Are These On Your List Of Penny Stocks In May?
Penny stocks are a different breed of equities. If you’re used to buying and holding large-cap stocks, you might have to shift your thinking a bit when it comes to small-cap stocks. But just because these cheap shares move up and down quickly, it doesn’t mean you can invest in penny stocks. It just means you have to be smart.
For instance, believing in “the hype” is one of the biggest risks for novice traders. Your goal is to make money with penny stocks, right? Well, if you look at penny stocks on Reddit, for example, you’ll see millions of users make one post about a certain stock gaining momentum. While that’s fine, you might see the same person post an emotional message a few days later after a penny stock jumps 50%.
Most people would take profit at this point, right? I mean you’re trading penny stocks, not looking for the next Apple in most cases. But FOMO, hype, and greed will have their ways with people not prepared to handle penny stocks and volatility. Why mention the “posts”? Simple, that person was originally interested in a stock making a percentage move. But then they turned into a “believer” even though their position was up 50%.
Penny Stocks: Don’t Let Emotions Dictate Your Account
This week I’ve seen a lot of traders throw out their playbook and turn toward “hope” for profits. One thing all writers on PennyStocks.com preach is do your research, understand what’s propelling penny stocks, take profit, and move on. Some traders may hold a small core position in case there’s a longer-term move. But in general, no one goes broke taking profit. Case in point, MicroVision Inc. (MVIS) was a great trade for 5, maybe 6 days depending on when people traded it. From April 29 to May 5 MVIS stock ran 614%. What was the hype?
Leading up to a corporate update on earnings, rumors spun about the potential for some relation to a larger sector leader (I’ll leave out the juicy, speculative details for obvious reasons). Most people would take profit after such a move. But many continued to believe the hype even after the penny stock plummeted from $1.82 to now below $0.70.
It was a similar story with Genius Brands (GNUS) after it rallied 212%. GNUS stock jumped after big news that mentioned Amazon and Alibaba. In the long-term, who knows what will happen. But short term, a position up 212% isn’t something to write off.
Will These Top Penny Stocks Reach New Highs In May?
My point is trade smart. Get your trading ideas, make a list of penny stocks, have a plan going into the trade, take profit. If you think there’s some long term potential then you might hold a small “core position”. Even if a stock continues higher, you have opportunities to buy more if the trend is strong.
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But at least you’ve taken the money and secured it in your account to trade penny stocks in the future. Tiered trading strategies and other styles of buying penny stocks to secure profit are discussed in our free ebook. So if you haven’t checked that out, feel free to do so. With all of this in mind, let’s take a look at some top penny stocks making a splash in May 2020.
Remark Holdings (MARK)
Market Cap: 59.74M
Price On May 1: $0.56
Remark Holdings Inc. (MARK Stock Report) has been on the move since late April. But this month has seen a bigger surge in trading volume. Initially, the company gained exposure after Creative Realities Inc. (CREX Stock Report) brought attention to the “reopening process” after things start getting “back to the new normal”. I’m talking about crowd control and preventative means to avoid another outbreak. Creative Realities had a tech solution for thermal imaging. So, as usual, investors looked for “sympathy plays” related to the sector. Remark Holdings was one of these and it just so happened to get its tech featured on CBS. (see: 3 Penny Stocks To Buy For Under $2 Right Now)
After that, however, MARK stock took on a life of its own. Things got even more interesting after a tweet showed an apparent email from Wynn Las Vegas to an unnamed recipient (name blacked out) saying the casino was partnering with Remark.
Many have since made calls to both companies including us. But there’s been no response and no official statements made as of May 8 at 11AM. Needless to say, Remark has done a re-markable job sharing tweets mentioning Wynn and even showing the company using its technology at what appears to be a ballroom-style setting.
More On Remark Holdings
- Penny Stocks To Watch: A Big Wynn For Remark Holdings?
- Looking For Top Penny Stocks to Buy Today? Check Out These Charts
Since the start of the month, MARK stock has climbed to highs of $1.15 and marked a total move of 105% since May 1st. What happens next could weigh more heavily on confirmation of what is really going on (if anything) between Wynn and Remark. Of course if we hear anything or if anyone reading has a tip, we will update as necessary.
Eros International (EROS)
Market Cap: 440.62M
Price On May 1: $2.50
Eros International (EROS Stock Report) has been one of the more frequently discussed penny stocks since last August actually. You can read more curated articles on EROS stock here. It’s also a perfect example of what I was talking about when it comes to penny stocks and making a profit. Since then, EROS stock was covered countless times as it managed to break out numerous times. The overall trend was bullish right through January of this year.
That was when EROS stock basically “reset”. The $4.91 high was the last thing traders saw before it pulled back to lows of $1.10. In that example, had someone held on for that entire time, there would have been zero gains to be had. But intermittent trading with a core or simply trading with the trend would see someone fare much better. Regardless of that, EROS stock has managed to trade higher in May and is now well-above its August 2019 levels again.
The penny stock started making a move this week after a big update. First, Eros announced an expansion of its existing partnership with Freecharge. It is one of India’s leading digital marketplaces for financial services and products. The partnership will allow Freecharge customers to experience Eros Now’s massive content library at a 35% discount to the annual subscription price. Then on May 7th, Eros followed up and announced a partnership with Visa (V Stock Report).
This partnership will offer Visa cardholders a discount of 50% on their annual subscription to Eros Now. They can also gain access to a large entertainment portfolio from the Eros Now library. This helped EROS stock remain in its multi-day uptrend reaching highs of $2.96 before the opening bell on May 7 and hitting $3.43 on the 8th.
Verastem Inc. (VSTM)
Market Cap: 306.11M
Price On May 1: $1.88
Unlike the two penny stocks mentioned above, Verastem Inc. (VSTM Stock Report) hasn’t had as explosive of a month (yet?). VSTM stock is another one of the penny stocks that has jumped, dipped, and repeated. Its most recent jaunt saw shares rally from around $0.85 in November to highs of $4.67 just a few weeks ago.
But the bad news did for the downside what good news does for the upside of penny stocks. Preliminary phase data and, more importantly, a prospectus to raise money via selling over 40 million shares struck a chord with investors; and not the good kind.
VSTM stock fell to lows of $1.63. Since then, the penny stock’s been in a tight channel below $2. This week the company announced its Q1 financial results for 2020 and that seems to have been a catalyst for a bit of positive sentiment in the market. “The early part of 2020 was marked most importantly by the strategic in-licensing of the novel RAF/MEK inhibitor VS-6766 which is being investigated in combination with defactinib, our lead FAK inhibitor, in KRAS mutant tumors,” commented Brian Stuglik , Chief Executive Officer of Verastem Oncology.
“The encouraging preliminary Phase 1 results from the investigator-initiated FRAME study recently reported at AACR in KRAS mutant low-grade serous ovarian cancer (LGSOC) will form the basis of our upcoming discussions with the U.S. Food and Drug Administration (FDA) and other regulatory authorities.”
Since this came after the close on May 7th, it makes sense to see shares trading more actively on the 8th. But the biggest question is will it be enough to kick things back into a bullish gear for VSTM stock in May?