Penny stocks are a great way for investors to build a portfolio without spending much money. If you’re strategic, these stocks could lead to solid returns. Robinhood, one of the most popular platforms for buying penny stocks, is very intuitive and accessible for new investors, which has made it very popular among young people and investors on a budget.
Robinhood has a limited range of investment options when compared to more complex platforms. The platform does not support OTC stocks, but does support NASDAQ and NYSE securities. This means that there is still a huge variety of penny stocks to choose from.
When people refer to penny stocks, they’re typically talking about small companies with a stock price of less than $5. Below, we’re keeping it even lower with stocks under $1. Stocks with prices this low do come with specific risks that investors should be aware of. These stocks tend to be more volatile because they trade at low volumes. This means that one person buying or selling the stock has a much larger effect on the overall share price.
However, Robinhood only supports stocks on the major American exchanges. This means that there are more regulations and requirements that the companies must comply with, which slightly minimizes the risk. In this article, we’ll talk about the best penny stocks that you can buy on Robinhood.