"Penny stocks carry a good deal of risk. It's why the US SEC says, "Penny stocks may trade infrequently - which means that it may be difficult to sell penny stock shares once you have them. Because it may also be difficult to find quotations for penny stocks, they may be impossible to accurately price. Investors in penny stock[s] should be prepared for the possibility that they may lose their whole investment.""
"However, if you spot the right ones with solid catalysts, the returns can be explosive. Look at Advanced Micro Devices ( NASDAQ: AMD). Just a few years ago, AMD traded at around $5 a share. Today, thanks to the artificial intelligence boom, it's up to $160 a share for a return of more than 3,100% in just a few years. Of course, there was a lot of required patience, too."
Penny stocks present substantial liquidity and pricing risks and can result in complete loss of capital. Careful selection of penny stocks with meaningful catalysts can deliver outsized long-term gains, as exemplified by Advanced Micro Devices rising from about $5 to $160 per share during the artificial intelligence surge. Plus Therapeutics jumped after UnitedHealth agreed to provide national coverage for a CNSide cancer test, potentially expanding access to over 51 million Americans and reporting high sensitivity and specificity. Evaxion, a clinical-stage TechBio focused on AI immunology, experienced a significant volume-driven price increase.
Read at 24/7 Wall St.
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