WordValepenny stock
a very cheap, risky share
In more detail
1. (noun) a stock of a company that costs very little money per share, usually less than $5, and is considered a risky investment
2. (noun) shares in a small or new company that is not well-known or established
Examples
- He lost money investing in penny stocks because the companies were not stable.
- Penny stocks can offer big profits but they are very risky investments.
How to use penny stock
Penny stocks refer to shares trading at very low prices, typically under $5, issued by small, new, or financially struggling companies. The term is used primarily in financial contexts and carries a connotation of high risk and volatility. Investors use this term to describe speculative investments that offer potential for significant gains but are prone to manipulation and sudden losses.
Common phrases
- invest in penny stocks
- penny stock trading
- penny stock investor
- risky penny stocks
- penny stock market
- trade penny stocks
Synonyms
microcap stock · small-cap stock · low-priced stock · speculative stock
Opposites
blue-chip stock · large-cap stock
Word family
penny-stock (adjective) · penny-stocker (noun)
A common mistake
Learners sometimes assume 'penny stock' refers only to the literal price (a few cents), when it actually encompasses any stock under $5 and emphasizes the company's size and risk profile rather than absolute price alone.
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