Stocks to Buy based on the Best Stock Market Research
We all gotta start somewhere..
I'm wondering what's the best approach for someone investing under $1,000. I hear the Penny stocks are pretty popular among us low capital investors but would like opinions from you fine people. Also is it best to invest all into one stock or diversify. The commission prices can add up very quickly when dealing with low capital is why i brought that one up.
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I'm in the same position you're in. I initially invested $1,000 about a month ago into my brokerage account, and just recently deposited another $1K -- $2K total was what I wanted to start out with.
I find it hard to choose investments with little starting capital as you mentioned because I don't get many shares with that amount of money. As a result, it is hard to take positions in more than one stock at a time. One of the things I've been reading in a book of mine is to make a general rule not to invest more than 2% of your overall portfolio in any one stock. I definitely don't adhere to this yet, as I've invested 25-50% in a particular stock at times. I know this is risky and I stand to lose possibly much or all of my money if I make the wrong decision, but it is a risk I am taking at the moment due to such a small starting balance.
Also I would like to maybe entertain the thought of playing penny stocks, but I know they can be quite risky and I would prefer to build my bankroll up before I start taking on things that are riskier like that.
So far I have executed about a handful of trades -- indeed you are right that commissions can get costly. It definitely makes you focus in on target entry and exit prices so that you determine where your break-even point is and at what point you will decide to bail if it goes too low, or bail and take profits if it does go up.
I'll be interested in sharing some thoughts and stories with you as your trading career progresses. It's nice to see the perspective from someone in almost the identical situation as myself :)
Investing in Penny stock is dangerous but can make you some quick cash. It's not for everyone but it has done ok for me. My (2) rule of thumb are simple:
1) don't be greedy, make your 10-20% and get out and don't worry about how much more it can go up. Set my account up to sell on LIMIT ORDER.
2) as soon as you make the profit, move it right out of your account and back into your personal account so you don't use your money to invest. The idea is to make the money and continue to re-invest by using the winning money.
has done well for me recently; however, I would stay away from HEV now
i am not too sure if you can break it down this way, as it will require the stock to go up 7% (using scottrade when the fee is $7) before you can break even for your $200 investment and of course it needs to go up 14% for your $100 investment.
i do agree for looking at companies that have demonstrated strength all year.
Most of these replies will get you in the gutter. When you buy a penny stock, unless it is being pumped it is sure to go down. Do not try to day trade, you will lose 20% in a day or two, the next day you will want to get back faster so you will pick a riskier stock and lose another 30% in one day, now when you're down 50% you need to make 100% just to break even. Same with fas and faz, they are losers in the long run.
Your best bet for $1000 is either A: massive research and find something undervalued that has good potential and little risk because they have enough cash, or B: multi month deal with a slow mover that might pick you up 40% over the next few months.