Unlike the traditional and highly regulated worlds of blue-chip stocks and mutual funds that may be offered by the big banks, the world of penny stocks and Forex trading entails significantly higher risks but also the possibility for much greater rewards. Both the penny stock exchanges and the Forex markets are highly unregulated, and as an investor in these markets you take on the risk fully upon yourself. Therefore this is completely different from the world of financial advisers and mainstream financial products such as mutual funds where you can expect to be guided in your investment decisions. Instead you are on your own in the world of penny stocks and forex trading systems, and therefore it’s critical that you educate yourself before you venture out into these often dangerous waters.
Penny stocks attract a lot of investors due to the extremely low buy-in costs. But of course before you buy into just any penny stock you need to be equipped with quality information sources which provide penny stocks watch. With traditional large companies it can take an excessive amount of capital to get on board. With shares in companies such as Google for example being worth more than $100 per share, you can imagine how much money it takes to buy a significant stake in such companies. With upstart penny stock firms however, shares are often priced at between $.50 and a dollar a share, at times are even priced below a penny a share, known as the so-called micro pennies. Therefore with a reasonable investment of a few thousand dollars you can own a significant number of shares and therefore stake in these firms. Think about that for a minute. If a pennystock goes up in value from $.01 to $.02, it has doubled in value, and so has your investment. It’s a lot easier for a penny stock to double in value than it is for Google to go up from $100 to $200 for example. A lot of people have made millions trading the penny stocks in this way.