Multibagger Stock: Achieving massive returns in the markets means taking some risk. One of this risk is investing in penny stocks. Penny stocks, as the name suggests, are stocks that are very cheap and have a low market capitalization. The price of these stocks is generally less than Rs 25, which makes them very attractive to investors but the risk is equally high.
These are the stocks which are not very popular among the investors. There is very little information available about the fundamentals of such stocks, so it is very difficult to research and analyze them. However, such stocks can have a lot of potential to become a multibagger giving huge returns to investors in a short span of time.
These stocks are also traded in very low volumes and hence it is easy for them to touch the high circuit repeatedly in trading. However, the same is true for the lower circuit. If an investor is able to find a penny stock with good fundamentals and buy the stock at a very low valuation, he can make huge profits.
Investing in penny stocks is not very common due to the high risk involved. Only investors with high risk appetite are advised to do so. The chances of such stocks breaking down are also very high. Even if you are a high-risk investor, penny stocks should not make up more than 2 to 3 percent of your portfolio. Also, buy and hold method should not be adopted with such shares. If you have got good returns from the stock, then it is more advisable to sell than to hold.
Despite the high risk, some penny stocks have managed to generate exorbitant returns for the investors over the past 1 year. Let’s take a look at some such stocks:
Flomic Global Logistics – 9,113%
- The stock has risen from around Rs 1.24 in October 2020 to around Rs 114 currently, giving investors returns of over 9,100 per cent in just 1 year.
Adinath Textiles – 4,717%
- The stock has risen from around Rs 1.48 in October 2020 to around Rs 71 at present, giving its investors a return of 4,717 per cent in just 1 year.
Tata Teleservices – 1,223%
- The stock has risen from around Rs 3 in October 2020 to around Rs 40 currently, giving its investors a return of 1,223 per cent in just 1 year.
Brightcom Group – 1,186%
- The stock has risen from around Rs 5.5 in October 2020 to around Rs 71 at present, giving its investors a return of 1,186 per cent in just 1 year.
Waaree Renewable Technologies – 938%
- The stock has risen from around Rs 17.8 in October 2020 to around Rs 185 currently, giving a return of 938 per cent to its investors in just 1 year.
Disclaimer: (The information provided here is for informational purposes only. It is important to mention here that investing in the market is subject to market risks. Always consult an expert before investing money as an investor. Anyone from ABPLive.com Also investing money is never advised here.)
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