General Investing
  -General information about
  getting started.
Stocks
  -How investing in the stock
  market works
Bonds
  -How bond investing works
Mutual Funds
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Economics
  -A basic intro to the economy
Advanced Investing Topics
  -This section covers topics
   like futures and options

Penny Stock - Definition
Below, you'll find a definition of this investing term...

Definition: The name given to a stock typically trading below $5/share. These stocks typically have low market caps, little liquidity, and are traded on OTC exchanges.

TeenAnalyst Advice: Penny stocks are risky for a number of reasons, including…

1.) Small changes in the stock price affect your return greatly.
2.) These stocks usually have less history for investors to go buy.
3.) These stocks usually have bigger spreads in the bid/ask prices so you don't always buy or sell the stock at the price you want.
4.) A little bit of news can send the stock swinging sharply in one direction.

 

Related Sections on Our Website

Investing - Learn more about investing basics and strategies.

Stocks - Learn about investing in the stock market.

 

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