How to Perform Due Diligence For Penny Stocks

Penny Stock Due Diligence

Penny Stocks are high-risk high-reward trading opportunities for new investors & are a great way to start trading if you have an account smaller than $50,000. That is as long as you perform your due diligence.

Due Diligence is the art of researching investments, and when it comes to performing due diligence for penny stocks it can get pretty complicated…unless you have a guide. Which is why in this article we’ll teach you a fast 3 step formula for starting your penny stock due diligence each and every time.

Step 1- Note Reasons The Stock Might Go higher

To start go to stock news websites like http://otcmarkets.com and start looking at the latest news releases. You’re going to want to set aside at least 1 hour for this activity, and you’re going to want to go back at least 3 months as you look through news articles.

In this first sweep you’re going to be looking for all of the forward looking statements that might help push the stock price higher if they are confirmed true. Forward looking statements that hint at things such as FDA approvals or company stock buybacks will help push the stock price up tremendously if found true.

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