The Best Online Brokers for Penny Stock Trading - NerdWallet
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The Best Online Brokers for Penny Stock Trading

What is a penny stock? The SEC defines a penny stock as a low-priced common stock: a stock trading below $5 a share.

Penny stocks are generally traded outside the major stock exchanges (such as the Nasdaq or the NYSE) and are traded on what is called the over-the-counter bulletin board (OTCBB) or through pink sheets, a daily publication that lists these stocks.

Both the OTCBB and pink sheets provide ways to trade stocks that do not meet the stringent listing requirements of the major exchanges. Of course, this also means that penny stocks are often far more volatile than stocks listed on the NYSE.

Overall, because of the high risk associated with penny stocks, NerdWallet does not recommend trading them unless you are a very sophisticated investor and have a clear strategy.

What to watch for when picking a penny stock broker

Trade commissions and fees: Because many penny stock trades involve a large number of shares, look for a broker that charges a flat commission. This will almost always save you money over the per-share surcharge levied by many brokers. TradeKing, for instance, tacks on an extra 1 cent per share for stocks valued under $2, in addition to their standard $4.95 commission. If you trade 500 shares of a stock, this will add $5 to your trade.  Be sure to ask about any additional fees before making a decision, and keep in mind that different brokers have different definitions of penny stock. Some consider anything trading under $5 to be a penny stock, while others put the cutoff at $3 or $1.

Volume restrictions: The best penny stock brokers will allow you to trade unlimited shares without additional fees, but a few charge more for large orders. Some brokers also limit the number of penny stock shares you can trade in one order or in one day, forcing you to pay another commission fee and slowing down your trading strategy.

Trading restrictions: Ideally, your penny stock broker will allow you to trade penny stocks with its online platform, just as you would a standard stock. Watch out for firms that require you to trade penny stocks through a broker, or impose limits on the types of trades you can execute. For example, many brokerages don’t allow customers to short penny stocks, and some don’t trade stocks valued under a certain amount, like 5 cents or 1 cent.


Best overall value in trading penny stocks

These brokers combine low pricing with quality execution, research and data tools.

  • Commission: $8.95 per trade
  • Account minimum: $0
  • Current promotion: Get a $150 Amazon gift card by making a qualifying deposit of $1,000 or more into a new optionsXpress account and placing 10 or more trades within the first 90 days.
  • Read our full optionsXpress review
Get started
  • Commission: $9.99 for fewer than 150 trades/quarter; $7.99 for 150 to 1,499 trades/quarter; $6.99 for 1,500+ trades/quarter
  • Account minimum: $500
  • Current promotion: Get 60 days of free trades on deposits of $10,000 or more, plus cash bonuses on deposits of $25,000 or more.
  • Read our full E-Trade Review
Get started

OptionsXpress and E-Trade share similar features, including a large penny stock selection, strong trading tools and flat commissions on penny stocks. Key differences: The OptionXpress  trade commission is lower, but E-Trade’s tiered pricing structure benefits high-volume traders. Both companies have exceptional customer service and helpful educational offerings.


Best for lowest-cost penny stock trades

For investors who prioritize low commissions over all else.


  • Commission: $6.95 per trade
  • Account minimum: $0
  • Current promotion: Get up to $600 cash when you invest in a new Merrill Edge account. Receive $100 for a $20,000 deposit, $150 for a $50,000 deposit, $250 for a $100,000 deposit and $600 for a deposit of $200,000 or more. Deposit must be made to new account with 45 days of opening.
  • Read our full Merrill Edge review
Get started
  • Commission: $5, plus $2 surcharge for penny stocks
  • Account minimum: $0
  • Read our full ChoiceTrade review
Get started

If price is your main concern, Merrill Edge and ChoiceTrade are good options. Merrill Edge has a $6.95 flat commission with no surcharge for penny stocks, though the brokerage has a limited selection and does not allow accounts that are composed entirely of penny stocks. ChoiceTrade adds a $2 penny stock surcharge to its standard $5 trade commission, but even that addition keeps its prices competitive. There are a few drawbacks here, too: The company imposes a volume surcharge of 1% of the trade value for trades over 500,000 shares, and doesn’t allow trades of stocks valued under 5 cents.

Best for beginner penny-stock traders

These brokers have educational resources and low minimum account balance requirements.


  • Commission: $9.99 per trade
  • Account minimum: $0
  • Current promotion: Open a new account with $3,000 or more and trade commission-free for 60 days, plus get a cash bonus on larger deposit amounts: $600 on $250,000+; $300 on $100,000 to $249,999; and $100 on $25,000 to $99,999.
  • Read our full TD Ameritrade review
Get started
  • Commission: $8.95 per trade
  • Account minimum: $0
  • Current promotion: Get a $150 Amazon gift card by making a qualifying deposit of $1,000 or more into a new optionsXpress account and placing 10 or more trades within the first 90 days.
  • Read our full optionsXpress review
Get started

TD Ameritrade and optionsXpress both offer flat commission structures with no hidden fees. They also have online education centers that will be useful to new traders, as well as $0 account minimum balance requirements. Aside from those similarities, they both have features that will appeal to beginner traders: OptionsXpress offers a lower commission and no extra fee for broker-assisted trades, as well as investing seminars at Charles Schwab branches (its parent company). TD Ameritrade’s trading platform is stronger and the company has more than 100 branches where investors can have questions answered in person.

Best platforms for trading penny stocks

These online brokers offer top-notch analytics tools.


  • Commission: $0.005 per share, plus exchange fees. Minimum $1 per order, maximum 0.5% of trade value.
  • Account minimum: $10,000
  • Read our full Interactive Brokers review 
Get started
  • Commission: $9.99 per trade
  • Account minimum: $0
  • Current promotion: Open a new account with $3,000 or more and trade commission-free for 60 days, plus get a cash bonus on larger deposit amounts: $600 on $250,000+; $300 on $100,000 to $249,999; and $100 on $25,000 to $99,999.
  • Read our full TD Ameritrade review
Get started

Interactive Brokers is a favorite among very active traders for good reason: Its Trader Workstation platform is streamlined but sophisticated, with everything traders need, including real-time monitoring, research, risk-assessment tools and paper trading accounts to test strategies. There are no limits on penny stock trades, though the brokerage passes along all exchange fees, which can add up quickly and make trading here pricey. TD Ameritrade gives its clients access to three trading platforms, including the award-winning thinkorswim.

Arielle O’Shea is a staff writer at NerdWallet, a personal finance website. Email: Twitter: @arioshea.

See our 2014 top picks here.

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  • top dawg

    I just spent a very long time writing a review of USAA providing important information that isn’t included here and when I clicked next, it erased my review and says I’m logged in. Can your system retrieve it?

  • Maxime Rieman

    I’m sorry, but we don’t have a way to retrieve your review if it wasn’t posted

    • J

      its my 1st time doing this now im trying to learn on which broker to pick online …let me say i don’t know much about stocks ..and learning if penny stocks or non penny stocks is the best way to go.. is there any advice for a beginner…?

      • Maxime Rieman

        I would suggest that you get started investing in non-penny stocks and mutual funds. Penny stocks are incredibly volatile and not suited for beginners.
        If you decide you want to try investing in penny stocks, here is some basic info that you should know before getting started investing in them:

        • vacuumation

          Not only that, but the rage for pennytrading has helped contribute to our economy crashing and its supposed ‘recovery’ coming at a snail’s pace. You know, the same weak economy that has put so many males on this comment section be underemployed, not afford the contemporary cost of living, and to descend into their parent’s basement. It’s also further discrediting the stock market today by allowing those who are essentially Hackers to find ways to game the system with technology and certain algorithms. None of this is spurring innovation or learning economics. This is certified betting.

  • Jeff

    This is the worst article I have ever read. Do not use a brokerage that charges you per share for Penny Stocks!!! Are you crazy? I buy Penny Stocks by the half million and if I take your advice I would be paying (.01X500,000=$50) Now why on earth would i want to pay that much to execute 1 trade when I can use E-Trade and pay a flat $9.95. You have no knowledge in stock trading or basic common sense when it comes to finances.

  • T

    I am a new investor of penny stocks. since we buy a higher volume why would I want to pay .01 per share. that makes no sense to me.

  • yahoo

    How great can they be? None of them list ULUR as a penny stock on the verge of exploding.Currently @ .52 a share, their ”ALTRAZEAL” should be a huge seller.Johnson and Johnson are you watching?

  • jin

    Penny Stocks:

    For stocks priced less than $2.00. Maximum commission per order not
    to exceed 5% of the trade value, with minimum commission of $4.95.

    – straight from the site, so it does not exceed 5% of the trade value

  • Jeffrey Snyder

    where is the best place to be if i want to buy one hundred shares at twenty dollars per share and the stock goes to thirty dollars per share and i want to sell it? i will have made $1,000 on my $2,000 investment for a total of $3,000 in holdings. How much will I get back when I sell the whole thing. How much did it cost me to get in and how much does it cost me to get out? Is there a monthly fee for them to just sit on my money. This is the kind of trading I would do to start off with by buying one to three or four stocks for a total of not over $6,000. Who is going to give me the best deal? I would move the cash limit up at some point in time.

  • Jeffrey Snyder

    Edward Jones fucked me by lying about what money they were charging and by saying when and how I would get my money. Words would not explain how angry I was. I wanted to destroy something. (them)

  • Michael OLeary

    I have a bunch of penny stocks that I bought years ago and they are finally taking off. They were restricted for a few years and we recently got them unrestricted. How do I go about selling some of them off.? What brokerage is good? Do I have to register these certificates again? As you can see, I am a complete novice at this. Help me out here.

  • Hari Iyer

    td ameritrade. that is all

  • Max

    I think this article needs to be updated. E-option doesn’t have option to trade penny stocks and Choice trade doesn’t allow socks under 5 cents.

  • jimladen

    altough etrade has a rep for being pricey, its probably on par with most sites. as far as i know, there is no extra fee for penny stocks. just the flat 9.99 commission, same as TD ameritrade. also etrade has a boat load of extra features and probably have a great customer service team as they are one of the most popular brokers out there. i’ve been content with them so far.

  • j

    what was the review about?

    • kofi

      i am new to penny stocks. registered with optionxpresss recently but i cant find where the penny stock is located on the optionxpress website.

  • Daniel Guzewich

    Where can I find a low cost day trade account. I am playing with penny stocks and tradeking says i need to have an account with 2500 in it in order to buy/sell same day 3 times a week. This is something Im playing with and dont want to put more than a couple hundred in the account.

  • Sam

    Choicetrade does not allow to buy stocks below 0.05 price

  • Alexia Merlo

    I am a new investor looking to open with three hundred and disperse into a few penny slots I’m looking for a cheap website with no or little minimum to open with? What site is the right one for me !!!?? I’ve looked for hours and changed my mind about a million times, can any one help?

  • Robert High

    Scottrade only charges $7.00 per trade if you trade online. They require only $500.00 to open up an account. It’s a great deal and a reasonable amount per trade.

  • Terrence

    I just signed up with a paper account with trademonster, and although I like their app and platform, there is one major problem for penny stocks. Most aren’t even listed.

    When looking to make a trade, none of the OTCBB/Pink are even listed to trade. Confused on why you recommend this broker for penny stocks when most aren’t even listed to trade. Am I doing something wrong?


  • BILL

    I trade penny stocks with Scottrade for $7

  • ldw

    My father and I invested in penny stock that were restricted and now should be unrestricted, we received an email from the transfer agent about 2 months ago saying they were no longer restricted. My dad is working with this guy and I don’t know if my parents just don’t understand what he is saying or if the guy is just BSing them. At any rates I am very frustrated, one minute they say that we should be good to sell the next minuted they don’t know if they can sell
    My question is once a restricted stock is unrestricted how long should it take to sell?

  • Jay

    TD Ameritrade unlimited trades for a flat monthly rate great for penny stocks!

  • Dan

    Hi Maxime,

    Thank you for the great review. I am looking to trade pennystocks and options on listed stocks too. I think Interactive Brokers covers me but right now the minimum deposit is just a bit too high. I was going to go with optionshouse as was recommended and has lower transaction costs but I don’t think they cover penny stocks and OTC? I have also been recommended Just2Trade and they seem to do options and OTC penny stocks. Do you have any views on either?


  • 11inchesofsnow

    I’ve used Etrade for over a year now and have had no extra commissions just flat fee of $9.99 per and they trade all penny and sub penny stocks down to .0001 I have built my portfolio from initial investment of $600 to over 40k in less than a year with same 6-8 stocks

  • 11inchesofsnow

    I’ll give you mine and you all can do some DD and check them out and hit me up with any questions or opinions
    EPAZ, LVGI, REDG, MYEC, MRIB, ERBB, KGET, QASP. I feel all of these are long term rides with over $5 potential LMK what you guys think

  • Tailgun

    One brokerage I’ve noticed as conspicuously absent from most online broker reviews is Place Trade Financial. They appear to basically be the little sister of Interactive Brokers – they actually use the IB platform and even employ IB as their clearing house! The only differences appear to be (slightly) higher fees, a lower minimum deposit ($5000) and more emphasis on customer service.

    Do you know if they offer penny stock benefits similar to IB?

  • Satish

    Get the details about top brokerage firms in India. How to trade with safer trading method in NSE, MCX, NCDEX, MCX-Sx & Also regarding Dmate account.

    Make a call us today +91 843 500 1551 / +91 8435001552

  • cnnmodscansuckit07

    USAA is absolutely terrible for trading.

  • kofi

    i am new to penny stocks. registered with optionxpresss recently but i cant find where the penny stock is located on the optionxpress website…

  • Medientstudios

    MDNT $$$$ to the moon! Form 4 reported CEO purchased 600k @ .064… Closed Friday @ .01- building the largest movie studio in the US. This is SO under the radar!! GLTA!

  • Marc Spenseur

    I am trying to learn how to trade penny stocks but I keep hearing how dangerous it is. I also read about Pump and dump from pennystockstraders. I’m wondering if it’s really possible to make money with all those issues.

  • Trader_Jake

    I’m surprised that you didn’t have a category/ section involving order routing. Big OTC and pink traders need to be concerned about the time it takes to execute, how orders are filled (MM or ECN), etc.. Can we ge an update?!

  • GWO9815


  • beth j

    This is good information. Reminds me of some of the tips I read on OTC Bully. They also provide great tips on penny stocks and stock trading.

  • Mila Rose

    Nice informative nice blog. Thank you so much for updating Forex Trade tips
    Best Online Brokers news. Recently I got more Profit form trading of Greenvaultfx – Trading company of New Zealand!!!!!

  • Mila Rose

    Nice informative nice blog. Thank you so much for updating Forex Trade tips news. Recently I got more Profit form trading of Greenvaultfx – Trading company of New Zealand!!!!!

  • Dean

    when they say Commission per trade is that for both buying and selling or would that be two trades??

  • Nick

    I’d like to start getting investing just a few hundred dollars of extra cash to start, with an eye on penny stocks. My priority is to keep trade fees/commissions to a minimum. Since I’m not bringing more than a few hundred dollars into play, my volume of shares will not be very high, so I could probably tolerate extra per share fees for penny stocks if the base commissions are low enough (like TradeKing level for example). I’m not sure what my trade frequency would be, but could be as high as a couple trades a week, or perhaps occasionally trades within the same day; I could also go weeks or months with inactivity as well. What type of broker would you recommend for me?

  • Bob

    I know this is probably a dumb question, but I am just a beginner. For the commission per trade part, say I only invest $5 in a trade, and I was using USAA, would I still have to pay the entire $8.95?

  • Chris

    This thread of comments is disturbing.. Diversifying penny stocks? Give me a break. If you want to learn how to grow a small account exponentially, I can point you in the right direction for some good free resources

  • trisia rutter

    Great info guys; I read through all posts first and a lot of my questions were answered. I am new and have always wanted to get into penny stocks to wet my beak. I know it’s not a get rich quick thing but it’s ideal for someone with limited money to invest, like me. Thanks again for all the great info!

  • LooseLeaf

    alright, so I have done some readings on stocks/stock-market for sometime now, and would want to start investing/buying stocks. I already have a list of (*diverse) companies on a stock market watch/portfolio I have with ‘seeking alpha app’ that I’ve read/watched/followed for sometime now. I’ve also read the entire comments section and must say, they’re very informative. I have a couple of questions to ask,…First, I’m just starting out, and looking to spend not more than $200. what is the best online broker(site) with the best deal that offer no commission fees, has no minimum $ requirement and has a relatively low pricing? I know of loyal3, tradekings and optionhouse. Any ideas to help a beginner out? Thanks for helping

  • LooseLeaf

    Hi Chris,

    alright, so I have done some readings on stocks/stock-market for sometime now, and would want to start investing/buying stocks. I already have a list of (*diverse) companies on a stock market watch/portfolio I have with ‘seeking alpha app’ that I’ve read/watched/followed for sometime now. I’ve also read the entire comments section and must say, they’re very informative. I have a couple of questions to ask,…First, I’m just starting out, and looking to spend not more than $200. what is the best online broker(site) with the best deal that offer no commission fees, has no minimum $ requirement and has a relatively low pricing? I know of loyal3, tradekings and optionhouse. Any ideas to help a beginner out? Thanks for helping

  • ben

    what direction might you be pointing

  • Al

    i am a complete stranger to trading and penny stocks, I’ve read some things and am still doing research, but how in simple words do you invest in penny stocks and get a broker? for someone who is a student without a lot of money! thanks

  • allenrodger

    Awesome informationI was wondering about the PDT rule and stressing’ out. Thank you..

  • chowdary

    guys i have some experience with trading i am a student who came to us for ms , but i don’t know what company is best for trading penny stocks in USA can anyone suggest a good broker with no hidden charges and less minimum charges thank u

  • Hiccup

    Theres a lot of great information here. Thank you for those actively contributing. I find it funny that everybody is trying to make the MOST amount of money with little money in hand… It doesn’t quite work like that. I’m a newbie, still in the research phase but some of you need a reality check. Do your homework first or you’re going to lose your investments.

  • W Peter Vos

    I want to trade international penny stocks, especially those found on TSX and Venture TSX. What I want is to buy real shares, not pinks or ADRs, but the real deal. I realize there are some extra charges, but lets keep those on the small size. I want fairly fast execution times too. All of this through an online platform. Great? But who is best? I can’t tell, too many loopholes, etc. THX

  • Dream Investor

    Does anyone know of a Brokerage house that trades stocks @ .00001

  • Jake Sillmin

    Are these relevant in the United Kingdom? I was looking at ETX or Plus500 after reading the comparison on, as they both seem focused towards British traders. The commissions on ChoiceTrade & Trademonster look more appealing… are they still reputable?

  • Larry

    I’ve been out of the market since the Big Bust of 2001 but always did well in IPO’s. So I want to get back to them. I signed with E-Trade but didn’t fund it when I found IPO’s are only available to accounts much larger than mine will be ($5K+-). What I’m looking for: Free level II platform, fast execution, low to moderate fees (nothing hidden) good research and absolutely no problem getting funds into or out of my account. Used to trade with Datek which was a great online broker. (Used to send me BIG chunk of chocolate when I made lots of trades!)

  • Pierre Torres

    I am a first time investor with around $500 to play with,which firm is best for me? I need one with a low commission rate, a big list of stocks, no minimum account requirements, and no hidden fees. Are there any that fit the bill? Or at least come close?

  • Lois Williams

    I have no idea about the penny stocks, that what they are but now I have read this article and I am really excited to read this about the online brokers and penny stock trading account. and thanks for the information about the companies with the penny stocks.

  • Jay

    How is Choice Trade for trading penny stocks?

  • Chet Bryant

    “However, the brokerage doesn’t allow customers to short stock” … so you can’t sell stock on OptionsXpress? So…uhm…help explain, anyone?

  • sania

    Really nice post as I found it to be very informative. Reliance Securities offers demat account which is Safe, Secure, Online & Seamless to keep track of your investments. Now trade online easily.

  • Guest

    blah, blah blah blah blah, lol

  • The_nature_fan_Wooooo

    which trading company do you all recommend for a beginner?

  • Am

    What about etrade? How good it is?

  • brett woods

    do any of these accept a paper certificate – OTC pink Current?

  • adan brown

    I haven’t had any experience working with the brokers. but still. this article seemed informative. i had been working with OTC US listed companies and I have earned huge profits. I would recommend to try out OTC:GLAG for safe and huge returns.

  • adan brown

    I only pick OTC US listed stocks. I have been trading in OTC:GLAG and I hav been earning huge profits. I would recommend all to try out GALA GLOBAL INC. for good returns.

  • tony

    Endocan or omnicare (ENDO) is on the verge of making a massive leap in price. Check it out

  • Adrain Sewat

    Me one of the new investor with regards to penny stock and looking out for investment into Gala Global Inc. Even though have read a lot about its working and venturing into different sphere, still would like to have some suggestions.

  • Agustin Notvali

    investment has always been a better solution for the individual, but one need to plan that where to move ahead. like which investments could be better like in Mutual fund, stocks, penny stocks and so on. You need to decide which stock could be beneficial as Gala global Inc is doing good but not sure about how it would make profit?

  • Thedukeofearlanddutchesspam Aw

    I am a new to all this. I have penny stock I bought in 2003 in USBU. I was looking to sell it. Do I need to open an account with a broker?

  • JayUty

    ANDY LANK CASH FLOW is still underground and unheard of in the Binary Trading world! I am anxious because I truly want you to be able to take the advantage of this if you really are a serious trader with the hope and determination to make millions from this platform. It’s quite possible. You just need a right trading tool like ANDY LANK CASH FLOW to trade for you.

  • courierearn

    I have personally used ANDY LANK CASH FLOW System before. A friend of mine he is also an expert trader. He suggested me Andy Lank System.

  • linnetobvious

    So, what you need is ANDY LANK CASH FLOW. It is the most amazing of all the software that I have come across.

  • Jason Angel

    I’m using ANDY LANK TOOLS and make nice profit since 4 weeks

  • Sean

    I’m new, still researching & learning. I have $2,000 ready to go & another $20,000 once I learn. I thought it might be best to take only $200 & trade it to a success point, say $1,000, just to help myself learn. My 2 questions are these: why is shorting important? Is that synonymous with selling? Also, with such a vast pool of opportunity, what are some recommended resources to narrow things down – ie, best choices? Thank you!

  • Matt Phillips

    The best online broker for trading penny stocks would be Etrade IMO. There are lots of risks involved with penny stocks.when it comes to finding penny stocks to buy an investors should be aware that these lower priced stocks can be incredibly volatile. You want to stick with the method of buy low sell high because the penny stocks can change at any moment. You want to make sure you buy in at a good entry level and exit at the right time to see the most off your investment before the possibility of not seeing a return on your investment. On the up side the gains can be uncapped many of these stocks jump 50-500% in a matter of hours.

  • n79c

    I need a broker that will do a dwac for at stock trading at .08 any help?

  • Earnest Matthews

    It the Penny Stock or Stocks Picks are same or some thing different?

  • Jamba

    MJMJ is poised to skyrocket. Not one for giving recommendations so I can avoid any blame if my research is wrong, but this is one worth looking into. Quality company, I have visited in person as I reside in Colorado. Rapid expansion is in their near future. I don’t recommend buying in for over 4 cents a share, but if you can get in under 3 cents it is a steal. This stock with hit at least a quarter a share come July. This post is solely to share a piece of knowledge with anyone looking for a ticker to research themselves. Do not take my word for it, but do not ignore this opportunity. Best of luck jumping on the train to anyone that does so before 5 cents!

  • SharjeelButt

    So it seems like if you’re not trading penny stocks – go with TradeKing.

    If you are trading (incl. shorting) penny stocks – go with CapitalOne/Etrade

  • SharjeelButt

    has anyone used optionshouse?

  • john

    good for you,but if no one knows how to purchase stocks then what good will your blog do

  • Guest

    nice article thanks! think i might give interactive brokers a look!

  • All American Debts

    Thanks for the info. I like Cobra Trading but that 30K minimum account funding is a bit much.

  • ezscott

    “At the price you specified, E*Trade can only accept orders placed with prices in minimum increments of $0.0001.”

    Why can’t I buy at 0.00001???????????????
    Others are.

  • Benny Thomas

    what company ( penny stocks) are you with now?

  • Redmastif

    I made the mistake of opening an account with TradeKing with the intent of trading mainly in penny stock. Since I really dont have a huge amount of money to start with I can’t trade in super low stocks because I can’t cover the $50+ commission charges.

  • Catherine Dye

    .01 penny per share is nothing. If you were to buy, for example, 5000 shares, that’s only $50. Geeze! You could spend that much on a dinner date. Don’t be such a penny pinch. Stockbrokers gotta earn a living, too. (SMH)

  • ucxhh

    See ANDY LANK CASH FLOW . I am using this product since 3 weeks and i am getting good profit.


    The only penny stocks making ACTUAL money are HOLL DCAC

  • Shane O’Neill

    If you don’t mind me asking what were penny stock you invested in years ago. And as a response to you question would say analyze how much return on investment you have already yielded in the past few years. Depending in your gain decide of you would like to keep rolling the dice depending on the performance of the specific company. And I would really try and find out what you have on your plate before immediately selling them off.

  • Maxime Rieman

    Hi Jeffrey,
    So you know, any stocks at $20/share wouldn’t be considered penny stocks.
    When you make a purchase and when you sell your position, you will be charged some commission (for example, at TradeKing it would be $4.95). In your example, it’s correct that you’d have made $1,000 minus the two commissions (so if the commissions were $4.95, your total profit would come to $990.10).
    Depending on the brokerage firm, you might have a monthly fee or not. TradeKing has no monthly fee, but if you don’t make any trades for a year or your balance falls below $2,500, there’s an annual $50 fee.
    If you’re just purchasing a few stocks, you’re not going to get a special commission deal, but the standard commissions at discount brokerage firms are quite low.

  • Tony

    Yeah trade king got me the same way. Now I’m looking for a new trading firm.

  • Rob

    Tradeking is great, that’s who I use for all my trading, except for penny stocks, they’re definitely not good for that at all. There are others with lower commissions but it was your fault for not researching before opening an account, not Tradeking’s.

  • john

    right on good advice

  • Maxime Rieman

    If you’re interested in day trading, I would start with Lightspeed Trading or Interactive Brokers.

  • anonymouse rex

    Avoid TD for penny trading…. I am, currently, undergoing an exhaustive, extremely frustrating and costly issue with them.

  • Maxime Rieman

    You’re right, but Choicetrade does offer some of the cheapest commissions available for penny stock trading.

  • Maxime Rieman

    Etrade doesn’t have extra fees for penny stock trading, however they do have a few limitations:
    No short selling allowed.
    Due to the potential volatility and differential in price, for your protection, market orders are not accepted on any stocks trading under $1 per share. Only limit orders are accepted for stocks trading below $1.

  • tekism

    Hmm what issue is that? I use them to trade penny stocks all the time. One flat rate

  • Boatcomputer

    You scottrade people better wake up
    Yes Ibought1000 shares for$7.00 then sold them a couple of days for a loss and a$34.95 fee.
    I m very turned off by them

  • 11inchesofsnow

    They will start charging you on top of the initial charge so watch out

  • Don Dikaio

    tekism typically when trading penny stocks your making trades often and quickly and chances are you’re shorting as well. TD Ameritrade while they platform is beautiful it’s slow compared to another platform that is flash based like option house. Also TD Ameritrade doesn’t allow you to short the stocks which I would think is most plays when doing penny stocks. Lastly TD Ameritrade follows the pattern day trader guidelines so essentially you can’t trade even after you sold because the money is held. This might not be an issue for some but the people that posted above are talking about small account which would leave them out of trading day in day out. I’m not recommending option house for penny’s either I just wanted to give you a comparison for platform performance.

    If you’re into penny stocks, check out sure trader, interactive brokers (10K min), and light speed (25K minimum).

  • nehpetS

    Trade king will not open a buy order for any stock that is less than $.01 per share. I did not know this until I tried to buy a stock at $/001 per share. In three weeks, it went to $.025 per share. I missed that run, and now looking to find a firm that will execute those orders. Also, Trade king will not execute a buy order on a stock with a 5 letter symbol when the last latter is “F”.

  • Art

    The best one to trade penny stock is “just2trade”

  • john

    good advice

  • john

    yes tony we need a good trading firm

  • This Guy

    This guy was absolutely correct. ULUR went form .52/ps to $1.52/ps today. I don’t know if you frequent this site but if you do I’d love to hear what stock(s) you think are next to GO!!!

  • helenabeat123

    Do you have any other recommendations on penny stocks?

  • Maxime Rieman

    I suggest you look at OptionsXpress and ChoiceTrade since they have no minimums

  • Alexia merlo

    Capital one which has

  • Maxime Rieman

    While ChoiceTrade does offer a limited selection, you’re not getting extra fees that many brokers add on

  • Maxime Rieman

    TD Ameritrade offers a flat commission per trade, not a flat monthly rate

  • GJThrive

    TD doesn’t allow you to short, which can be a problem.

  • Maxime Rieman

    Hi Dan,

    OptionsHouse offers penny stocks but the commissions are dependent on the size of the trades. This can get quite expensive for active traders.
    Regarding Just2Trade, they do offer penny stocks, but we suggest you exercise caution before opening an account with them. Last year, their parent company and its CEO were involved in a fraud investigation:

  • Dan

    Ah thanks for the heads up and the link, that’s very good to know!

    Considering I will be active in both penny stocks and options, do you have a recommendation? Obviously on paper it’s Interactive Brokers but the 10k min is a bit too much, was hoping for similar service but putting in about $2k instead. Anything you would lean to with those guidelines at all?

    Thanks again for your help


  • Maxime Rieman

    In that case, you might want to check out ChoiceTrade

  • iwillslapu22 .

    I use etrade commission they offer u 60 days free trading

  • jarran505

    Utrm is one of the next big stocks to pound upwards.

  • Maxime Rieman

    Keep in mind, you have to open a new account with at least $10k in order to get 60 days of free trades (maximum of 500 trades total).

  • iwillslapu22 .

    yes – that is true. Which brokerage is best for Shorting penny stock, Etrade is decent but you cant short stocks under $2 and you also have to paid a hard to borrow fee on some stocks. But in reference to stock under $2 or even $1 which one is best?

  • Maxime Rieman

    For shorting penny stocks, you’d probably want to check out USAA or Schwab. Schwab requires that you have a margin account in order to short, but that simply has a $2,000 minimum balance.

  • Guys

    Hey maybe we’re looking for a cheap broker here not a ” u got what u deserve”

  • nukestrom

    bull****. Tradeking has been criticized for changing their policy without letting investors know.

  • john

    it was worth doing because now we know. what we didn’t know before.

  • DNAmonster

    I’ve been told that most pennystocks are sold more than they’re bought. If he can get out with profit of even the lower margin, he should get going.

  • 11inchesofsnow

    I only pick companies that actually have a great product and tend to be sub penny but you can do some DD on these and make your decision they are long terms and IMO worth investing EPAZ LVGI REDG

  • brandon

    What stocks are you watching might i ask? thanks

  • Mel101

    ….. WOW! …BRAVO!… It is AS IF you bought an Acoyo alpaca … unproven (with a micron of 4 !!! much less than the wonderful magic number of below 20 micron… the “itch factor” ( definitely not above 30 microns !!! ) …. & … now… registered !! Now you can turn … or make more crias & sell them off for the next 15 years!!!! ( at a possible $40,000 to $100,000 !!! each when you show case them in Springfield, Mass in “The Big E” !!! All you need is to get an agriculture loan for “rural housing” …& house your future pet-like future crias at about 15 to 20 per acre & JUST agistment them… (= baby sit them like a cat …. they just eat plain hay… drink very little water & 3 sided shed ….they fend for themselves … nothing fancy… surrounded by an electric fence … ) …good luck! with your new found money!

  • alex

    Hi. mind me ask how u do it? you hold them for long like months or you do some trade days and cash out?

  • Chris Di Giamo

    I just signed up at optionsxpress, looking to deal with mainly penny stocks or sub penny. Should I have went with etrade, being that I just read this comment now I am second guessing myself. I still didn’t fund the account yet. Please respond ASAP. Thanks. Oh and I am only looking to start with $500-$1000 and test the waters. Also thinking of day trading. Please help. Thanks again.

  • mr. E Man

    Obviously he’s lying if he said he’s been ising etrade for over a year and went from 600 to 40k in under a year. The time frames don’t add up

  • LenM

    I was blocked from attempting to purchase penny stocks on *Etrade…I wouldn’t advise anyone using them…

  • novicester

    Please check again, anything under $1.00 is based on percentage.
    Now I’m looking to change to TD who charges flat rate for all.

  • StockboyMonster

    I agree these are for long terms but not bad for flipping. I am long term on QASP, ERBB, MRIB and LVGI.

    Guys Check DGRI, PMRS, MCIG, MINE, CBIS and KNDI.

  • rg

    hi 11 inches,
    may I ask you if you hold the stock overnight or if you do the swing intraday trading?

  • bob

    mind if i pick your brain about trading? nothing extensive, just looking to get started on the basis.. could use some pointers.. insolentminxers at g. thanks dude

  • bunners54

    Hi.i am new to this.but i have looked at many things.but you seem to be very interesting in your success of what you do with Penny stocks.could you advise me on this please.i can give you email also if so wish?thanks again Graham.

  • john


  • Maxime Rieman

    Unlike Interactive Brokers, PlaceTrade only has a limited selection of penny stocks available, and they charge an additional $0.01 per share (up to 1% of principal value).

  • Tailgun

    Thanks for the reply, Maxime. That’s very disappointing to hear; I’d been hoping Place was a viable alternative for me as I do not have the 10K required for an IB account.

    Looks like if I want to short penny stocks the only game(s) in town are IB and SureTrader.

  • Maxime Rieman

    Actually, as we mention above, both Schwab and USAA allow you to short penny stocks. In addition, TradeStation is updating its platform to allow you to trade (and short) penny stocks without going through a broker.

  • Tailgun

    Wow, that last part is news to me. I opened a Tradestation account about a month ago and have not been thrilled with the clunky platform and its steep learning curve.

    In fact, what precipitated my search for a new broker and finding this article was my attempt earlier this week to buy a penny stock only to discover it would not execute. A subsequent phone call to support informed me of the current incapability of Tradestation to place penny stock trades from the platform!

    Do you know when they are planning to upgrade? Is there any link to information you could pass my way?

  • Maxime Rieman

    We don’t have further details right now, this was from speaking with a Tradestation representative.

  • jarran505

    TD is a pain because I hate paying $10 a trade. Also when you deposit money into your account you cant use it for 4-5 days.

  • Maxime Rieman

    It is quite risky to trade penny stocks. You should always do your own research on any stock before investing and not simply trust a recommendation. A few people have made money trading penny stocks, but if you’re looking to make money long term, penny stocks are much riskier than diversified mutual funds or simply listed stocks. You shouldn’t actively trade penny stocks with money you can’t afford to lose.

  • JOHN330

    Some people take advantage of the traditional pump and dump scams. For instance, the direction of a stock can be determined when the hype increases and momentum is noticed (of course you need to have an eagles eye on the penny stock) and profit with the proper exit strategy.

  • m

    I’ll add HFCO to the list which is trading under a penny currently. They now have patents to advanced fuel cells and funding to begin production soon. Definitely one to keep a eye on over the next few months/years.

  • sj

    which trading company u will be a gr8 help ..i have also checked light speed and loyal 3 and I’m so confused ..just one name which has best options and no/low fees or the one that u r trading ..thqqq so much

  • John-Smith

    ALL 3 of these penny stocks he mentioned are now $0.00.

  • Franklin Jr

    Sounds like you’ve found some good companies. I’m recently disabled living in chronic pain. Could use any advice, in need of $$. Of course I’ll do my DD, any tickers u could share? By the way, good for you!! That kind of money can change a mans life. PEACE, Frank

  • mikem

    I think he mentioned some of his favorites above.

    Making that much with $600 in less than a year is pretty inspiring…Good job!

  • patterns

    Just checked DGRI (looks like its about to happen) and the rest look great on your short list as well. SBM, if you see this, can you recommend a source for these picks?

    @11inchesofsnow:disqus , those you listed peaked a while ago and dont seem much worth anything now, i missing something? Or are you saying thats where you made the gains you were talking about?
    All the best fellas!

  • Maxime Rieman

    The commission per trade is charged both when you buy and sell a stock.

  • Maxime Rieman

    Besides TradeKing, you might want to try TradeMonster. They charge a low base rate with a very small fee per share.

  • Maxime Rieman

    You always have to pay the entire commission per trade. For USAA, this is $8.95 plus a penny per share on trades over 1,000 shares. They have a discount if you make over 25 trades in a rolling 90 day period or have at least $50,000 in assets in your account. In that case, the base commission is just $5.95 per trade.

  • Maxime Rieman

    I’m glad we could help you get started. Feel free to send us a message if you have any further questions.

  • Maxime Rieman

    The first step would be signing up for a broker, and you’d probably be looking for one with no account minimum. Once you’ve signed up, researching companies is a large portion of trading. Many of the brokers listed above provide research and analytic programs. In addition, many investors like to read what others are doing through sites like Seeking Alpha. Just be wary of anything that sounds too good to be true, or pump-and-dump schemes.

  • Mel101

    …oops Mel101 from Kent,Ct.

  • 11inchesofsnow

    Silly silly smh

  • Mel101

    Mel101 from Kent,Ct. …I came home one day …& my dog didn’t come to the door… I was calling it’s name over & over …. it still did NOT come… then I found my dog just sitting in it’s usual place by it’s dinner bowl… & I said sternly & repeated it’s name…@#%$^!!!!! I said … come here… when I call you! I said… then it still would NOT come to my feet! Then I ignored it the poor thing! Then I went about my business etc… got my mail … ate something etc…. NOTING … still my dog sitting by his food bowl …. then I looked at my phone messages… it was flashing a RED LIGHT with … “10 messages” & the phone number from the SAME stock trade firm’s phone number I recognized 10 TIMES I was wondering why they would call so much…. then I HIT PLAY MESSAGES … it played , ” Margin call ” OVER & OVER … on the first time …MY DOG CAME ENTHUSIASTICALLY to my feet!… Now his new name is “Margin Call “!!!! …I made this joke up for Jeffrey Snyder & all others…. good luck everybody!

  • Paulo

    Several years ago I used USAA for big board stocks. Their platform was awful for research, so I researched elsewhere and only traded there.

  • John-Smith

    Sorry but, you’re not going to do shit with $200.

  • Bernice Vaughns


  • vacuumation

    They’re all bankrupt companies on the verge of being removed from exchanges. Why would anyone waste their money in such stocks?

  • 11inchesofsnow

    That was the point they already peaked and I made over 10k in just those alone most people that are scared to take advice are people that sit around and tell other people how much of a dumb idea it is to take advice from people that have experience

  • Penny Stocks Traders

    It is a must that you do your research if you do not intend to lose your money. Oftentimes, we tend to trade penny stocks that are very low in price thinking that they will shoot up sooner or later, but unfortunately it usually goes toward the opposite directions. Learning about the company is very important. I will write a blog on this topic, keep an eye on it.

  • saki4912

    hit me up on twitter. I can answer any of your questions. @saki4912
    Twitter is a great place to follow penny stocks as well!

  • Nando

    Penny stocks are trashes so you should not hold them long. you need to lock the profit as soon as possible so you won’t risk your money.

  • 11inchesofsnow


  • Pseudotix

    It all depends upon clarity, discipline you have. Something like LVGI went from highs to .0001 and then to .026 something (if I remember correctly – you can look at chart) I had 1M shares at .0001 that I flipped at .0002 so missed all that scale up. If I had clarity that it will go as high as 260 times and discipline to bear the emotions of highs and lows (greed and fear) i would have timed it perfectly and made 26K out of $100 within 2 months. Lot goes into this and it’s easier said than done.

  • saki4912

    $10 to trade is not much at all. If you’re worried about a $10 charge, you should not be trading stocks.

    Also, if you wire the money to TDAmeritrade, it is available in just a few hours. They also have a debit card feature where you can access your money at any time. Yeah, that means you can withdraw CASH anytime!

    If anybody has questions, hit me up on twitter @saki4912

  • vacuumation

    Good for them. Most of these n00bs trying to trade penny stocks have no idea about the stock market or finance. They think they’re playing Fantasy Football or something. Half of the commentators here seem to fit that bill.

  • vacuumation

    You guys at NerdWallet should really list those details about TradeKing’s hidden fees in the overviews. It’s very misleading to see in the box that there is no Account Minimum (to open?), but then you state here that there is a bunch of other potential fees related to maintaining a certain amount in the account.

  • Maxime Rieman

    You can only short stocks that are at least $5 through OptionsXpress.

  • 11inchesofsnow

    Smh no lies here it’s not time that makes you money it’s the amount you invest and the amount the stock rises when you buy in @.0001 each uptick is faster profit than a stock that is at say .22 it’s simple math ; ) for being a doubter I’ll give you a long term penny stock to get into for long term

  • 11inchesofsnow

    SMH stop being negative read comments and don’t deter others from good advice these companies are not going bankrupt But they did peak and I made my money and moved on MYEC and EPAZ are the long term holds those were short term at the time

  • John

    are you stupid you can still make money off penny stocks your the stupid one if you don’t know how it works

  • John

    no there not going bankrupt you moron

  • John

    Ford was on the penny stock in 2011 =_=

  • 11inchesofsnow

    I don’t really know much of your company but i know etrade is straight forward and simple on pricing and they trade in sub penny stock I have had no complaints and they are well established company

  • 11inchesofsnow

    Yes they peaked already but MYEC EPAZZ and DIDG are long term holds buy and sit on them they are working on building up the revenue in these companies so right now they are not moving much but all are looking to get out of Pink market do your DD especially on MYEC

  • francis Loan

    Hey Ma, Ma come quick – bring your pencil ‘n a piece of paper ya gotta hear this New fangled way of doin’ business gotta writ it down Ma quick… Think were all finished up now Ma people aren’t buyin’ now Ma… things changin at the General store Ma whole economy changin’! What are we gonna do with the garden and the still now MA?

    More sold than bought … hmmmmmm…. Hey Stan, Larry, Curly, Moe, … this here fellas saying people are sellin more than’s being bought… How’s that done? Yo, Whimpy bro, you running business in reverse now too Dude? First the bro wants me to ‘sell’ you a burger notsa get paid till tuesday nowsa ya figured out how I can sell my burgers without no hungry customers…. Yo man whatya doin’ …


    That is one of the most ridiculous, illogical and actually unbelievably stupid – TOTALLY! pieces of ‘insight’ I have EVER heard offered by anyone from a child to a centurion… WOW… Consider this question – just for laughs… What does the economic term “sell” mean? Now. hang on DNAmonster – What does the economic term “bought/buy” mean? One more ‘synapse’ connection to jump here – In economic terms what is the implication of both of those economic terms/actions imply… Require… MANDATE?!?!!

    Just in case there ol’ DNAmonster has a serious buildup of plaque in his brain or his ‘brain’s’ electrical aspects have shorted out or he has brown out in progress… DNA – to sell there must, MUST be a Buyer! To be bought/buy there must be a seller… Does that make any sense to you…? Oh, wait, unless of course one is adding to the equation the tooth faire or Santa Claus as the second side of the economic exchange…

    Hey lad, do you mind revealing where and the years you attended school? Did you pay attention? Have you ever worked for anyone? Who handles your finances – out of curiosity how do you get along in life? Are you the original bubble boy?

    I would love to meet the person who passed that wisdom on to you… Do you get a lot of advice from this person? Does he/she work in Washington? A Liberal or Socialist per chance?
    Are you guys playing Fantasy Trading Again?….
    Try starting with Monopoly first will ya guys…
    Oh, yeah, I suggest you refrain from giving financial advice to anyone but your wife or girlfriend – doing that with this sort of advice will get you smartened up, black and blued real fast OR very lonely Real fast…

    As for the holder of the older penny stocks… As the other person, wise WISE person suggested do your research before you sell… this may be a hold! Check into things like very special circumstances such as special US gover War bonds that were worth a fortune not the face value because these ‘bonds’ never really matured they kept and still recieve interest paid…. little known OR early stock certificates for company’s like AT&T and other companies that date back to the early part of the 20th century… what at face value is seemingly small has often been proven worth thousands of times more…
    beware the Ides of March… even good friends advice can be hazardous even fatal!

  • Pennyman

    .01 per share commission on a stock trading at .0002 a share is insane tho. We’re talking about large volume trades of micro value stocks. What site is best for that?

  • Latiesha Butts

    I am researching stock; I am fairly new to stock exchange, but I am not afraid to invest. Can you be of any assistance in suggesting the best stock & company to invest in?

  • Ivory

    HI what advice can you give me to get started in the penny stock trade. I would really appreciate it . Thank you.

  • John

    my friend made money off of a company back when the resetion hit he made 30k a month later

  • Buddusky

    I don’t trade penny stocks, but I started playing with a few grand in the last week and already made $1,200. Of course, I very quickly learned DO NOT TELL ANYONE what you’re doing (at least in your actual life, if not your online life). Everyone will give you a million and one reasons not to do it and why it’s for suckers, the bottom will drop out at any second, etc. Nobody seems to realize you can be realistic AND make trades. Nobody seems to realize there are outliers in every market. I made some money on Lending Club today but got out before the Fed news because it was too big of a risk of perception if the rates were going up. I was right, because the stock went up another dollar, but if the news was bad, it definitely would have went down. So just take modest returns and get out. Take modest returns and get out. Rinse and repeat. I also lost $220 this week, but that was on stocks that seemed poised for an upside reversal that never truly came and they’re sitting flaccid at support. Better to get out before there’s a bigger downside and take the hit. The money is more useful elsewhere. Anyway, I’m still learning, but it’s amazing looking at the naysayers from this side. I used to be one of them myself and realize how I didn’t understand ANYTHING about how this works.

  • Average Joe

    Hello Sir, Can you suggest a way to find these long term penny stocks, like some kind of research database. I need suggestions.

  • jaron

    If you purchase before 12/31/14, APGI would most likely give you an excellent return.
    This company can be held long term as well.

  • john

    they charge a quarter fee of $15 and can’t trade penny stock under .05.
    they used to be good for penny now really bad

  • DrTrades

    Just2Trade has been shut down for fraud. Google it.

  • john

    thanks art ill look that one up good advise

  • Kyle

    While not listed on this page, you can find our 5-star review for OptionsHouse here:

    With regards to penny stock commissions, they charge $4.95 + $0.005 per share for the entire order.

  • Jumus

    Hope you added them to your list, they were trading at 0.58 a share, now they are at 0.00. Good advice..

  • john

    this blog site is for how to find a broker or how to start investing how to buy stocks penny stocks or other and to learn about fees and costs.and who to buy from,not what to buy

  • john

    right on guys, nothing worse then people being on the wrong blog site,this site is about finding the right broker for the right deal; But rob is telling us about trade king so he is on the right blog.tell us more rob ,about low commissions and the right way to go about trading.And what companys to trade with.And what we need to know about to get the right broker

  • john

    good advise

  • john

    now I wont have to look that one up thanks Dr trades for saving me time

  • john

    now that you know why we are on this page you can go back to playing fantasy football or something

  • john


  • johngonz76

    Im looking for the same thing

  • vacuumation

    * you’re
    * you’re
    * YOU’RE