We strongly recommend that you read and understand the information below before making a purchase or sale of penny stocks:. Penny stocks are low-priced shares of small companies not traded on an exchange or quoted on NASDAQ. Prices often are not available.

Investors in penny stocks often are unable to sell stock back to the dealer that sold them the stock. Thus, penny stocks can be very risky. You may lose your entire investment. Investors should be cautious of newly issued penny stock. Do not make hurried investment decisions.

The prices and quotes you see online may not reflect the most current market conditions. This is due to the normally thin trading in these securities and is one reason market orders are not recommended for penny stock transactions.

Moreover, optionsXpress cannot guarantee the accuracy of any quotation information on our site for penny stock transactions. You can place penny stock trades on your own using optionsXpress online system. However, sometimes the information you need may not be available for some thinly traded stocks. You may find it easier to get a current quote or place an order through one of our brokers over the phone. To do so, please call Study the company issuing the stock.

Be wary of companies that have no operating history, few assets, or no defined business purpose. These may be sham or "shell" corporations. Read the prospectus for the company carefully before you invest. Some promoters fraudulently solicit investors to buy stock in sham companies, artificially trading options on penny stocks the stock prices, and then cash in their profits before public investors can sell their stock. Understand the risky nature of these stocks.

You should be aware that you may lose part or all of your investment. In some cases, the stock may fall quickly in value. New companies, events during the stock market crash of 1929 stock is sold in an "initial public offering," often are riskier investments. Securities and Exchange Commission, Fifth Street, N.

Content and tools are provided for educational and informational purposes only. Any stock, options, or futures symbols displayed are for illustrative purposes only and are not intended to portray a recommendation to buy or sell a particular security. Products and services intended for U. Online trading has inherent risk.

Penny Stocks Vs Options Which One Is Better?

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We strongly recommend that you read and understand the information below before making a purchase or sale of penny stocks: What is a "penny" stock? Generally, penny stock is a security that: Use caution when investing in Penny Stocks.

Important Information about Penny Stocks.