In a famously published interview back in 2011, billionaire investor Warren Buffett revealed to Investopedia reporter Kent Baleevit, that he actually made his wealth from penny stocks and day trading.
“Although Warren Buffett is one of the investors widely credited with popularizing long-term value investing, the fact is he has long since abandoned that approach. Instead of buying giant boring companies and holding on to them for decades…Buffett has thrown his lot into penny stocks.”
Shocked? Well you shouldn’t be…
Even for investors like Warren Buffett who can afford to buy any of today’s big name stocks, the fast paced gains from low priced penny stocks are simply too good to pass up. And for smaller investors who can’t afford shares of Google or Apple, a relatively small investment in the right penny stock can net a significant return.
How It Works
When many exciting new companies go public, they often make shares available to average Americans for less than a dollar. These shares are called “penny stocks”. These have recently become very popular because small investors can easily afford to invest. Penny stocks are regulated by the SEC and other US authorities; however penny stocks are traded on the “over-the-counter” markets, not NASDAQ or the New York Stock Exchange.
Why Buy Penny Stocks?
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Penny Stocks don’t cost a lot of money
For the same price as one share in a company like Apple or Google, you now have the power to buy thousands of shares. For example, if you buy 10,000 shares of a $.30 stock, you would invest $3,000. If your stock reaches just $1, you’ve made $7,000, doubling your money. Imagine if your stock reached $2 or even $3, you can see how profitable penny stocks can become!
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Get Massive Returns in Days, Sometimes Even Hours
If you are subscribed to the right newsletter, you gain the advantage to potentially uncover penny stocks on the verge of exploding. Do any research and you’ll discover it’s not uncommon for penny stocks to double or even triple in 24 hours. Stocks traded on the NYSE or NASDAQ can take years to make you any substantial profit.
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Easy to Buy
The good news is you buy penny stocks the same way you buy major stocks. Establish an online trading account like TD Ameritrade to safely and securely make your purchase – it takes minutes. You can also use a traditional broker to place your trades.
You already know investing in any stock has a certain degree of risk, please do the research required to make the best decision.
