Best Penny Stocks For 2019 In India
Penny Stock, which the Securities and Exchange Commission defines as a small company for less than $ 5 per share and occupies a disputed corner of financial markets in an over-the-counter market.
Since the shares display this business from major exchanges and face some disclosure requirements, then they have been a tool for fraud schemes for decades.
A common perspective is a pump and a dump where a stock is promoted before leaving criminal posts. This was the way Wall Street’s so-called Wolff Jordan Belfort enriched himself before being caught.
Regulators have increased their views about money stock. SEC’s Economic and Risk Analysis Department published a white paper in 2016, highlighting the risks of an investment in over-the-counter markets.
The SEC said that most investors lose money in trades, and there is a loss for those shares which were the subject of promotional campaigns and were poor disclosures.
First Adviser is the Best SEBI Registered Stock Advisory Company in India.
Best Penny Stocks For 2019 In India
The first consultant gives some rules for penny stock trading:-
Stick to Your Trading Plan
This is a high-level, big picture and strategic business rule. In the business, so many people fail that their preparation becomes useless.
Preparation is key. So how do you prepare? In addition to studying like crazy, You create a plan.
Now, I know that maybe people are reading it, thinking, cool. Make a plan. How do I do that? And what should be in my plan? The key and it is too big, have to stick to your plan.
Always use Stop Loss
One stop loss can save you from losing more than your planned risk capital. In other words, suppose you have made a business plan, then you know how much damage you want in a business. You have a predetermined exit point.
But I want to clarify something: I do not use electronic stop loss like I do not use market orders. I use mental stop loss as a trading rule.
It’s super important, so note that. If you are in a business and it is wrong, then you want to get out, right? But what if there is a panic? What if the price falls 50% in 10 minutes? You want out, right?
Think of it like this: Suppose you have set an electronic stop loss as part of the business. If the stock falls so fast when the stop-loss triggers, then your order is not executed?
After all, it is executed – but in the form of the market order. In other words, your order is executed at market value, which can not be anywhere near your trigger.
Keep Trading in Perspective
The best is not perfect in any field. Think of baseball for a second. Even if you hate baseball, you can know that a great batsman hits about 30% of his batsmen. This means that they fail for more than two-thirds of the time.
Here’s another example: NBA-Legend Michael Jordan’s career area-goal percentage was 49.7%. His career was three-point area-goal percentage 32.7%. First Adviser is arguably talking about the greatest basketball player of all time.
Of course, there is much more for basketball than shooting and much more for baseball than hitting. Just like how many trades you win or lose, there is a lot more to do.
The skill I teach to my students is a skill that can live throughout life. Put the business in perspective. Keep your feelings out of as much as possible. Always preparing for victory and defeat. Do not expect to work fully from every business.
Benefits of Penny Stocks
The first benefit of penny stocks is the price of their shares. Since you are buying shares in money, you will not need to invest a large amount to start investing.
The second benefit of penny stock is its availability. These shares are available to invest in the general public. Low cost allows investors to buy as much as they want.
Therefore, if you do actual background research or industry analysis and manage your investments wisely, you can earn more profit on penny stock investment.
Most traders and experienced investors like to invest in penny stocks due to their high volatility. Penny stocks move on fast intervals.
Suppose you have 1000 shares of emerald stock, which is trading at Rs. 3.00 and the price doubled only overnight, then you doubled your returns very easily.
Loss of Penny Stocks
Where there is a possibility of maximizing profit, the probability of losing all the investments is also equal.
Penny stocks are issues by most small companies or startups. Therefore, if the company is close to being bankrupt then one can lose the entire investment in a shot. Apart from this, the risk of the price is not associated with the newly established companies.
Pumps and dumps- scams are also very popular in money stocks where some people popularize stock to increase demand, which leads to an increase in prices. The end result, that stock will crash and only those who take advantage of it have purchased that stock before the scam.
And finally, the annoying loss of money stock is their liquidity. It is very difficult to sell large amounts of money because they do thin business on a daily basis in the stock market.