When discussing penny stocks that are listed on the NASDQ exchange, analysts differentiate between the type of penny stocks sold over the counter and off pink sheets and the penny stocks sold on the NASDQ. While the NASDQ penny stocks are riskier than traditional stocks, they are not as risky as the over counter version. Penny stocks listed on the NASDQ tend to trade at less than $3.00 a share. Many of the companies once tried on the big board, and are working their way back to more stable pricing. Some of these companies are new, and are challenged by the same liquidity, debt, and sales issues as the over the counter stocks.

The NASDQ tends to list penny stock because overall it is a very tech heavy exchange. Technology, biotechnology, and software companies may find a more receptive audience on the NASDQ. Additionally, it is cheaper for a company to list on the NASDDQ than on the New York Stock Exchange. This is important when a company is just starting out or is facing some profitability issues.

The NASDQ penny stocks represent companies with proven track records and a history of profits, sales, and success on the New York Stock Exchange, The NASDQ, or the American Stocks Exchange. These companies took a big hit during the recession, but analysts believe they are poised for growth in the near future.

Some of these stocks are ready for rapid growth. Back end technology start ups are a good example of valuable penny stocks listed on the NASDQ. While these companies will not be leading the way, they are important producers or manufacturers of the technology people rely on every day.

NASDQ penny stocks may follow or mirror larger market trends. If mainstream investors are bullish for one company or industry, penny stock investors may find value in similar companies. When you’re researching penny stocks on the NASDQ be sure to pay attention to larger market trends.

Identifying penny stocks listed on the NASDQ is less risky than purchasing penny stocks from pink sheets or over the counter. They may have amore substantial trading track record, as well as more available research. Regardless of where you find and purchase your penny stocks, you’ll want to conduct some independent research. When researching your penny stocks, you should be familiar with the company’s annual report, business plan, quarterly earnings reports and other information filed with the Security and Exchange Commission. Penny stocks filed on the NASDQ will be held to the same listing and filing standards as more traditional stocks.

Penny stocks are riskier and more volatile. Identifying and investing in penny stocks listed on the NASDQ can significantly reduce your risk. These companies have been more completely vetted by analysis and are subjected to stricter reporting standards. When investing in penny stocks, you should create a diverse portfolio, investing in a number of different companies and industries. While penny stock investing is risky, you can hedge some of these risks by investing in stocks listed on the NASDQ.

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