Start trading penny stocks after you have 5-10 years of successful trading experiance in Large, Mid & Small cap stocks.
The key to successful penny stock trading is great money management skills. Since you didn’t address that as a question…. you certainly aren’t ready to trade penny stocks.

Many amatuers look at Penny Stocks as a place to start investing/trading. It’s actually the hardest areana to invest or trade in.

The stocks you want to focus on is consumer staples, consumer discretionary, and healthcare. These are DEFENSIVE stocks that will survive through good and bad times. Most of my positions are in these stocks. Some names include 3M, Procter & Gamble, Kimberly Clark, Exxon Mobil, Walmart, Costco. Everybody’s got to eat and wipe their ***** regardless of the state of economy. Many of these companies survived through the Great Depression.

That’s the benefits. You can sleep at night knowing your money is doing well. There are NO guarantees that you won’t lose money. It’s just that these stocks are the best. They pay good dividends too.

If you’re new to stocks, DON’T DAY TRADE. You’ll a rookie in a world of professionals. I tried day-trading with Citigroup and AIG when they were a little bit over $1. I had some luck at first, making about $30 a day but I was way over my head. My luck didn’t last long and I had to rethink my strategy.

Besides you can’t do much with $100 in the market. Day trading involves A LOT of commissions to the broker. With all the commissions deducted from each trade, you’ll be lucky if you only lose half your money.

I would just day trade using Yahoo! Finance. Open a stimulation account, give yourself $100 worth of fake money and play it in the stimulation format. You’ll see what I mean by losing money every easily.

Good luck.

If you mean to buy on brokers recommendations using advisory service, then I suggest using a penny stocks newsletter site, Doubling Stock site.
Click on the link below. I follow their newsletters and had some success.

If you are asking about OTCBB or Pink sheets then my suggestion would be to find a good charity and just give them your money. That is not a game for new traders.

My answer would be any broker that allows you to trade unlisted stocks. Call them and ask about volume restrictions, restrictions on individual issues, whether they allow electronic trades in unlisted stocks or require phone orders for them. Be sure to ask about per share fee’s. Another important piece of information would be to ask about their T-3 rules. Will they allow purchases with unsettled funds or not. Ask about their version of the pattern day trader rules as well.

For pink sheets:

For OTCBB:

You will need this one as well:

But there is tremendous risk, which is sometimes why they sell for so cheap.

I bought in on a mariculture company when I saw news that there are problems in the industry (diseased fish, pollution from the concentration of fish, um, wastes, etc.)–but my company had a method that was unaffected by those issues. The rest of the investing world was unimpressed that they had a solution, so it went no where. I got out without a loss on that one.

I bought in on a company that had a new rapid-fire technology for guns. I hoped that they would be bought out by the bigger military technology companies. They didn’t. The company was too small to make a difference on their own, and by then the military had steered them to non-lethal weapons development, and also by then our war had moved to police force work. I got out essentially with the same I went in with.

I bought in on a company with a then-novel approach to making vaccines. The technology is now called RNAi and is everywhere today. The company stock went from near a penny a share to over two-dollars a share. I sold out in stages, because just any day some bad news could come and I would lose all those gains. Last I heard, they still haven’t a product (good test reports, but nothing finalized and approved yet) and now the ‘big boys’ have their own close to ready. Like the weapons company, sometimes small fish are too small to be significant. The stock is still selling a little shy of a dollar but its prospects are not great.

Then, when the world was agog at voice over internet protocol services (VOIP) I bought in on a small VOIP company that sold to small and medium-sized businesses. Here I got stung by stock classes. All the value was in another class of stock. While I was on vacation, they sold the company business, without selling the stock, and I was left with a shell that had undergone a horrendous reverse split. Instead of tens of thousands of shares I had a few hundred. This shell was then bought by a tin mine in Nevada which changed the name and reverse-split again. On my brokerage ledger, my broker says it is worth six and a half cents today.

Another company had a better way to enhance MRI image slices than GE and the others, plus they were in the process of developing still a better program. Here again, the value was in a superclass and my common shares were literally common as dirt. So when GE announced their enhanced slices imaging, the good doctor essentially closed up shop.

Another company was touting extraordinary imaging and analysis for mineral prospecting. They did all this image analysis on Nevada and discovered, tada! That the area that had been the most productive in the past had so many elemental signatures strewn about from the mining waste that this worked-over land was the brightest blip on their radar, duh! My 111,000 is worth about $11 bucks

Then there was a company that I bought into, that similarly, figured that they knew where an even richer body of ore could be found than that which an existing mine was so successfully working. They staked claims for hundreds of miles of land. Meanwhile, a pump and dump promotional crew came in. I sold most out at a loss after the feeding frenzy and when it became clear that they weren’t going to actually dig anything, just hold a good place to dig. It reminds me of what Twain said, who was notorious for finding bad investments, “A gold mine is just a hole in the ground, surrounded by liars.” In my case, they didn’t even have a hole in the ground.

Still, for all these, and more, there were enough gains in what little I risked on them, that I haven’t lost much on my penny stock ventures. In another case, a big fish did indeed gobble up the little company, so I got stock in the bigger fish.

So it is like fishing. Sometimes you just lose worms. Sometimes you snag sunken trash. Sometimes, just sometimes, you hook a really good one. And that is why I try.

Recently, I made just over a thousand dollars as a short term gain on a pharmaceutical company with a marketable product already in production and able to be shipped. I would have made about three thousand if I’d held my million shares bought at $0.0007 as they topped out recently at about $0.0035 or so, but I sold them at $0.0018 because I got skittish when the trading volume reached a certain level on a particular day where they were going up in price rather rapidly. (I’d wanted to buy more shares at $0.0007, but nobody wanted to sell me more shares at that price.) I’d have no qualms about buying the same company’s stock again if it got to a reasonable level for me. I do think the company has a good future, but currently, the price on the stock is a bit high for my investment philosophy with the level of risk inherent in such a stock.

At the same time, I have lost big money with penny stocks too, but thats when I truly hadn’t done a good job of researching the companies I was investing in, one of which turned out to be quite a fraud scheme. As they say, “buyer beware”, and look out for yourself, because in the penny stock and sub-penny stock market, nobody else will.