The easiest way to purchase penny stocks is to open a brokerage account and use the broker to purchase the stock for you, according to finance site Money Morning. A broker can also help you to avoid many of the scams and frauds present in the penny stock market.Know More
According to Investopedia, penny stocks are defined either by the market capitalization of the company offering them or by the price of the stock itself. For example, a penny stock is often defined as a stock offered by a company with a market capitalization between $50 and $300 million, while the Securities & Exchange Commission defines penny stocks as those stocks that are under $5 in price.
When buying penny stocks, the most important step is careful research of the stock in question, according to Money Morning. To avoid scams, such as the pump and dump, which involves pushing a stock price upward falsely before selling the stock at an inflated price, careful scrutiny of the stock is necessary. A broker generally does this for customers, but it is crucial that the buyer does a bit of due diligence before making the buy order. Penny stocks, like any other stock, need a firm business foundation to be a successful investment instrument, so examine the products or services of the company, its general outlook and its reputation before buying.Learn more about Investing
A person can get into the stock market by figuring out how much to invest, opening an account with a brokerage firm, conducting research on different companies and buying the stock. Beginners can practice an online version of the stock market before entering the real market.Full Answer >
To buy stock in Ally Bank, sign up for a brokerage account and then search for ALLY, the company's stock ticker symbol, as noted by CNBC. Ally officially trades under the name Ally Financial and is listed on the New York Stock Exchange.Full Answer >
"Penny stock" is a term for stocks from small companies that trade below $5 per share, and it does not imply that a stock is a scam. However, the low price and high risk of penny stocks make them popular in scams and securities fraud.Full Answer >
It is safe to trade stocks online if the consumer chooses a reputable online broker with Secure Socket Layer encryption and keeps antivirus and malware-detection programs up to date and active on his computer, according to Purch. Strength and safety of passwords is key too, says The Motley Fool.Full Answer >