I am new with your service but I bought one of your recommendations and in three days I have doubled my money. Every week I try to buy one of your choices.

Your Own Picks

Learn How To Pick Your Own Penny Stocks

If you're the kind of investor who likes to be in charge, and if the penny stock market appeals to your sense of adventure, maybe you're ready to learn how to pick your own penny stocks.

Your first step will be to spend some time doing a bit of research. The more you learn now, the more you'll improve your chances for success later. A little work can go a long way and there are plenty of materials available to help make the journey easy and fun.

And by all means, make sure you have a trustworthy guide. PeterLeeds.com has been in the business of researching this market for many years. We are highly respected in the industry and have a good handle on selecting the best small cap investments with the highest profit potential.

This report is just a sample of the level of support we offer freely. It's for those of you who want to be in control of your investments. You will find a quick overview of the nature of penny stocks, some tips on where to begin doing your own research, and the importance of keeping a professional penny stock newsletter handy as a reference.

We've also added some valuable pointers on evaluating potential investment opportunities as well as some of the pitfalls to avoid.

Resources

To help you get started, we recommend reading "To the Right of the Decimal Point: Understanding Penny Stocks" by Peter Leeds. The knowledge you gain from this book can help you quickly identify which are the best choices from pools of thousands of stocks. You'll be able to easily rank stocks, and more importantly, you'll be able to recognize and avoid some common mistakes.

You should also become a member of Penny Stock Insider so you can start taking advantage of our specific investment picks, hot list reports, and our daily updates.

Using Professionals

If you are new to penny stocks, we recommend that you do read a professional penny stock newsletter. Peter Leeds has been in this business since 1992 and our track record for picking hundreds of winners has made us an industry leader.

There are other penny stock services out there with skillfully designed Websites, but not a lot of analysis expertise. After checking out the others, more people choose Penny Stock Insider than any penny stock newsletter. In fact, with 14,000 subscribers, it's one of the most popular financial newsletters of any kind in all of North America.

A Little Work

As we mentioned, a little work can go a long way. Unfortunately, most traders aren't willing to spend the time it takes to get a better understanding of the market. Those who are willing often don't know where to begin or what questions to ask.

Indeed, almost everyone who gets involved with penny stocks does it for the wrong reasons. Maybe they heard a hot tip from a friend at work and ran right out to buy some shares before the stock became common knowledge. Unfortunately, and we hope we don't bruise any egos here, but by the time they heard about the shares, it already was common knowledge.

There are hundreds of companies offering penny stocks today. Our purpose is to help you choose the 5% of the market that we believe has real potential. And after you read this report, we think you'll agree that it really can be easy to rule out the less attractive penny stocks.

Then as you begin to do your own research and become even more experienced, you'll learn that a smart penny stock trader can make money regardless of whether a stock is considered a good one or a bad one. It's all a matter of timing. All stocks fluctuate and even stocks in the worst companies can make you money if you buy at the right time. You can also lose money if you buy the best companies at the wrong time.

Ideally you want to accumulate the best penny stock companies at the best prices. We suggest using fundamental analysis to discover which are the best penny stock companies, while using technical analysis to pick the most opportune buying prices. More about that later.

The Nature Of Penny Stocks

Before we get into the nitty-gritty of how to pick the best penny stocks for the greatest return, let's do a quick review of what penny stocks are. First, they literally trade for pennies per share. While there are different ways to define what constitutes a penny stock, Penny Stock Insider uses a benchmark of any stock that trades for under the share price of $2.00.

If you're used to investing in large companies with stable blue chip stocks like IBM or Ford, then you'll need to remember that penny stocks are a much more speculative investment. You can expect these micro-caps, or juniors as they are sometimes called, to have greater price volatility.

The good news is, they can take off and become mid-cap stocks. When penny stocks multiply in values hundreds of times over, investors can reap huge benefits.

Of course, penny stocks can also lose value. You are more exposed to risk with penny stock than when buying bonds or blue-chips. However, that risk is off-set by the potential of making big gains. It's precisely this volatility and the high risk/reward factor that attracts investors into the penny stock market.

For example, many penny stocks are offered through resource or technology companies that are trying to raise money for exploration or product development programs. Some of those companies have large debt loads and may be losing more money than they're making. However, it's the potential of a major, or even a minor success along the way that often triggers dramatic increases in share price. This is where their value lies.

Profit Potential

For the newcomer, there is tremendous profit potential in that 5% of the penny stock market that we want to help you find.

Penny Stock Insider has the necessary expertise to uncover the best small cap investment opportunities in the penny stock market. And we know when to buy and sell. When you become a member of Penny Stock Insider you can take advantage of our experience by using our specific investment picks and latest hot stock reports to begin building your wealth.

There are several ways to profit from penny stock investments. We want to share with you just a few of the techniques we have found to be highly rewarding investment situations.

Promotional Stocks – Promoters can generate interest in certain stocks in order to drive up the share prices. However, the issues themselves may or may not have much actual value. The promoters generally own a large number of these shares. Naturally, the higher the price, the more they benefit. Eventually, they sell out and move on, leaving the original stock and investors behind. Without the work of the promoter, chances are the stock is going to come crashing down

In the early stages, it's as if the promoter is working for you, bumping up the share price while you go along for the ride. There is money to be made, but unless an investor knows how to recognize a promotional stock when they see one, they are putting themselves at risk for loss. The savvy investor can get in early, monitor the activities of the promoter and know when to get out. To make money on promotional stocks, you either have to spend time watching closely, or have someone you trust stay on top of things for you.

Technical Precursors – Often technical analysis can reveal patterns in the trading cycles of penny stocks that indicate excellent buying opportunities. For instance, when the underlying stock has a high probability for gain and only a low probability of decline, it might be time to buy.

In other situations, several positive technical indicators may combine and signal an outstanding investment opportunity. If you note the strong possibility of a sharp increase in price within a short time frame, it might be time to buy.

Fundamental Strength – What do we mean by fundamentals? They are the elements that constitute a company's financial strength or weakness, like earnings, debt load, assets, and so on.

It was long believed that it was earnings that drove share prices, but have since disproved this theory as it applies to penny stock companies. While earnings are important, there are more important factors to consider before making investment choices in this market.

Uncovering the best medium to long term investment opportunities requires an exhaustive analysis of company financial statements. Yes, traders should invest with the companies that are making the most money, but they should also have the most effective management, and have improving trends in all aspects of their operations. Industry comparisons and the examination of key financial ratios also will present clues as to which companies are destined for higher share prices.

When you do this kind of thorough homework on penny stock companies, you'll discover that there are only about two or three superior investment opportunities out of every 100 companies examined. That's not a lot to choose from after all your work, but you can make greater gains by investing with this hand full of top-notch companies than you ever could with a majority of the big named blue chip companies.

Undervalued Situations – When a company's share price drops dramatically, it's not necessarily an indication that their fundamentals are weak. Frequently it's just a reflection of overall market weakness, interest rate increases, or some other factor.

A good solid company with an unwarranted under-valued stock represents a real buying opportunity. If the price is temporarily low because of outside factors, a return to a more realistic stock price is inevitable and you reap the benefits.

Often a company has more cash on hand per share than their share price, or have price to earning ratios as low as 5.0.

Minimized Downside – After you've learned how to spot the undervalued stock opportunities, combine that with some good technical analysis. Chances are you'll be ready to identify penny stock companies with tremendous upside potential and low probability of any significant value declines.

These are the best choices for penny stock investors that tend to shy away from risk.

We hope this report has given you some useful tools and good insight into how to begin picking your own penny stocks. Penny Stock Insider is here to inform and guide you along the way. Become a member now and take full advantage of our experience.