Cheap stocks are a coveted investment. Whether they are undervalued or just cheap in stock price they usually have a big upside potential that stock traders crave. The key is to find these cheap stocks before they are discovered by the major institutions. Once the institutions get a hold of them it's all over. They will buy up all the shares and turn penny stocks into big caps.

How to find hot cheap stocks is the challenge we are going to make easy in this article. There are great sites out there like Cheap Stocks that help you find the best investments. Using these sites will help you identify these low priced investments and identify what to buy.

Things You Will Need

Investment ideas
Cash to invest

Step 1

Use a Stock Research Website

Visit sites that have good stocks lists like Cheap Stocks to help you find lists of stocks that trade under $10 per share. You can use their list of stocks that sorts each company by the dollar their stock trades at. You can also look for investment ideas based on the industry of the company of by their best stock list which has list based on financial ratios like PE and dividend. Cheap dividend stocks are the gifts that keep on giving.

Step 2


Penny stock forums are where traders exchange tips and advice about stocks they are buying. Be careful of the forums though. Shady companies often put less than honest promotional information into these sites to pump up their stock before a big sell off.

Step 3

Research Each Stock

After you have identified low priced stocks you want to invest in go to Yahoo Finance and plug in the symbol for the company. Review the financial stats that you see there to evaluate the company as a whole. You can review their financial statements as well as financial news and data.

Step 4

Track Your Investment

After identifying companies to invest in and doing your research it is time to buy. After you buy you cannot just walk away from your investment. With cheap stocks you really want to pay attention each day to see how they are tracking. Wild swings can occur when the prices are low.

Step 5

Continue To Do Your Research

Investment homework is not a one time thing. You need to put in time each week to review the news and financial data for the company you have invested in. Keep your eye out for new stocks that meet your investment criteria.

Use penny stock websites, do your research, invest and track your progress. Enjoy the ride that only a cheap stock can provide.

Tips & Warnings