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Summary
- Investing and trading in penny stocks gives a fair idea about market dynamics.
- Since they are risky, trading in penny stock should be done only if you have dispensable cash.
- Among other things, such as stock performance and financials, it is important to pay special attention to the management of the company you are investing in.
Before delving into the investment part, it is very important to understand the concept of a penny stock.
The simplest way to define a penny stock would be a stock that trades below five dollars. There are, however, certain points that will help you to filter down your search:
- Companies that are typically smaller and the stocks of which are generally illiquid, that is, not easy to buy or sell.
- Though they may be working in core sectors in their region and probably doing well, they are often not covered by major analysts.
- Considered as risky; they usually trade over the counter.
Points to consider before investing in penny stocks
Penny stocks are often considered a good way to learn market dynamics, considering you have experimental cash lying for investment.
Among other things, such as stock performance and financials, it is important to pay special attention to the management of the company you are investing in, as a lot about future decisions depend on them.
With that said, let us take a brief look at five best penny stocks that you should be trading today.
Braille Energy Systems Inc (TSXV:BES)
First incorporated on May 24, 2011, as Mincom capital Inc, Braille Energy Systems Inc (BESI) is a market leader in the research, development and production of ultra-lightweight and high-performance lithium-ion batteries.
Braille Battery Inc. is based out of Sarasota in Florida. It has been pioneering complete line of lightweight high-powered battery systems for the transportation market.
Braille Energy stocks increased by 4900 per cent in the past one year. On March 1, BESI announced a supply agreement with Unplugged Performance Inc. for the supply of 12V lithium batteries. Following this announcement, the stock jumped nearly 33 per cent on March 2.
ESE Entertainment Inc. (TSXV:ESE)
Europe-based firm ESE Entertainment is on a mission to bridge the gap between Europe, Asia and North America.
Since its IPO on August 19, 2020, the stock price skyrocketed by about 766 per cent in the last seven months.
Digihost Technology Inc. (TSXV:DGHI)
Based out of Canada, DG host technology Inc. is a block chain technology company engaged in the mining operations of cryptocurrency.
The company is focused on mining Bitcoin and Dash using application specific integrated circuit (ASIC) mining rigs.
Digihost stocks yielded a return of about 876 per cent in the last one year.
Gratomic Inc. (TSXV:GRAT)
Engaged in exploration, Gratomic Inc is a junior metals and mining company operating primarily in Canada and Namibia.
Gratomic stock has given a return of 2920 per cent. It recently posted a surge after announcing its ‘debt free status’ on February 22.
GTEC Holdings Ltd. (TSXV:GTEC)
Headquartered in Kelowna, British Columbia, GTEC Holdings stocks climbed nearly 554 per cent over the past year.
The company saw its stocks steadily rise since launching its medical cannabis ecommerce website in February this year.
GTEC Holdings saw a revenue growth of 267 per cent year-over-year in fiscal 2020.
