Big Trading Tips For Small Stocks

Ready to jump on the small-cap bandwagon? This post is dedicated to teaching you how to pick small-cap stocks. I personally focus on penny stocks when I trade, but it’s good to know how to trade a variety of different size stocks especially when you are just getting started.

If you want to seek out the top small-cap stocks, you’ll need to sift through the many options that are available. To do that you’ll need to use a…

Small-Cap Stock Screener

A stock screener can be immensely helpful in this regard. Stock screeners can be used to filter by market cap to narrow down the choices. By cross-referencing the shortlist with other fundamental and technical indicators, (like we discussed yesterday) you can begin to narrow down a list of the top dividend stocks to consider.

Follow Stock Indicators

When you’ve determined a few small-cap stocks that you’re considering, let stock indicators be part of your continuing research. These are the things that can be the tie breakers that help you choose one stock versus another.

High Volume and News Catalysts

Look for high volume and news catalysts when seeking out opportunities with small-cap stocks.

Volume is super important. You want enough shares being traded on a daily basis so that you’ll find it easy to get in and out of a position. You don’t want to be stuck with shares that don’t move!

High volume plus a great news catalyst is a winning combo. If there is an event such as an earnings report, an exciting new hire, or something else that could affect the stock, and it has good volume, it may be a good time to consider making a trade.

Look for Clear and Easy Patterns

Why make things hard on yourself? Don’t make monitoring stock charts more complicated than it needs to be! Focus on the cleaneasily identifiable patterns.

If you’re reviewing charts for low-cap stocks and can see no discernible pattern…

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