What are penny stocks?

1. Penny stocks, as the name suggests, are the shares which are very cheap.
2. In the context of Indian Share Market, there are hundreds of shares having price less than 20 rupee per share.
3. There are shares having value of even less than a rupee.
4. Penny stocks are shares of companies having very low market capital; but because they are listed in stock exchange, people trade in them too.
5. These shares are usually risky and should not be traded.
6. But, sometimes when a company, which was not doing well in past years starts to perform well due to certain fundamental reasons, the value of such penny stock rises with an incredible pace.
7. One can visit the web site of National stock Exchange of India and search for securities less than 20/- rupees to have some outlook about penny stocks.