There a lot of methods of investing your money. People are attracted to the stock market for the possibilities of making a lot of money quickly.While you can invest in a big company and watch your wallet grow over time, you can be a little riskier and invest in penny stocks for a much quicker gain.

There is a whole other monster that people don’t talk about much. Pink sheet penny stocks are stocks that are much less regulated and much more volatile.They are not technically apart of the major stock exchange and act much differently than your average stock does.

- What Are Pink Sheet Penny Stocks?

These stocks are very small. They can be defined as under $5.00 but most people think of under $1.00 when they thing of penny stocks. Some of them can be as low as $.05.

They are much less regulated and have a lower requirement for supplying information. These stocks are not part of the major stock exchange. They do not have the same requirements as others. It is very important that you monitor these stocks and do your research well.

There are risks and rewards to pink sheet penny stocks that you should be aware of before you think about putting money in them.

- Risks

These companies are so less regulated that information that is required of major stock exchange companies may not be available. A company may simply disappear into bankruptcy without much notice. That is why, especially in these types of investment, it is always important to diversify your money.

Diversifying your money puts you at a much smaller risk of losing a lot of your portfolio. I would not commit more than 10% – 15% of your portfolio in a single stock this size.

- Rewards

While you need to be careful and make well thought out decisions, there is a ton of money to be made in pink sheets. That $.05 share can quite easily and quickly become $.25. That would be an incredible 400% ROI in a very short amount of time!

If you compare this to long term investment plans in bigger companies, you can see how much money there really is in this. Becoming a good investor in these low price stocks is something that day traders dream of.

Click Here to See Our Favorite Market Research Tool!

- How to Start?

Take a small portion of your portfolio, lets say about 10%. Use that and only that and invest in a stock like this. Do your research and take your time. This will limit your risk and you never know, that 10% might be your biggest hitter!