A Penny Stock Newsletter Can Revitalize Your Portfolio

By Tara Daniels


The stock market is an ever-popular investment avenue with many. While most investors stick to blue chip stocks, although these are usually safe they do not always offer the best prospects for capital appreciation. A good penny stock newsletter will be able to point a serious investor towards potentially much more rewarding opportunities.

These shares provide the opportunity for explosive growth under the right circumstances, and they can respond very quickly to any positive company news. Unfortunately, the volumes traded are usually low, so they would not normally be considered by short term traders. The shortage of available shares also means that any movements due to changes in demand become exaggerated.

Because of the shortage of buyers, it is particularly important not to wait for a downturn before taking your profits. By not being greedy and selling into a rising market it is easy to find enough eager buyers. Greed is even more dangerous than usual in this niche, as these shares are abnormally sensitive to negative perceptions and can quickly turn sour.

Keeping up with all the applicable shares and researching their prospects is a time consuming job. For people who live in countries other than the USA it can prove even more of a problem. This makes it worthwhile to get a summary of the best current research done by experienced experts who are in constant touch with any market moves and business conditions, and are familiar with the details of the company operations.

Because the prices of these stocks are so affordable, you can easily buy a large number of them. A one dollar rise is a much bigger percentage increase on these lower-priced offerings. However $10,000 is the same investment, no matter what the price of the underlying holding, but the actual increase is likely to be greater with a lower priced share.

It would be unwise to commit too large a portion of a stock portfolio to this type of share, although some should be held as they offer great growth prospects. How much should be invested depends on the size of your portfolio and your individual risk profile, and you should be able to afford the loss whatever you invest in such shares without suffering any hardship. It is also a good idea to spread your risk over several of the better penny stocks.

While these are not good trading vehicles because of the thin market for them, they still deserve a place in a longer-term strategy. The company fundamentals are particularly important when evaluating these shares. Buying them with a view to waiting until any potential has been realized can be a rewarding strategy.

By investing in a good penny stock newsletter you may be able to find shares which offer substantial performance gains for your portfolio. You should research what is available and decide on the basis of the track records of the different newsletters. You need to be sure that you will be getting great value for your money.




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