If you are looking to buy penny stocks then read this article. This will help to understand what is penny stocks and which are the best penny stocks in India in 2022 to buy.
What are Penny Stocks
Penny stocks are very risky stocks for trading. Pricing of the penny stocks is in a very minimal range which attracts the traders more. There is no specific definition for penny stocks. But we can define them by their low pricing. Although we can identify them as low capitalization. In the Indian stock market scenario, the penny stocks are available within 20 to 30 RS. or more even 50 to 60 RS. As the penny stocks owe the low capitalization in stock markets, they are frequently traded and usually illiquid.
Penny stocks are highly volatile, but they also offer traders a very high margin of profit with a very high risk. Investors usually try to make a swing trading with penny stocks. To know what is swing trading go through this article- What is swing trading?
Key Features of Penny Stocks
1. Low Price In Markets
As we discussed, penny stocks are low in market price just because of their low capitalization in the market. Penny stocks are also categorized by price as some stocks are available under 1 rupee and some are also under 10 or even under 50. Before we mentioned that they are highly volatile , so their prices aren’t always kept low, their prices eventually go at higher levels also and brings a chance for the traders to make a profit in their portfolio.
2. Higher Possibility of Return
Penny stocks are always offering higher returns with a very short time in the market. Those investors who are looking for a higher return in a short time , investing in penny stocks are best for them. If you buy a penny stock at 1 RS with 10,000 units , then if it increases by 2 RS then your profit is 10,000 RS. It shows that you will get 100% of return, which is normal in penny stocks. People are also getting 500%, 600% returns.
3. Key Benefits of Penny Stocks
The most interesting benefit of penny stocks is that many small traders with less funds can get a higher return and make more money. Even in penny stocks investors make profit within a short time period.
4. High volatility of value
The bad part of penny stocks is the high volatility of pricing. Suppose you buy a stock at its all time high price after looking at its daily growth . But after your buy the price comes down at its lowest , then when it hits again it’s high and gives you profit that’s very unpredictable . Even it may not go to its higher price.
To know and predict the market movement read this article. How To Predict Bank Nifty Movement?
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Best Penny Stocks IN INDIA 2022
| SL.NO | COMPANY NAME | NSE SYMBOL | MARKETCAPITAL(cr) |
|---|---|---|---|
| 1 | ALOK INDUSTRIES LTD | ALOKINDS | 10,451 |
| 2 | BALAJI TELEFILMS | BALAJITELE | 401 |
| 3 | VODAFONE IDEA LTD | IDEA | 27,140 |
| 4 | HFCL | HFCL | 7991 |
| 5 | VISA STEEL LTD | VISASTEEL | 171 |
| 6 | BANK OF MAHARASHTRA LTD | MAHABANK | 10,735 |
| 7 | INDIAN OVERSEAS BANK | IOB | 33,079 |
| 8 | INDIAN RAILWAY FINANCE CORP LTD | IRFC | 26,071 |
| 9 | RELIANCE NAVAL and ENGINEERING LTD | RNAVAL-BZ | 217 |
| 10 | SOUTH INDIAN BANK LTD | SOUTHBANK | 1,674 |
These listed penny stocks are the best penny stocks in India in 2022 which gave a higher return in their recent performances. Many traders have gained a good profit from these penny stocks. But before investing in penny stocks you should always keep in mind that penny stocks are likely lucky draw tickets. The prices of these stocks can shoot up or down in a very short time of the positive or negative impact of the market.
To buy and trade in the stock market you need to open a Demat account through any online stock broker.
ADVICES BEFORE BUYING PENNY STOCKS
Before buying penny stocks keep some points in mind that the prices of the stocks are very volatile. So keep it very low in quantity and do not invest a huge capital in penny stocks. Do well research and find out the best penny stocks in India. The most important point is , never invest all your capital in a single penny stock. You can use your ¼ of your capital or invest in multiple stocks. Most of the investors are coveted in the short time with huge returns. Never get trapped in this situation.
Final Words
Though trade on penny stocks is very risky, you can earn a good profit from it if you go with the right strategy.
If you need any advice or have doubts you can reach out to us through mail: [email protected]
Thank You and wish you safe trading.
To trade in the stock market open a Demat account through an online discount broker. Open your account on India’s no 1 stock broker Zerodha.