| Although penny stocks don't cost a penny any more | | | | out. The one good thing that was left over was a |
| they still hold a lot of potential for new traders trying | | | | renewed interest in penny stock investing. |
| to make money on the stock market. While penny | | | | Traditionally penny stocks was way for aspiring |
| stocks have been around for a long time, they | | | | companies to get on the map and to find the capital |
| became really popular in the mid 1990's when the so | | | | to bring their ideas to life. |
| called dot com boom took over Wall Street. | | | | When all goes well, these stocks can turn into blue |
| This dot com phenomenon was known as the Penny | | | | chip stocks. When it all goes pear shaped, these |
| Express. A lot of money was made at either end of | | | | stocks become worthless and the company |
| these trades. For aspiring entrepreneurs, they turned | | | | disappears faster than you can say "penny". When |
| to the OTCBB to get venture capital and to get their | | | | investing in penny stocks the secret is to know the |
| ideas off the ground. Often these companies went | | | | risk and to hedge against potential losses. Even |
| from 10 cents a stocks to ten dollars a stock | | | | though you can make huge gains that you will never |
| overnight - the kinds of returns that most traders | | | | make on the major exchanges, the risk is there and |
| only dream about. | | | | something you need to be very careful of. |
| While this propelled a lot of entrepreneurs into | | | | Despite the risk, the reward is a great incentive to |
| massive wealth, traders got on the bandwagon as | | | | learn how to trade penny stocks. They can give the |
| well. While most of them would normally shy away | | | | "small guy" massive leaverage when trading and |
| from penny stocks, they now jumped unto it with | | | | without spending your life savings you can make |
| open arms, embracing it as the biggest opportunity in | | | | some decent returns. The key thing is to know what |
| decades. | | | | you are doing and to apply basic trading principle |
| Unfortunately the whole dot com boom came to a | | | | without getting swept away with greed and the |
| sad end as many market experts predicted. Even | | | | blinding promise of 1000% returns. |
| though some companies survived, most were wiped | | | | |