About to Buy Penny Stocks? Look at These 3 Companies First
The Securities and Exchange Commission defines penny stocks as securities trading under $5 per share issued by companies with very small market capitalizations. Stocks in this category often attract investors looking for explosive gains in short periods of time, but they come with very high levels of risk and have low rates of success.
While penny stocks might look cheap on a superficial level, the underlying companies tend to be very shaky and provide little visibility into their operations and outlooks. Instead of taking a gamble on penny stocks, risk-tolerant investors seeking market-crushing gains should consider Zynga (NASDAQ: ZNGA), Himax Technologies (NASDAQ: HIMX), and Zuora (NYSE: ZUO).
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Source Fool.com
