Penny stocks often allure investors with the potential for substantial gains, but they come with a set of risks that are equally important to understand. These low-priced, small-cap stocks can seem like a doorway to quick profits, particularly for individuals looking to enter the stock market with limited capital. However, navigating this arena requires a keen understanding of both the risks and potential rewards involved.
Defining Penny Stocks
Typically, penny stocks trade for less than $5 per share and are not listed on prominent market exchanges like the NYSE or NASDAQ....