Penny Stocks - Small Investments

So in our previous blog we learned about 'Think Richly' mindset which is followed by the Millionaires of the society, please check out that blog if you haven't already

as this blog is continuation to that. So many of you will be thinking of investing money in shares and stocks but could not have been able to invest as it costs much and many of us are still in their student phase where they don't have an income source. To solve this problem I am here to introduce you to penny stocks. Penny stocks are stocks which are low in price which allows us students to invest and take experience of investing in market and also earn profit !!!

#1 What are penny stocks?

Penny stocks, because of their low price, are used to get trading experience for new traders. These stocks are very low priced, and it is almost risk-free to try your luck with penny stock trading. Penny stocks are quite popular with small investors because of their potential for huge gains. The gains may be in the range of 300% to 500% or even higher. Even if you have a small investment of Rs 100/-, you can still gain up to Rs 500/- profit.

#2 Multi-bagger Penny Stocks

Multi-bagger Penny Stocks are identical to penny stocks; the only difference is that their price rises every once in a while from the time you invest. If an investor invests in a stock priced at Rs. 10 and the price rises to Rs. 20, the stock is known as a two-bagger. Similarly, if the price exceeds Rs. 30, it is referred to as a three-bagger, and so on.

When the price reaches Rs. 20, it is a 100% profit, and when it reaches Rs. 30, it is a 200% profit and continues to rise. This is known as Multibagger Penny Stocks. There is no standard definition for multi-bagger stocks, however a stock is said to be a multi-bagger when it can provide 100% or more returns in a short period, i.e. when it becomes 2X or 3X its original value.

#3 Features of Penny stocks

Some characteristics of penny stocks include little liquidity, limited historical information, the possibility to become a multi-bagger stock, and relatively low values. Let's understand these:

1.Low liquidity: Penny stocks are typically connected with small businesses and move infrequently, indicating a lack of liquidity or available buyers in the market. As a result, investors may find it difficult to sell a penny stock during an emergency because buyers are not always available.

2.Limited historical information: Many of the companies classified as penny stocks may be newly formed, and some might be on the verge of bankruptcy. These businesses will typically have a poor track record or no track record at all. As you might expect, a lack of historical data makes determining a stock's potential challenging.

3.High Return Potential: Penny stocks typically have a higher level of volatility, resulting in a bigger potential for reward and, consequently, a higher level of inherent risk.

4.Low cost: Penny stocks due to their lower price have the potential for a substantial upside in share appreciation.

Okay, so now enough of all the technical terms here is a list of all the penny stocks you can invest in 2023:

• Yes Bank.

• Suzlon Energy Ltd.

• South Indian Bank.

• Reliance Power.

• Vodafone Idea.

• Bank of Maharashtra.

Thanks for reading the blog, if you liked it please check out our other blogs as well my friend is also writing blogs about coding and stuff do check him out. If you have any query about this please contact us. The next blog will be related to top stocks in India at the moment . Till then keep reading, keep learning, bye :D .