As one who thinks long term when it comes to investing, I naturally subscribe to buying low and selling high. That’s what I always aim for!

However let’s not forget that it is also possible that we can also profit as well when we buy high and sell higher.

Momentum trading works great in a bull trending market. Always good to have some quick cash in the pocket.

I agree you can make a killing in small caps, however the risk associated in penny stocks is relatively high and a lot of research is recommended. Find a mix of low and mid caps for diversification. I have invested in 2 mutual funds which are mainly into small caps and the returns are pretty good. The advantage here is that someone else does the research for me and the fund is diversified into a large number of small caps.

FOR example I would not invest in Nokia, a better idea would be to invest in companies that supply stuff to Nokia. Such companies have low overheads and therefore higher profits.

A good assortment of risky and stable investments is always a good approach. Diversification is the key mate.

Take care and cheers

Where a $10 stock might go up only 5%, a $1 stock can easily go up 20%. Of course, the $10 stock is more stable.

I guess a good assortment of risky and stable investments is a good play to take advantage of the positives that both have to offer.

I love your comments mate. Lets say you have 1000$ to invest so you buy 500 shares of a 1$ stock and 50 of a 10$ stock. The stock market goes up by 10%, the amount of profit you make on both stocks is the same{500 becomes 550 for the one dollar stock and the same for the 10$ stock}, 50$ each. Your 1000$ investment becomes 1100$.

Of course a $1 stock is considered a penny stock and the element of risk is higher.

Hope I was able to answer your concern.

Take care and Cheers.

A $10 stock won’t move as much as a $1 stock if they both take a ride up or down. And percentage-wise you can make a lot more with less capital on the small cap stocks.

Of course, small caps are also a lot riskier.