penny stock brokers

Penny Stock Fraud

Be careful because penny stock fraud is frequent and pervasive. I don’t mean to scare you away from penny stock trading, however you need to realize that many unscrupulous individuals are out there eager to exploit newbies in this field.

The SEC (Securities and Exchange Commission) estimates that penny stock fraud costs the economy billions of dollars every year. As stocks not on the NYSE or NASDAQ often do not need to fulfill the same standards to trade within Pink Sheets or the OTCBB, they can be much more susceptible to being manipulated and falsified online.

While some microcap fraud may occur on the NASDAQ Small Cap Market, a vast majority of stock fraud occurs in the OTC Market. So proceed with caution and always do your due diligence when trading penny stocks.

Penny Stock Quoting Systems

by Charles

While you can get your stock quotes online or in the paper if you want to be successful at trading penny stocks you will need to check stock prices more often then after the market bell at the end of the day. Instead you may want to look into penny stock quoting systems to provide you with more up-to-the-minute quotes and further capabilities.

There are a few different levels of quotes with different degrees of detail and other functionality. Level I stock quotes are similar to the information you get on the news, while Level III stock quotes include quotes on stocks as well as the ability to execute trades and send out a notice that trades were executed.

Since the price of penny stocks can change so quickly and so frequently throughout the day, the more information and capability you have with stock quoting systems the better chances of your success with penny stock trading. This is an already tricky market so all the tools you can find to help can make a big difference.

by Charles

One of the important aspects of any type of online stock trading involves finding the best online stock broker for your needs. Keep in mind you may not want to use the same brokerage account for long term investments and penny stock trading because they are two very different types of investments. Choosing the right broker can help you save money and maybe even make more money.

There are full service brokers, discount brokers and a little of everything in between. As the name suggests full service brokers provide more tools and services, but these tools and services usually come with higher account fees or trading costs. Discount brokers are cheaper in terms of fees but they don’t offer much in the way of help. There are also options in between, that offer a few services without high fees. It is important to evaluate everything from fees, minimum balances and services provided as they all add up to create a good or not so good overall trading experience.

This guide will discuss ten of the top online brokers from big names, like Charles Schwab and Fidelity to lesser known players like MB Trading and Scottrade, offering a summary of the services provided, account fees, account minimums and trade fees.

Buy Stocks Online

by Charles

One of the most common — if not the outright most common — questions I receive is, “How do I buy stocks on line? I think one of the most important ways to answer this is not with a direct answer but rather with a series of questions that helps the questioner understand the complexity and weight of that question.

In all likelihood, if someone is asking this question they are new to online investing. That can be a very precarious and vulnerable role to play these days, as these Internet waters are infested with fraud-perpetuating sharks. So come along with me as I examine what someone asking about how to buy stocks on line is really asking. Keep in mind the answer to this question can also vary based on what type of stocks you are considering, for example someone looking to get into online penny stock trading may use different tools than someone trying to diversify their retirement portfolio.