Penny Stock Brokers. 

Buying and selling Penny Stocks is a lot different to trading ordinary stocks so unsurprisingly you need a different kind of broker. Some brokers are more geared to the penny stock dealer than others. One very small but highly significant point is how they calculate commission, because that could potentially cost you a fortune if you are buying hundreds of thousands of penny stocks. 

Top Penny Stock Brokers  

WILL NOT overcharge if you buy millions of stocks, should be the same price for 1000 shares as for 100,000, or 1,000,000 shares
Will execute your trades very quickly 

Ideally function online with no paperwork, and no minimum deposit. 

Before looking at a small list of Penny Stock Brokers that you might consider, we will just look at the downsides of trading in penny stocks, just in case you are unaware of the pitfalls. 

Number one Pitfall. Realise that most penny stocks are advertised by people called ‘stock promoters’ who are paid huge amounts of money to do just that. So if you are recommended a penny stock just realise that the person recommending it will be paid, so ask them how much, because the rules and laws they work under ensure they tell you.
You almost certainly won’t make any money with their tips, or with any of the subscription newsletters that come round, because most of the time the penny stocks they recommend are worthless. 

Take careful note that you can’t value a penny stock at 10 x earnings, or x times book value. There are no normal rules here, and a penny stock is worth whatever someone is prepared to pay for it. 

Also don’t get emotional or attached, you need to know when to buy and when to sell, make rules and stick to them. 

Finally you need the right Penny Stock Broker, so which Penny Stock Brokers will give you the best transaction rates, and a quick trade so if you have made a good decision you don’t miss the price rise you are hoping for 

Zecco
Zecco are now well established. They tick all the right boxes and they offer up to 10 free trades per month on accounts over $2,500. After that trades are a very reasonable $4.50 each. An advantage of this broker is there is no account minimum, so if you only have a small amount to risk, Zecco could be your best bet.  Zecco is unlike many brokers, you can sign up quickly without the need for a lot of paperwork. There are also no inactivity fees. 

Low Trades
Low trades is very much a discount broker. They offer the bare bones and low commissions as a result. Commissions start from a highly competitive $4.95 per trade, however they have a hefty inactivity fee of $50. You have to place trade at least bi-yearly to avoid the fees. However, if you are trading penny stocks, this is unlikely to be much of a problem. They also offer services like real time streaming quotes, but you have to pay extra for these. They also have no minimum account balance. 

Scottrade
Scottrade is another cheap broker, making it ideal for trading penny stocks. They charge $7 commission per trade plus on penny stocks they charge an additional 0.5% of the value of stock purchased. So if $500 of penny stocks were purchased, you would have to pay an additional $2.50 on top of the $7 per trade. Scottrade have a minimum account size of $500, but there are no inactivity fees. 

Sharebuilder.
Sharebuilder is a relatively new broker, and they have fairly low commissions at $9.95 per trade. Sharebuilder has no account minimums and no inactivity fees. 

Once you have signed up with a penny stock broker, you will probably be required to send proof of your identity in the form of a driving license, passport or utility etc.  

Once you have successfully opened your account you will need to fund it. Most penny stock brokers allow you to pay by credit card, debit card, bank transfer, paypal etc. 

Once your account is funded you can then begin your research and decide which stock(s) you would like to purchase. You need to practise, plan, and rehearse before you actually part with any money. 

It is often a good idea to monitor the penny stock for a while to try and get an indication of when it is oversold. 

Once you feel the stock is undervalued, you may feel it is a good time to buy it. Always have a solid exit strategy in mind so you don’t snatch a loss from the jaws of a win!!