Knowhow-Now Article

Penny Stocks: Aren’t All Penny Stocks A Scam?

Most Internet e-mail users have been subject to penny stock scams. There are more than fifty billion spam messages sent each day, and many of these mention investing in penny stocks. Spam isn’t a very reliable investment source, right? Does that mean that all penny stocks are, essentially, some sort of scam?

Penny stock scam is a sad fact of using the Internet. It’s possible for people to lose 8% of their investment when falling for these penny stock scams online. Often, these penny stocks do not exist or they do not exist at the advertised price. This type of scam is called a “pump and dump.” Yes, there are some scams on the Internet that center around penny stocks.

Tip: Learn about the stock market by watching what it does. Keeping track of the market before you decide to buy can help you know what you're doing.

This does not mean that all penny stocks are a scam, or even a bad investment. There are some penny stocks that can make investors a good amount of profit, in fact…just not the ones you find advertised in spam. Stopping yourself from investing in those penny stocks is a great idea, but deciding never to invest in penny stocks of any kinds because of that may not be.

Yes, there are considered a high-risk investment, but it’s also possible to turn a pretty profit by using penny stocks. In most cases, there is a certain finesse needed to invest in these stocks, as they rarely trade and sometimes things happen with penny stocks very quickly. Investors have to know what’s happening all the time and be ready to make a move when needed – making penny stocks somewhat exciting and interesting to trade in. This is why some investors like them.

Tip: Stocks are more than just pieces of paper made for buying and selling. When you own some, you become a member of the collective ownership of that specific company you invested in.

Don’t let Internet scams scare you away. There are a lot of Internet job scams, too, where so-called “employers” offer to pay you lots of money to do something simple like answer surveys or surf the “Net. In many cases, these “job offers” turn out to be nothing but an Internet scam, and a clever ploy to try and get your hard-earned money. But you don’t let Internet job scams keep you from working – so don’t let Internet penny stock scams keep you from investing. That still means that the scam artists win, because they’re keeping you away from something.

To learn which penny stocks are potentially good investments and which are potentially bad, there’s lots you can do. Check the business journals and stock information, or ask a broker for more information and advice regarding penny stocks. There are good penny stocks out there, and there are investments out there where you can make a lot of money. By doing your research and looking into every possibility, you increase your chances of success in the stock market. And isn’t success what it’s all about?

If you’re interested in investing in penny stocks, you can’t let anything (even scams) stop you. Do what you want to do and invest your money where you think it’s best. After all, it’s your money and only you can decide what you want to do with it. Make the choice for you, not for any other reason.

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