It’s presumably the most common question that investors have. The answer is simple lower threat and potentially advanced return.

Penny Stocks are less parlous than other stocks because they’re much easier to buy, vend, and trade. They’re also liquid, so you can get in and out of the request snappily if necessary. These two factors make them less parlous than investing in other types of means, similar as real estate or collective finances, which can be delicate for someone who doesn’t have important experience investing or trading stocks.

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Features of Penny Stocks
Then are the crucial features of penny stocks

Low request Price
As bandied, penny stocks are by their description the bones that are available and at a fairly low request price. Grounded on price also, penny stocks are casually distributed under different price heads like- penny stocks under Re 1, penny stocks under Rs 10, etc. The reason behind their low price is the low request capitalization of the company. Having said that, it isn’t that their price always remains low. Some penny stocks can grow mainly in value and come out from the order to be called multibagger stocks.

High Volatility
Penny stocks are also known for their high volatility. substantially preferred by the bones looking for short- term gains, penny stocks are generally bought and vended in huge amounts by big dealers. For illustration, you can buy 10000 units of a penny stock of Re 1 with just Rs,000. The buying and selling of similar low- priced stocks in similar high amounts induce extreme volatility. This is the reason why the price of penny stock changes veritably sprucely in an unanticipated manner. For the same reason, penny stocks are generally considered largely parlous investment options.

Low Liquidity
This is yet another threat factor in penny stocks. frequently they’ve vastly low liquidity and may push dealers into a situation where either they don’t get enough buyers to vend the effects, or enough merchandisers to square their short positions.

High Return Offering Implicit
The only reason why we’re still learning and minding to read about penny stocks is the reason that can come someone’s reason behind their rags to- riches story. The stylish penny stocks list is filled with a number of stocks that have multiplied in their value exponentially within a veritably short period of time. similar stocks, as we read over, are called multibagger penny stocks. We can understand this with an illustration- Suppose you buy 5000 units of Re 2 stock that bring you Rs,000 overall. Indeed if the stock prices increase by 50 paise, making its request value to be Rs2.5, you’ll earn a profit of Rs,500, which is 25. And this is enough normal with penny stocks. 25 is nothing, penny stocks can give 300, 400, and indeed further than 1000 return in a veritably short period of time.