Wednesday’s Word: Penny Stock

By Dylan Donley, Spring 2014 Graduate Research Assistant

A penny stock, while not necessary trading at one cent, is a common share of a small public company that is not traded on a major public exchange and is traded at a low price (generally less than five dollars a share). Penny stocks are listed on the Over the Counter Bulletin Board (OTCBB), which lists many equity securities that are not traded on a national exchange. While penny stocks are inexpensive to purchase, such stocks are often subject to substantial volatility in price and manipulation.

For more information about penny stocks, read more here and here.