CI.US$
Playing with Penny Stocks = Playing with Fire.
The bottom line? When I sense a conspicuous Red Flag alert, I would rather get out as I am not feeling confident and trade another day.
I feel worrisome with the danger, high volatility and low trading volume tagged to penny stocks.
Penny stocks come with high risks and the potential for above-average returns. But, investing in them requires extreme care and caution.
There is a very thin line between gambling and informed investing while dealing with penny stocks, and that is where risk management plays a critical role.
There is a phrase in the Chinese saying: "If you don’t have such a big head, then don’t wear such a big hat”.
I certainly do not have such a big head. Thus, I prefer to focus on higher quality stocks with much lower risk.
$Berkshire Hathaway-B(BRK.B.US$
$Disney(DIS.US$
$Fiverr International(FVRR.US$
$Procter & Gamble(PG.US$
$Starbucks(SBUX.US$
$Apple(AAPL.US$
$Boeing(BA.US$
$Microsoft(MSFT.US$
$Amazon(AMZN.US$
$Thermo Fisher Scientific(TMO.US$
$PayPal(PYPL.US$
$Intuitive Surgical(ISRG.US$
$Johnson & Johnson(JNJ.US$
$The Cigna Group(CI.US$
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HopeAlways : Would avoid penny stocks as well
HuatLady : Well said. To play with penny stock is like playing with fire.
HuatEver : Long term goals of quality stocks investment sounds more sensible.
Louou : I am a little confused, which are penny stocks?
BangoLancer : Is the higher the price of the stock more stable?
SyueeOP Louou: A penny stock refers to a small company's shares that typically trade for lower than $5 per share. And some, may not be listed on any major stock exchange. Instead, it trades on the over-the-counter bulletin board.
$Kintara Therapeutics (KTRA.US)$
$Toughbuilt Industries (TBLT.US)$
$Great Panther Mining Ltd (GPL.US)$
$Color Star Technology (CSCW.US)$
$Senmiao Technology (AIHS.US)$
SyueeOP HopeAlways: Great minds like alike
SyueeOP HuatLady:
SyueeOP HuatEver: I concur!
SyueeOP BangoLancer: Generally(but not always), the higher a stock price is, the rosier a company's prospects may become. For some Penny Stocks, it is traded via OTC market. Such companies don’t have to adhere to strict financial requirements required by major exchanges.
The higher-priced quality stock with historically good margins, low debt and growth prospects may be a better investment than Penny Stocks. This is true even if you have to pay a little more for the more stable company.
There is another benefit, you can potentially take less risk, and, also, see an improved return.
Quality isn’t quite the same as value, whereas value is about buying the relatively cheaper stocks, quality is about paying a premium for companies with better track records.
In addition, quality stocks can do better at times of market stress, which is to say that quality stocks may outperform during a weak market.
$3M (MMM.US)$
$JPMorgan (JPM.US)$
$AT&T (T.US)$
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