Buying Penny Stocks Without All The Work

Buying penny stocks, while it can be a lucrative form of investing, carries with it a considerable amount of risk. The risks of penny stock investing can be dramatically reduced by doing your homework on the stocks you are considering buying, but that homework is tedious and time-consuming.

A new computerized system has finally been devised that uses cold, hard, mathematical analysis to greatly reduce the risks and increase the profitability of buying penny stocks, while eliminating most of the work involved. As you might have guessed, this technology comes at a rather steep price, but some creative minds have come up with a way to make it accessible to the small investor while making the process of buying penny stocks simple and easy for even the newest of penny stock traders.

There are some big advantages to penny stock investing. The small price of each stock allows even very small investors to have diversified portfolios. Due to the fact that even a small dollar amount change in the price of the stock can have a major percentage change, it is possible to get much larger returns with penny stocks than with higher value stocks, and such returns can be made with small intial investments.

To show the power of penny stock price changes, let's do a comparison. If you wanted to invest $1000 and found a stock you decided to buy at $100 per share, if it increases by $1 per share, you'll have made $10. On the other hand, if you invested $1000 in a penny stock that initially sold at $1 per share and it increases by $1 per share, you'll make $1000!

Unfortunately, just as penny stock investing can provide very high profits very quickly, buying penny stocks can result in big losses quickly too. Besides the normal risks that occur just from normal market forces, penny stock investing is especially risky due to the relatively high rate of fraudulent practices by sellers of the stock. Corporations that issue penny stock are not required to submit financial statements to the SEC, so it can be hard to find good information that you can rely on when trying to evaluate the stock.

Penny stock is often sold using hard-sell and shady or outright fraudulent marketing ploys. As unsuspecting investors buy up over-hyped stocks and the stock price rises, the insiders wait until the price reaches its ceiling and then quickly sell off their shares. With the sell-off, the price per share plummets and the investor is left holding worthless stock that never had anything more going for it than a good sales pitch. Investments with potentially high returns over a short period of time do tend to be risky, but in penny stocks the relatively large amounts of fraud increase the risk way beyond what can be attributed to normal market forces.

Up until recently, it would take a huge amount of time and work to thoroughly evaluate penny stocks in order to keep away from the scams and to get a decent return on investment. Several hours of research might be needed to evaluate just a single stock. While this work would usually pay off in the long run, it was often simply too time-consuming for part time investors.

A couple of computer geeks who also had an in-depth understanding of penny stock investing have recently developed "Marl", which is a computerized bot that can evaluate hundreds of penny stocks in less time than it would take a human to evaluate just one. Unlike human stock-pickers, Marl is 100% cold and calculating - there's no emotion to cloud his judgement. Although even Marl doesn't have a perfect track record, he's a lot better than any human, and Marl can dramatically decrease the risks involved with penny stocks.

Marl has allowed some big investors to make many millions of dollars, and as such, Marl doesn't come cheaply. At $28,000 to purchase Marl, he's out of the question for most investors, but there is a way for investors with even the smallest of budgets to use Marl. Marl's human inventors put out a very affordable newsletter with Marl's top penny stock pick each week. In the case of those investors new to penny stocks, this could be preferable initially to owning Marl, as it limits their investment choices to just one stock per week as opposed to having to select from many options. This makes for easy stock investing for even the newest of "newbies" to penny stock investing.

Sadly, Marl's inventors are indicating that they will soon cease to offer the newsletter to new subscribers. Hopefully they will reconsider and continue to offer this valuable service that puts small investors on a more even playing field with large investors. For the time being anyway, Marl provides small investors with a great opportunity to profit from buying penny stocks.

Article Source: http://www.rightarticle.com

George Best is a part-time investor from San Antonio, Texas. For more about Marl and penny stock investing, visit buying penny stocks.

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