Penny Stock Investments

Penny Stocks: Small Investment Equals Big Opportunities

Investing gurus will tell you that successful investing is the result of applying two fundamental principles:

1. Buying companies that are cheap; and
2. Buying companies that are about to undergo dynamic changes in their favor.

When you apply these two principles together, you’ll succeed as an investor. The trick is either to find companies that are out-of-favor with the market (and buy them just before they come back in favor), or to find companies that are overlooked and under-valued (and buy them before Wall Street notices they exist).

Either way, timing is crucial. And being able to utilize these basic principles successfully – and repeat your success – requires that you have access to more information than the usual stock market sources. Or that you have access to a reliable source that will gather and interpret the mountain of information that is available to the usual stock market sources.

So when it comes to big name companies on the major exchanges, such as Microsoft (Nasdaq: MSFT) or Google (Nasdaq: GOOG), you’re probably wasting your time. Big name companies are tracked by every trade magazine and media source, every professional and amateur investor, every market-watching blogger, every wannabe paper trader, and more. So, apart from the fact that the price of entry is dauntingly high with big name companies like these, it’s almost impossible to get any information that beats the market. 

However, you can pull it off when you can gain a timely informational advantage over the market.

That means you get information – fast – on a niche or a trend that the rest of the market hasn’t caught up to yet.

The good news about the present state of the markets is that there are more chances than ever before to take advantage of market oversights than ever before. That’s because stock market analysts losing their jobs.

According to the Wall Street Journal, between September and mid-May (during some of the worst troubles for Wall Street and the economy), FactSet Research reported there were more than 2,200 cases of analysts formally dropping coverage of a company. This represents a drop in coverage that affected about 25% of research reports.

And it wasn’t just small companies that the analysts dropped: Thomas Weisel Partners, for example, announced that they would no longer cover some big-names including Amazon.com (Nasdaq: AMZN), Bed Bath & Beyond (Nasdaq: BBBY), and Blue Nile (Nasdaq: NILE), among others.

Imagine, then… if even high-profile companies that usually get mountains of coverage are losing coverage… what’s happening to the small companies that had limited or no coverage to begin with?

Less coverage means less public information. However, less public information means a golden opportunity for you.

If you’re willing to seek out information sources and investment opportunities that few others have the time or resources to find, you can either get more information than the rest of the market, or better interpret the information before it’s available to the market.

At PennyPic, we believe that some of today's best opportunities exist in the companies whose stocks look pretty cheap today and should benefit over the next few years from a dynamic change in their favor. We’re talking about small to mid-size companies that Wall Street analysts typically overlook, especially now.

But discover these companies on the ground floor, and you’ve may have found a golden opportunity that few investors know about. That gives you a chance to follow the proven advice to buy cheap assets that are about to see a dynamic change in their favor.

That’s what we seek to do over and over again at PennyPic, our penny stock investing newsletter that’s devoted to studying investment opportunities in breaking penny stocks.

Here's the best part: You can follow along with all our research and notes - completely free of charge - by signing up for our PennyPic. All you have to do is enter your email address in the box below to let us know where to send them.