Is it possible for people to actually make a substantial profit using Penny Stocks, even to become millionaires? Certainly there are some people who make huge amounts of money from stocks, regular folks who trade on their own time perhaps as a hobby rather than as a professional trader. However, it is very likely that even though they started with penny stocks, they eventually moved on to other potentially more profitable stocks using larger sums of money once they felt they had more experience and had more money to spend. Of course, the question then becomes how do you start making quick profits on penny stocks with the least risk?
Before we answer that question, let’s quickly define what exactly we mean by penny stocks. There are different precise definitions, but in general the phrase refers to low-priced, highly speculative stocks that typically sell for less than $1 per share. They are very volatile and can go up and down hundreds of percentage points in minutes, sometimes as much as 400%. Of course, this can be dangerous, but it can also be extremely profitable if you know what you’re doing.
Now that we know what penny stocks are, how can we quickly determine what to trade and when to maximize our profits? Remember, it’s usually only after we’ve made a series of small, low-risk trades that we can think about making the kind of trades we need to make a lot of money quickly. In most cases, traders simply have to put in hours, weeks, months, and years, to gain experience in the market. Only after trading many times and analyzing the trends and results over a long period can a trader say that he really understands stock trading, and even then he will lose on many trades.
However, of course, many shortcuts are offered. There are many “systems” available, ways to help you identify profitable trends and opportunities as they occur, but there are big problems with most of them. The main problem is simply that any system is still based on the analysis of historical trends, and this takes time and effort. However, there may be a new solution.
Two computer programmers have created a piece of software that performs stock scans looking for companies that are forming bullish trading patterns, meaning their stocks are about to rise. This software constantly records historical information and learns more and more over time, each week generating recommendations for stocks it thinks should be bought and sold. These recommendations are only made when the software trusts the result, based on the large amount of data it has analyzed.
Of course, as with all stock trading, and particularly in the volatile penny trading market, not all decisions will be correct, even software cannot predict all possibilities. But on average, the software is reported to create profits of 105.28% per week, even taking into account trading recommendations that don’t work. Could this be the key to making significant profits from penny trading without spending years as a trader? Apparently, if someone had put $5000 into each of the recommended trades for 4 months last year, they would have made $387,684 in profit.