Penny stocks. Are they wise?

Are they a wise short term investment?
Lets say you have $1000 to play with and you buy some shares for a penny each. When it reaches 2 penny, you sell and then BAM %%% You are RICH!!!!!

Versus you buy something that is $10 dolar a share and dont' get much if it rises by a dollar.

My ex-wife took her Series Seven examinations to qualify as a stock broker for a penny-stock trading firm. It took her a while to figure out that she was joining what amounted to a long-running scam operation. The company was shut down within of year of her joining them, but not after she herself had fallen prey to the manipulations of some of her fellow brokers, using her own money. By then, we were no longer married, but I got a pretty good look at how the penny traders manipulate the market and rip clients off.

If you have done your due diligence and really believe in a company that you can buy as a penny stock, and if you're going to buy and hold, then you could possibly do well.

Also, it's possible to do well with an initial investment. At least at my ex's firm, they would get people to make an initial investment of a couple thousand dollars and then generate an impressive short-term gain. The next, bigger investment would go south. Or else they would mercilessly churn the accounts of clients, skimming off eight and ten percent of the client's money with every transaction into the next "hot deal."

Now, this particular firm was shut down. The SEC does catch up to the worst of the bad guys. However, this takes time...

If you want to turn that $1,000 into quick $2,000, a more reliable way would be to go into a casino and put all $1,000 on black. Your chances are a little worse than 50/50. But at least no one's going to skim fees and costs off your $2,000 if you do win.

they are wise but its not that simple you have to be able to lose to win CHA CHING

Penny Stocks are the last place to start investing in. It's typical for Newbies to do so. it's also typical that they lose a significant amount of their investments.

Consider yourself warned.

Penny stocks are not good investments. There is a reason that they sell for a pennies (actually, in most cases, less than $5 is a penny stock).

They are easily manipulated and when you want to get out, the volume is so low that you need to give a big discount to get it sold. In some cases, the cost of selling them is higher than what they're worth.

Most legitimate brokerage firms have rules prohibiting their brokers from recommending penny stocks to their clients.

Again, bad Idea. Invest there and you most likely have a 95% chance of losing everything.