Is It Safe To Buy Penny Stocks Now?

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Is It Safe To Buy Penny Stocks Now?

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With US stocks stabilizing, now may be a good time to buy penny stocks. – PowerPoint PPT presentation

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Title: Is It Safe To Buy Penny Stocks Now?


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Penny Stock Research
Is It Safe To Buy Penny Stocks Now?
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  • Welcome to Penny Stock Research. Every day we
    bring you the unbiased truth about Penny Stocks.
    For more information on penny stocks please visit
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  • Get Your Free Report On Penny Stocks For 2016!
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  • Hi, My name is Aaron and Im with Penny Stock
    Research, today were reviewing our recently
    published article

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  • Is It Safe To Buy Penny Stocks Now?

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  • Stock Investors are clearly happy that September
    is over. After the late August correction in US
    stocks, September really didnt offer much of a
    reprieve. However, October has been great so far
    for bulls.

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  • In fact, the SP 500 is up about 3.5 already
    this month. Even better, the Russell 2000 (a
    good proxy for small and micro cap stocks) is up
    just as much actually over 3.6.

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  • Thats a very good sign for penny stock investors
    looking to get back in the game.
  • Heres a quick look at what the Russell 2000 has
    done

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  • You can see the big rebound in the small cap
    index over the last week. The Russell 2000 is
    making a run at the 50-day moving average.

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  • If it can breakthrough, the index may be able to
    make a run at going positive for the year.
    Currently, its down about 4 in 2015.

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  • So is now the time to buy penny stocks?

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  • The question of course is, can penny stocks go
    positive as a group this year? Its clearly
    been a volatile last month or so. The
    uncertainty and selling has spooked penny stock
    investors who have moved on to higher ground
    (safer stocks).

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  • But, with the market stabilizing, theres a very
    good chance we could see interest return to penny
    stocks. Keep in mind, small and micro cap stocks
    tend to provide the most value over time.

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  • So, savvy investors will want to have this asset
    class in their portfolio. If volatility has
    settled down, then theres no reason to believe a
    buying surge in penny stocks isnt around the
    corner.
  • But has volatility settled down? Its only been
    a few days of stock gains. How do we know?

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  • Lets look at the factors.

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  • First off, the original spooking of the market
    back in August was primarily due to China and the
    emerging markets slowdown. Concern over demand
    from Chinas flailing economy suddenly became a
    concern for many investors.

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  • Ultimately though, investors seem to realize that
    theres only so much business the US has done
    with China. Its not nearly as much of a impact
    as many people assumed.

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  • As such, the main concern turned to when the Fed
    would raise interest rates. Primarily, the worry
    was the Fed would be too quick to raise rates.

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  • Obviously, market confidence has been more
    fragile than many assumed, as seen by how quickly
    we corrected in August. Given the concern over
    emerging markets, a rate hike at this time could
    be a serious blow to bulls.

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  • Fortunately, the Fed seemed to realize what was
    at stake and declined to raise rates in
    September. Nevertheless, Yellen and the FOMC
    did not give a lot of guidance as to when they
    planned to make the first hike.

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  • And, they appear intent on getting the first
    increase done in 2015. The market responded to
    the Feds uncertainty with more volatility of its
    own. But, volatility is like a wild fire
    eventually it runs out of fuel.

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  • On one hand, investors finally realized the
    selling has been overdone considering the
    variables in play. On the other hand, a few
    economic reports have come in worse than
    expected.

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  • That means the Fed will have even more pressure
    to not raise rates in October, and possibly even
    December. Whats more, a rate hike of the quarter
    point variety should mean very little to many
    penny stock companies

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  • at least the ones I would recommend buying.
    Considering I recommend shying away from small
    companies with a ton of debt, there really
    shouldnt be too much concern over rates.

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  • As such, now may be an excellent time to find
    great values in penny stocks. As always, be sure
    to do your research first before making any
    purchasing decisions.

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