When you ask a friend or family member what their opinion of penny stocks is, you are likely to get a wide variety of responses. The first type of answer is basically apathetic towards the stock market in general, and even more so pertaining to penny stocks.

The second type of answer is that of misinformation. Something along the lines of “I think they are companies whose shares trade under ten cents”. Which actually isn’t incorrect but it is not entirely accurate.

Others may tell you a story about how they know a friend who lost their life savings by betting on a penny stock that went bankrupt. The flip side of that is that you may hear about someone who allegedly made a fortune by investing in penny stocks.

Regardless of how uninformed people view trading, it is wise for new investors to subscribe to a penny stock newsletter with a good reputation to help them navigate the choppy waters of penny stock trading. They can help shorten the learning curve and prevent many bad trades.