What are Penny Stocks?
Penny stocks are shares listed in nse bse that trade from a fraction of a penny to 20-30rs and having a small market cap. They are riskier as compared to large cap stocks, but give handsome profits in the long run. The long term profit given buy a penny stock varies form 10% to more than 200% or even more. Indeed, some penny stocks have gone from 0.50paise to 100rs+, while others have become worthless.
Large number of investors in India and other countries like penny stocks because it does not take a big cash amout to get started, and one can have a share in a good company that is likely to do well in the long run.
In the past penny stocks have had a bad name because of the lack of information of the company.
Nowadays, investors are quickly learning that penny stocks represent all the small companies across NSE and BSE, that are making good profits year on year and growing continuously. Moreover to nowdays investor avail the information about the profit and loss of any small company very easily.
The upside of penny stocks is the ability to turn a small investment into a fortune.
The downside is the risk, volatility of the shares, and the lack of corporate transparency.
Past Golden penny shares that turned into Large / Mid caps:
1. Ansal Housing listed on NSE BSE traded around 5rs in 2004 and it touched 450 in mid 2006. Upside seen is 8000% ++
2. Country club listed on BSE traded around 9.5rs in June 2005 and touched 1000 on 1st Jan 2008 Upsided seen is 11,000% ++
3. Subhash Projects listed on NSE BSE traded around 6.50rs in 2003 and touched 500 in Jan 2008 upside seen is 7590% ++
4. Prajay Engineers listed on NSE BSE traded around 3.4rs in August 2003 and touched 400 in Dec 31 2007 upside seen is 11,600% ++
5. D S Kulkarni listed on NSE BSE traded around 5.50rs in September 2003 and touched 400 in April 2006 upside seen is 7172% ++
6. Subhash Projects listed on NSE BSE traded around 8.20rs in July 2002 and touched 520 in Jan 2008 upside seen is 6241% ++
The profits of the above mentioned companies have almost doubled YoY. It is rightly said by “Warren Buffet - If a company does well the stock eventually follows”.
Here at NSEGUIDE we will present you with Small companies that have been posting good profits YoY, and we hope that they will give you good returns in the Long run.But one should always remember that these stocks involve risks. Hence we recommend you to read our Disclaimer before making any invesmtents in the stocks mentioned by NSEGUIDE.
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