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Seven rules for investing in penny stocks

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Despite the risks, small investors are putting big money in low-priced penny stocks

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They are lured by the fantastic returns that some stocks have delivered in the past few months

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If you also want to invest in this risky segment of the market

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keep a few rules in mind.

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1. Buy stocks with high volumes

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Some penny stocks are very thinly traded. For instance, the average daily volume of Titan Securities for the past 1 month has been only 3 shares

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So if you have 5,000 shares of the company, it will be quite difficult to offload them when you want to exit the stock.

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Buy stocks that have reasonably high trading volumes so that there is ample liquidity

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Don’t look only at one day’s trading but consider the monthly average.

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