Penny stocks are definitely risks that are more closely suited for the financier that likes to go skydiving, skinny-dipping, and bungee jumping. Naturally even one or two more conservative investors will find some attraction in the low-risk promise of serious payments that the right low priced stock can offer. In reality many investors dream of being the one to find that perfect low-priced share with downright potential which will sometime become the following LDDS turned WorldCom before the fall. The truth is that tiny businesses become huge enterprises each day. Sadly, the ones that make it to the large leagues are quite few in number compared to those who don’t.

Penny stocks are a way for small corporations to finance expansion spurts, smooth over rough spots and come up with a way to become far better. This also gives firms an opportunity to restructure and by allowing their stocks to be traded as penny stocks they’re generating revenue that may be reinvested into the company to great effect. Many times, this is a successful venture for the company but there are many times it’s not. This is part of the danger that is taken when making an investment in penny stocks. When the corporations come up with a way to pull themselves together, grow at a phenomenal rate, and become the company you hope they can become the payouts are amazing. But don't expect instant results from your low priced stock investment.

You should also be conscious of the fact that many companies use penny stocks in order to run stings on trusting investors. It is almost impossible to get all of the particulars about low priced share firms when making an investment in penny stocks because unlike those companies that trade with the big boys (NYCE, NAZ, for example.) these corporations aren't required to open their books to potential speculators and do not face virtually the same amount of scrutiny that larger corporations face when opening their doors to investors.

But the issue of whether penny stock trading is for your is going to depend virtually totally on your personal sense of excitement and your eagerness to take risks with your cash. There are numerous out there who forcibly accept that so as to gain much, you must also be willing to risk much. This is a way of life for many that is true for them in love, life, and in money. These people are loads more capricious with their money and are prepared to take the chance without reservation or fear of a negative result. These are the folks that do wonderfully, win or loose when investing in penny stocks.

On the other end of the range there are those that enviously guard their nest eggs and bank their retirement security on the funds going in that basket. These are folk that are quite likely to find themselves panicking their way thru a penny stock investment for many reasons. You can’t truly research the corporations (a parody to folk who like careful planning) and you can't gain quick and easy access to your funds once invested. This removes some sense of control over you monetary health and is not a comfortable feeling for investors who like to feel in control. I will definitely relate to people who are in no condition, actually, to take a position in penny stocks. It is a frightening investment practice when houses, retirements, braces, and school educations are on the line.

If you are the type to speculate in penny stocks without carrying the heavy luggage of worry, stress, and scared sweats along with you then you might find yourself in the position to change your wealth status. Even if you go against your comfort level and make the investment there is much to gain. Unfortunately the risks of this type of investment are good as well and shouldn't be overlooked or put down. So it still comes down to you and the person you are way down inside. Is trading penny stocks suitable for you? Only you can answer that.

Steve Powerful reports on the most recent stock market trading tools and newsletters, writing on subjects like penny stock trading and well-liked guides like 2 Stock Trading.