Can You Make Money Shorting Penny Stocks?
Penny stocks are known to be risky investments. The old adage that the stock market generally grows doesn’t apply in the penny stock universe. Shorting stocks is betting a stock will fall instead of rise in price. What essentially happens is you sell a stock you don’t own for money, but you owe the stock back in the future. You simply wait for the stock price to fall and then you buy the stock and keep the difference. While you don’t want to short stocks that sit stagnant or slowly rise over time you can improve your odds with a few simple tactics.