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Penny Stocks in the United States parlance stands for a common stock that trades at less than 5 dollars a share. These stocks are traded over the counter (OTC) using quotation services - OTC Bulletin Board (OTCBB) or Pink Sheets.

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In the U.S. financial markets, the term penny stock commonly refers to any stock trading outside one of the major exchanges (NYSE, NASDAQ or AMEX), and is often considered pejorative.

What stocks to buy is the question may pop into any stock trader's head. It is essential that they must know where they should put the trust and money into as investment is to make money after all. The traders are always careful when choosing stocks.