PENNY STOCK TRADING STRATEGIES COURSE

We are all about helping our community members learn how to trade the proper ways. We are not a pump and dump community, we are teachers that are all about helping our community members to become profitable and safe traders. Each day, we teach live how to trade the markets. Check out our live trading room.

OTC

Penny stock trading strategies are important when you begin trading in this sector. Penny stocks usually trade outside of the major market exchanges. These small cap stocks are priced under a dollar.Typically penny stocks are seen as high risk. Since penny stocks are usually small companies, they have fewer filing and regulatory standards. This causes a lack of liquidity and large bid-ask spreads.

Penny stocks are usually known as OTC (over the counter) or pink sheet stocks. Pink sheets are a compiled daily with the bid ask spreads. Pink sheets aren't required to file with the SEC. Because these stocks are risky, making sure you have good penny stock trading strategies is paramount. The attraction of penny stocks is the fact that they don't cost a lot. They also promise big profits. 

Who wouldn't want to spend only a little to make a lot? It sounds too good to be true right? Usually it is. There is money to be made. But there's also money to be lost.  Typically losing means losing big.

Scammers run the penny stock game. That's why you need to be careful. Plan out your strategy and stick to it.

When you want to invest in the stock market with little money penny stocks are attractive. Buying stocks like amazon, apple or google can seem out of reach. For example, you see a stock that's $0.30 so you want to make a little money. You buy 10,000 shares and spend $3,000. It gets to $1. You've just made $7,000.

Learning how to control your emotions is one of the most important aspects to trading. Anyone can learn the technicals if they study enough but learning how to control your emotions is one of the toughest aspects to trading. We are emotional people and the emotions of fear and greed are the downfall of most traders.

They want to get rich quick and be in on the action and this is what messes up their trading decisions. It takes a lot of time to learn how to control your emotions when trading and that's why we recommend paper trading for months first before trading with real money.

Make a few hundred paper trades first and then slowly scale your way up trading with real money. If you're not able to trade profitably in a paper trading account first then it's going to be very hard to make money in your real brokerage account because the emotions will really mess with your head. Check out our trade alerts.

TRADE HIGH VOLUME

You need a lot of volume when you're trading. Stick to penny stocks that trade at least 100,000 shares a day. Ideally, 300,000+. If you're trading stocks with low volume it could be difficult to get out.

When you're trading with high volume, the stock will be volatile. Volatile up or down. That's exactly what you want, movement and price action. The volatility is going to push the price. Price can move pretty quickly and emotions will often flood in.

So, make sure you don't hold for a long time. Get your gains and get out. Use mental stop losses. Penny stocks are moving quickly and a stop can be triggered in a second then bounce back even higher. 

Since penny stocks tend to have large bid ask spreads, there's a higher risk of losing money. Mental stops take more concentration. You're not relying on that hard stop loss you've use in larger cap stocks. Hence the need for penny stock trading strategies. Take our free stock market courses for beginners.