Wednesday, August 19, 2015

How to Find Penny Stocks Before they Spike

Investing in Penny Stocks
Trading with penny stocks might be considered difficult and demanding, but it all depends how well you understand it all. The penny stock market is shifting with great speed, and in order to stay up-to-date with it, you will have to research and pay attention to various signs. Though, carefully overlooking how the market is functioning, you can follow up and predict which penny stocks will be worth investing in.

The Lifecycle of A Penny Stock
Keep in mind that most penny stocks go through predefined trading cycles, and if you do not see any of them getting promoted every half a year or so, it is time to move on. However, it is vital that you invest in these stocks so that you can get your money’s worth back before they drop after the spike. You must be careful which stocks you choose, so that you do not invest in a dud. Also, be wary that you will have to go through a few penny stocks to make any serious money.

Avoid Getting Scammed
Picking a good penny stock investment will take some time and effort, so you should never rush into it, no matter how good the opportunity seems like. On the other hand, there are scams out there as well.  These scams will try to take your money. Unfortunately, you will have to work on your skills to get good in recognizing promising penny stocks. Keep in mind that investments are a risky business, and, you will have to expect ups and downs.

You have to Look for Value
Your main goal will be to look for value in every penny stock.  It is not easy estimating the real value of stocks, and it is necessary that you understand how value investing works. Not only will make it easier to find stocks which are worth investing in, but it will make your long-term investing more worthwhile as well.

Find out How Others Trade with Stocks
Nobody can get good at something unless they research thoroughly, and learn from others. Timothy Sykes is one of the greatest penny stock traders who made a lot of money, which is why you should read up on him to find out his secrets. Moreover, you will be able to become better at finding penny stocks which are worth the time and money. On the other hand, you can find out what some of the most common mistakes are, so that you can avoid making them.

Keep Your Eyes Peeled
In order to make sure that your penny stock company is worth the investment, you will need to find out if there is any social buzz surrounding it. This way you will be able to see if the company or industry is going to become big, and if your initial investment can make a great return.  Be careful that you only follow positive buzz, and avoid any companies with negative feedback.

Watch How the Prices Behave in the Market
Determining when it is a good time to sell or to buy a stock will demand time and effort to develop such a skill. Nevertheless, it will be a great idea to watch how the prices behave, so that you are aware of the higher or lower prices of the stocks. This will be a crucial factor in deciding whether or not you can make money after the spike decreases.

The Perfect Time to Sell A Company
Trading with stocks is a good way to earn money, if you are skilled enough. Even so, in the long run, it will be imperative to know when to sell the company’s shares. It is never a good idea to wait for the peak of a company’s value as it might get out of hand, and you might end up with actually losing more money than you have initially invested in it.

Author: Nate M. Vickery is experienced business consultant and entrepreneur from Sydney, Australia. He is mostly engaged in real estate and investing. He also writes for