We all know that trading in penny stocks contains a large element of risk, but that doesnt stop many us from being attracted to the potential rewards that they can generate. One way many investors look to minimize their risk trading penny stocks is to signup to online newsletters which claim to send the best picks on a regular basis.
Free Penny Stock Newsletters
The problem with free penny stock newsletters that send out the latest penny stock picks is that you often have no idea who is choosing the picks or based on what information. Does the author have a track record or are they simply picking the penny stocks that are causing the most discussion on the various penny stock forums? Even worse, they could be accepting solicitations from various companies or individuals to pick a certain stock.
Best Penny Stock Newsletter: Penny Stock Finders
One service I hihgly recommend is Penny Pick Finders. Penny Pick Finders is a better kind of penny stock resource. They offer more in-depth newsletter information to small-cap and penny stock traders, specifically in the OTCBB and Pink Sheet markets than any other penny stock newsletter out there. Their goal is to provide both their members with a sound knowledgebase of the OTC Markets, and timely alerts of unknown stock plays, with massive growth potential. They strive to bring their members the breakout securities in the small-cap and micro-cap sectors of investing, before the rest of the market catches on. You can now sign up for a free trial justclick here.
How To Reduce The Risks Investing In Penny Stocks
Another way to reduce the risks of investing in penny stocks is to avoid the free picks that sometimes come out of the blue. For example if you are active on some forums or blogs and strike up a rapport with other users and then one day find a hot pick in your email inbox from one of the other users, treat it with a high degree of suspicion. In this day and age, fraudsters know that sending out millions of spam emails doesnt produce the results like it used to so instead they need to build an association and rapport with individuals and then send them the pick. While it takes time and effort for them to do this, its far more effective than sending out emails and because the victim feels like they are getting a personal recommendation from a friend and they are more likely to act on it.
Penny Stock Forums Are A Meeting Place Of Scammers!
Similarly, on the forums and chat rooms, you will have shills and fraudsters looking to “pump and dump” penny stocks. Since it only takes a small price movement to make a lot of money and the volumes required to move the share price up (or down) is so low, be mindful of people making excessive noise about a particular stock and certainly avoid anyone who claims to have inside information that the stock is about to soar!
At the end of the day, no amount of 3rd party picks can replace your own research, so while you might want to subscribe to various penny stock picks when you start out as a penny stock trader, you should also be looking to develop your own research methods or even look to specialize in a particular industry niche like bio-genetics or integrated circuit boards (computer chips) so that you know if a company has the potential to make it big with their invention or new patent.
Recommended Penny Stock Newsletters
1.Penny Stock Psychic
2.Penny Stock Finders
3. Penny Stock Formula
4.Penny Stock Scientist