InvestorQ : Which are the best penny stocks for the long term?
natasha Samani made post

Which are the best penny stocks for the long term?

Abigail Ghoshal answered.
2 years ago
I am not sure what you mean by penny stocks but the standard definition is that of a stock that quotes below Rs.10. Remember that Penny stocks can be risky. Let us first look at 3 risks in penny stocks.
Penny stocks are normally stocks that have corrected violently from higher levels due to larger problems. Companies like IL&FS, Cox & Kings, Energy Development are all quoting at below Rs.5. But these stocks belong to companies that are almost non-existent.

Secondly, SEBI regularly monitors and reviews the action of penny stocks and so if you are found to be buying and selling penny stocks too often, then there may be some questions you will have to answer to the regulator.

Lastly, penny stocks are normally cornered by a handful of operators and they tend to take the price higher before dropping it. You may find that when you try to sell, the stock is continuously at a lower circuit and you are locked out.

For your interest, you can look at the following stocks that are quoting under Rs.20, which could be of some interest due to a late bounce. But these are risky stocks so trade them accordingly. These stocks include; Simbhaoli Sugars (Rs.9), CG Power (Rs.12), Reliance Home Finance (Rs.5.75), South Indian Bank (Rs.10), Suzlon (Rs.3.6), etc.
Most of these cases you have to be very careful and get out the moment you get a profitable trade. Liquidity can be a serious issue in these stocks so play carefully.