IBlazedHeavily

the value of a penny stock depends on mainly a couple factors...

1. is how many shares exist? if a penny stock has 100 million shares. @ say 10 cents. that gives the company a market capitaliztion of 10,000,000 (market cap is amount of shares existing X current market value)

2. a penny stock typically trades at a value 5x the market cap, but of course depending on the situation of the company, as every company is in a different spot

for example i bought a penny stock called world water and power(WWAT) @ 70 cents. this company makes solar powered cells for huge power needs. right now the stock is sitting at 2 bucks. and its future looks promising.

when looking for penny stocks the best ones to go for are the ones who have cash on hand..the problem with penny stocks is that the company needs to raise $$$ so what they do is sell shares to private funds or investors in exchange for their cash..the holders end up sellin these shares further diluting the companies stock.. that is why u have so many penny stocks sitting under .01 cents..

i have 6 years experience in the stock market and trust me it is more complex than u think..there are so many variables and paperwork (sec forms) u need to understand and analyze. its a very stressful occupation..that is why i now just trade for fun, more of a hobby now

word of advice: if ur thinking of investing..brush up ur skills with paper trades (pretending to buy at whatever price, and selling at whatever price) see how u do, and once ur confident enough you can really start playing with some cash 8-)