Penny stocks – any stock that is priced under $5 apiece – come as a popular option for traders, especially those who are limited by capital. Since it comes at a relatively lower price per share than, say, Apple or Tesla, traders can load up on a larger position size even with a smaller trading account. That being said, penny stocks are also notorious for being dangerously volatile. Here are three penny stocks that are worth considering.
EVs are currently a hot market, perhaps best exemplified by that of Tesla stock’s spectacular bullish run this year as well as the recent and long-awaited-for IPO of Nikola Motors. Another less known company that’s been in the space for quite some time now is Electra Meccanica Vehicles(SOLO). Currently recovering from its yearly first quarter lows, SOLO is up from $0.92 cents to around $2.50. Compared to Tesla’s all-time high of more than $2,000 a share, Electra Meccanica Vehicles $2.50 apiece is definitely a bargain. The company has plans to build its facilities in the US, which can help further bolster the demand for its vehicles and, consequently, the company’s share value.
With the pandemic forcing schools to switch to an online format, video conferencing companies, like Zoom, have seen their stock soar at unprecedented levels. One of the smaller commercial benefactors of this transition from physical- to remote-based learning is Zovio(ZVO). The company is currently moving around $4 per share, down $2 from its August high of $6. And with colleges and universities reopening, the demand for its products is only expected to go up.
Another market segment that has been positively impacted by the ongoing viral outbreak is the biotech industry. As the race to find and mass-produce a vaccine for COVID-19 continues, many investors are doubling down on biotech companies, one of which is Revive Therapeutics. RVVTF is currently working on an antirheumatic agent, Bucillamine, as a potential cure for COVID-19. If successful, it can help push the company’s stock, which is currently hovering at $0.19 a share.
Ultimately, good penny stock picks are not just based on how low the price per share is. You’ll want to find companies that are fiscally responsible and have no solvency issues, and provide a product/service that is actually valuable.