Learn how to buy penny stock

One penny stock is a low-priced stock, mainly between $ 1 and $ 5. It is not traded on major market exchanges, such as the New York Stock Exchange, the National Association of Securities Dealers Automated Quotation System (NASDAQ) or the American Stock Exchange.

Although they are mainly sold for $ 1, but the stock may sell up to $ 10, depending on the promotion and advertising. They are usually available in small exchanges and off-market through the on-board notification board (OTCBB) and pink sheets

There are two main ways to buy a penny stock. These are online or through brokers.

Using Stock Brokers

Many stock buyers rely on agents or stock brokers to act on their behalf. They let them know how much stock they want, from which company, stock code and stock trading market. Some agents do not need any commissions. They make money based on the difference between the bid and the asking price. This difference is called propagation. The greater the spread, the more money the buyer and his agent have.