How Much Do I Need To Get Started?
There are brokerages that allow you to start trading with as little as $1 as an initial deposit, and also allow you to buy fractional shares.
Whether or not a brokerage will allow you to use any portion of your available buying power to purchase a Penny Stock will depend on their own rules and requirements. You will need to check with them to be sure.
When starting small, you need to consider how much of a percentage of your trading costs are from commissions. Most online brokerages will charge a flat fee, and may have a scaled/tiered fee schedule based on how many shares you trade. But please consider how much you are spending on commissions when evaluating your costs/risks/rewards/returns.
Starting with a low balance is never bad! It tends to encourage discretion and caution, which are GOOD THINGS to employ/develop as you trade, regardless of what you’re trading. Focus on making good decisions, and not so much on the dollar amount of the results of those decisions. There are also many trading platforms that allow you to “paper trade” an account, where you can familiarize yourself with their interface and also test your strategies without risking any real capital.
As with many things, your temperament and discipline will play a big part of your development. If you’re not the patient type, then beware of the risks of being hasty with your ivestment decisions. Trading with a desparate mindset doesn’t just increase risk, it invites Ruin.
When starting small, it will also help to focus on percentages instead of dollar amounts, because the strategies you employ to grow your balances should be scalable with the amount you have available to commit. Sensible Money Management is a HUGE part of giving yourself the sustainability needed to endure downturns and bad streaks. Buying $1000 of a Penny Stock might not be worthwhile for an account that has $100MM, and buying $1000 of a Penny Stock in an account that only has $1000 available is just plain reckless. Somewhere between the extremes, a reasonable allocation may exist that keeps your risk tolerance, time horizon, and financial goals in consideration… But trading Penny Stocks is not a requirement and certainly not guaranteed to be a viable nor profitable way to execute your plan!!
GLHF!