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Politicians and the media often give the impression that stock market speculation is a "dirty word". The dictionary defines speculation as "an assumption of unusual business risk in hopes of obtaining commensorate gain".

The truth is that there is risk in all Stock Market investments. There are no guarantees. Some investments are riskier than others, but let's not assume that there are some sure-fire investments that provide guaranteed gain.

One area of speculation is "penny stocks". Penny stocks are stocks that sell for less than $5.00 per share. Some stocks truly cost mere pennies per share. Some investors like to buy penny stocks because some penny stocks will experience extra-ordinary increases in the stock price in relatively short periods of time. However, the risk in buying penny stocks is very high and many investors lose a great deal of money buying penny stocks.

Risk is not limited to penny stocks. Once again, speculation should not be treated as a dirty word. It is indicative of risk that all investors have to accept when they buy stocks at any price.

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11y ago
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11y ago

william lyon mackenzie king and r.b bennett

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