Restrictions on penny stock trades

So you are looking for the answer to where to buy penny stocks. Great! But there’s a really obvious problem you can run into after picking a brokerage company:

Your broker may have trade restrictions on penny stocks.

Some brokerage companies either do not have the ability to buy stocks considered penny stocks on their trading platforms.

Other companies will insist you must call to speak to a broker directly to buy a penny stock. In this particular case of calling a broker to buy penny stocks, they almost certainly will charge you higher fee rates than they have posted in their standard stock purchase fee rates.

And still other brokerage firms have limits on the dollar amount of the penny stock. Meaning they may only let you buy the penny stock if it has a value greater than $0.25 or similar. This could be devastating to you as penny stocks can fluctuate heavily in price, leaving you just out of reach of that penny stock you researched and want to invest in a timely fashion.

This also brings up the point of time frames on moving money in and out of their firm, and how quickly they purchase the penny stock for you. You may wish to do some internet searching research on any horror stories of the brokerage firm you wish to choose simply not transacting at times.

Also, if you so wish to do so, you may want to make sure the trading brokerage company allows for shorting on penny stocks. Perhaps you may never wish to do so. But knowing the brokerage company offers more services is a good sign you picked the right broker.

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Volume limits on penny stock trading