Penny stock


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Penny stock

Used in the context of general equities. Stock that typically sells for less than $1 a share, although it may rise to as much as $10/share after the initial public offering, usually because of heavy promotion. All are traded OTC, many of them in the local markets of Denver, Vancouver, or Salt Lake City.

Penny Stock

Stock in a very small company with low market capitalization and low prices. Penny stocks are considered highly speculative and rarely are traded on an exchange because so few meet listing requirements. While there is no hard-and-fast definition of what stocks are considered penny stocks, they usually have a share price under $5 and come from a new, unestablished company. While most companies issuing penny stocks fail, investing in these stocks can lead to extraordinarily large returns.

penny stock

A low-priced, speculative stock. Although the maximum price at which a security may sell and still be classified as a penny stock is subject to individual interpretation, $1 is probably the most commonly recognized limit. Many penny stocks are traded in the over-the-counter market and on smaller exchanges.

Penny stock.

Stocks that trade for less than $1 a share are often described as penny stocks.

Penny stocks change hands over-the-counter (OTC) and tend to be extremely volatile. Their prices may spike up one day and drop dramatically the next.

The fluctuations reflect the unsettled nature of the companies that issue them and the relatively small number of shares in the marketplace. While some penny stocks may produce big returns over the long term, many turn out to be worthless.

Institutional investors tend to avoid penny stocks, and brokerage firms typically warn individual investors of the risks involved before handling transactions in these stocks.

However, penny stocks are sometimes marketed aggressively to unsuspecting investors.

References in periodicals archive ?
It is the new pricing methodology that has injected liquidity into those penny stocks which allowed their prices to fall below 50k,' Uwaleke said.
Basrai and Stirton also agreed to be barred from trading penny stocks and from working in the securities industry, with Stirton having the right to reapply after five years.
FINRA also found that the firm's systems and procedures governing penny stock transactions were inadequate, and were unable to determine whether stocks were restricted or freely tradable.
Although exchanges put most penny stocks in the trade- totrade ( T2T) category, many are included in the B group on BSE.
He adds that it's difficult for investors to profit in trading penny stocks, with their low trading volumes and low prices, because quotes don't move much.
Given their scandal-plagued past, penny stock IPOs appear to be particularly well suited for examining issues involving market manipulation and informational asymmetries.
SEC Fines Ex-Oppenheimer Employees in Penny Stock Case
About a year and a half ago, I was in a difficult situation and decided to invest in two penny stocks hyped in an unsolicited email.
com)-- Nearly a year ago, Peter Leeds, the expert in penny stock investing and publisher of the Peter Leeds penny stock newsletter, made his predictions for 2012, as published in BE America's Edition January, 2012.
Quote: ``It's a penny stock at this point, but it's done very well from that modest level.
The board recognizes that considering the size of the company and the nature of our business, penny stock investors are not able to evaluate our company the same as companies of similar size with a more traditional penny stock company business," Mr.