timothy sykes logo

Best Penny Stocks Under $5 to Buy Today

Timothy SykesAvatar
Written by Timothy Sykes
Updated 10/24/2024 20 min read
Best Penny Stocks Under $5 to Buy Today Thumbnail

The best penny stocks under $5 to buy today depend on today’s chart. The fact is, 99.9% of these cheap stocks will eventually be worth less than they are right now. That’s why I tell my students to build a watchlist every day.

The best traders watch more stocks than they trade. That’s essential for getting to know the charts of these stocks — these charts will give you valuable info about their future moves. If you study the patterns these stocks follow, you can find opportunities for the kind of small gains that can grow a small account fast.

Today I’ll show you how to build a watchlist for stocks under $5. Read on for the results!

Table of Contents

Best Penny Stocks Under $5 to Buy in November 2024

The best penny stocks under $5 in November 2024 are:

This is a watchlist — not a “buy list.”

I’m sharing this so you can see my process. If you want to see more NO-COST watchlists, you can sign up for my weekly watchlist here.

What Are the Best Penny Stocks to Buy Under $5 in November 2024?

To find the best penny stocks to buy under $5 in November 2024 requires a top-level stock screener. I use the one in StocksToTrade — I helped design it, so it has all the tools and customizations I look for to create my penny stock watchlists.

Try StocksToTrade for 14 days and see how it helps your watchlist skills — only $7!

To find watch-worthy penny stocks under $5, I input the following criteria:

  • Last Price ≤ $5
  • Last Price ≥ $2
  • Volume ≥ 100,000

When I run this screen in November 2024 and sort by percent change, it gives me the following top results:

[[[{“widget”:”scn-wdgt-01-dev”, “params”: {“top_price”:”5″,”bottom_price”:”2″,”bottom_volume”:”100000″,”bottom_trades_in_a_day”:”100″}}]]]

Here are the top penny stocks under $5 I’m watching today!

Grab Holdings Limited [NASDAQ: GRAB]

Grab Holdings Inc is an investment holding company. The Group enables access to transportation, delivery, mobile payment, financial services and enterprise offerings in Southeast Asia through its mobile application (the Grab Platform).

Amylyx Pharmaceuticals Inc. [NASDAQ: AMLX]

Amylyx Pharmaceuticals Inc is a clinical-stage pharmaceutical company working on developing a novel therapeutic for amyotrophic lateral sclerosis and other neurodegenerative diseases.

BioVie Inc. [NASDAQ: BIVI]

BioVie Inc is a company developing innovative drug therapies to treat chronic debilitating conditions including liver disease and neurological and neuro-degenerative disorders and certain cancers. The company is currently focused on developing and commercializing BIV201, a novel investigational approach to the treatment of ascites due to chronic liver cirrhosis. BIV201 has the potential to improve the health of thousands of patients suffering from life-threatening complications of liver cirrhosis due to hepatitis, non-alcoholic steatohepatitis and alcoholism.

Denison Mines Corp (Canada) [AMEX: DNN]

Denison Mines Corp is a uranium exploration and development company with interests focused in the Athabasca Basin region of northern Saskatchewan, Canada. The company has an effective 95% interest in its flagship Wheeler River Uranium Project, which is the largest undeveloped uranium project in the infrastructure rich eastern portion of the Athabasca Basin region of northern Saskatchewan. The company is also engaged in mine decommissioning and environmental services through its Closed Mines group, which manages its Elliot Lake reclamation projects and provides third-party post-closure mine care and maintenance services.

B2Gold Corp (Canada) [AMEX: BTG]

B2Gold Corp is an international, low-cost, senior gold mining company. It has three operating open-pit gold mines in Mali, Namibia, and the Philippines and numerous exploration projects across four continents. Other significant assets include the Gramalote and Kiaka gold projects. The company focuses on acquiring and developing interests in mineral properties with a primary focus on gold deposits as gold production forms all its revenue. There is no dependence on a particular purchaser because the gold is sold into a global market. The company’s reportable operating segments include its mining operations and development projects, namely Fekola; Masbate; Otjikoto; other mineral properties; and corporate and other. It generates maximum revenue from the Fekola mine segment in Mali.

How to Identify the Best Penny Stocks Under $5

Penny stocks are typically defined as stocks that trade for less than $5 per share. This price point is significant because it marks the threshold between what many consider true penny stocks and less sketchy small-cap stocks.

Stocks under $5 often come from companies with smaller market capitalizations, leading to higher volatility but also potentially higher returns. Understanding this segment of the stock market is huge for traders looking to capitalize on the growth potential in low-priced stocks.

Here are the steps I follow in finding promising penny stocks under $5:

  1. Use a stock screener. Make sure your filters are set for high enough volume and percentage gain.
  2. Analyze financial statements and company management. You want to know if this is a “real” company or not.
  3. Check recent news and developments. This includes Twitter/X pumps.
  4. Review historical performance. Former runners can run again!
  5. Assess industry position and market trends. Penny stocks often run on sector momentum.

Use Stock Screeners and Filters

Stock screeners allow traders to quickly sift through thousands of stocks to find those that meet their desired parameters. This is particularly useful for identifying the best stocks under $5, as you can set filters to narrow down your choices to those with the highest growth potential and manageable volatility.

When it comes to trading platforms, StocksToTrade is first on my list. It’s a powerful trading platform that integrates with most major brokers. I helped to design it, which means it has all the trading indicators, news sources, and stock screening capabilities that traders like me look for in a platform.

I use StocksToTrade to scan for news, tweets, earning reports, and more — all covered in its powerful news scanner. It also has a selection of add-on alerts services, so you can stay ahead of the curve.

Grab your 14-day StocksToTrade trial today!

Analyze Financial Statements

Analyzing financial statements is crucial for assessing a company’s financial health. Reviewing income statements, balance sheets, and cash flow statements can provide valuable insights into a company’s profitability and sustainability. This analysis helps in understanding whether a company has solid fundamentals or if it is weighed down by debt.

Key financial ratios and metrics to look for include:

  • Earnings per Share (EPS)
  • Price-to-Earnings (P/E) Ratio
  • Debt-to-Equity Ratio
  • Current Ratio
  • Free Cash Flow

These metrics won’t tell the whole story on penny stocks, but they will give you some idea of how the company is doing.

Evaluate Company Management

The quality of a company’s management can be a huge factor in a penny stock. It’s important to evaluate the background and track record of key executives to gauge their ability to lead the company towards profitability.

Criteria for evaluating management effectiveness:

  • Professional background and experience
  • Track record in the industry
  • Past successes and failures
  • Leadership style and vision

Check Recent News and Developments

Recent news and developments can significantly impact penny stock prices and investor perception. Positive news such as new contracts, product launches, or favorable earnings reports can drive demand and push stock prices higher. Conversely, negative news can lead to sharp declines.

Strategies for staying updated on news relevant to penny stocks include:

  1. Setting up Google News alerts for specific stocks
  2. Following industry news on financial websites
  3. Joining trading forums and communities
  4. Subscribing to newsletters from reliable sources

I use the Breaking News Chat alerts service to find hot plays every day. The Breaking News chat room alerts me to important news articles in stocks and the overall economy, giving me a crucial trading edge.

In fact, roughly half of my recent trades have been based on Breaking News tips!

Get a 14-day trial of Breaking News Chat here — only $17!

Review Historical Performance

Historical performance analysis is relevant when choosing penny stocks because it helps traders understand past price movements and trading volumes. By examining how a stock has performed over time, traders can identify patterns and predict potential future behavior.

TL;DR: Former runners can run again.

Here’s how you should analyze the chart:

  1. Look at historical price charts for patterns
  2. Analyze trading volume trends
  3. Compare past performance with current market conditions
  4. Identify support and resistance levels

Assess Industry Position and Market Trends

A company’s position within its industry can influence its stock performance. Companies that hold a strong position in a growing sector are more likely to experience the spikes that good trades are built on.

Here’s how to analyze industry position and market trends:

  • Research the company’s market share
  • Evaluate industry growth rates
  • Identify key competitors
  • Monitor sector-specific news and developments

Which Is the Cheapest High-Potential Stock to Buy Right Now?

To find the cheapest high-potential stocks, you have to study their charts.

Take a look at the 1-year chart for Clean Vision Corp. [OTCPK: CLNV]:

See how many 100% spikes this stock had in the past year? Each one of these spikes was a trading opportunity — that’s the way I’ve made over $8,000 in total earnings trading this stock (click the link to see my individual trades).

However, that’s not a recommendation to “buy” this stock. See how it drops after every spike?

It follows my 7-step pennystocking framework perfectly. This is the chart you have to commit to memory:

What Are the Penny Stocks Under $5 with the Highest Potential?

Look up at the charts of the stocks above. Do you see any spikes in their long-term chart?

That’s a good sign.

History doesn’t repeat, it rhymes. And that’s a good thing for former runners…

 

If stocks under $5 aren’t exciting enough for you, check out my list of the best stocks under $2. These lower-priced stocks have the potential for BIG gains. By focusing on stocks with positive market sentiment, you can stay ahead of the crowd.

For the penny stocks under $2 that I’m watching, check out my guide on the best penny stocks under $2 to buy today.

Common Mistakes to Avoid When Trading Penny Stocks Under $5

Trading penny stocks under $5 can blow up your account if you’re not careful. Common mistakes can lead to significant losses, and it’s important to approach trading with a well-thought-out strategy. Many beginners fail to conduct thorough research, overlook financial statements, and ignore market trends and news, leading to poor trading decisions.

Here’s my general advice on how to approach penny stocks:

  • Always do your due diligence!
  • Follow your trading plan
  • Avoid emotional trading and stay disciplined
  • Cut your losses quickly!

Failing to Conduct Thorough Research

Doing your research is the cornerstone of successful penny stock trading. This is why I keep watchlists — I know all of the stocks I trade before they make their moves, and before I make mine.

Without proper research, you’re essentially gambling, which will ALWAYS lead to losses.

Knowledge is power. You want to understand all of the following for every stock you trade:

  • Company fundamentals
  • Industry conditions
  • Market sentiment
  • Competitive landscape

Overlooking Financial Statements

Neglecting a company’s financial statements can lead to trading sketchy stocks without knowing they are sketchy stocks. This can lead to significant losses, especially in the volatile penny stock market. Regularly reviewing financial statements ensures that you are aware of a company’s financial health and potential red flags.

Here’s a checklist of financial statement elements to review:

  • Income statements
  • Balance sheets
  • Cash flow statements
  • Financial ratios

Ignoring Market Trends and News

Market trends and news can dramatically affect penny stock prices. Ignoring these catalysts can lead to missed opportunities or unexpected losses. Staying informed about market trends helps traders anticipate movements and make timely decisions.

Here are my methods of staying on top of market trends and news:

  • Subscribe to financial news websites
  • Follow market analysts — and Twitter pump accounts — on social media
  • Use news aggregation tools like the news scanner on StocksToTrade
  • Set up alerts for market updates
  • Use Breaking News!

Chasing Short-Term Gains

Go for singles, never chase the home runs.

Here are my strategies for staying disciplined and following your trading plan:

  • Set realistic profit targets and stop-loss levels
  • Focus on quality over quantity of trades
  • Cut your losses quickly to reduce risk
  • Continuously reassess your trading strategy

Neglecting Diversification

Diversification is crucial in a trading portfolio, especially when including high-risk assets like penny stocks. By spreading your attention across various sectors and types of assets, you can mitigate the risks associated with any single trade.

If you want to diversify, here’s another strategy — look for undervalued stocks that may have been overlooked by the broader market. These stocks often have strong fundamentals and potential for growth but are trading at prices below their “intrinsic” value. As a trader, I believe that “only price pays” as the great Brian Shannon says — but it’s always important to understand what’s happening in the market.

Undervalued stocks can be profitable as the market corrects its valuation. Here’s my curated list of the best undervalued stocks in the market right now.

Other ways to diversify trades include:

  • Watch different sectors
  • Know the difference between large-cap and small-cap stocks
  • Understand all trading vehicles, from penny stocks to ETFs
  • Regularly review and adjust your trading strategy

Falling for Pump-and-Dump Schemes

Pump-and-dump schemes are rife in the penny stock market, where unscrupulous actors artificially inflate stock prices before selling off their shares at a profit, leaving newbies holding the bag. Recognizing pumps and knowing how to trade them is key in penny stock land.

Here are my top tips on how to spot pumps:

  • Be wary of stocks with sudden, unexplained price spikes
  • Never believe social media promoters
  • Check for insider trading activity
  • Research the company thoroughly before investing

Penny Stocks Under $5 FAQs

Just because a stock trades for under $5 doesn’t make it cheap. Read on for some more questions you might be asking…

Where can one find the list of companies’ penny stocks under $5?

Get a powerful stock screener like the one in StocksToTrade, and start building parameters. When I’m looking for tradable penny stocks under $5, I want their volume to be great enough for the stock to be liquid. This way I can enter and exit a position more easily.

What are high-volume penny stocks under $5?

A penny stock under $5 needs high volume for me to trade it. When I’m building my stock scan, I’ll typically look for stocks that have traded over 1 million shares so far that day.

The scanner I’m using in this article is set to look for penny stocks that have traded more than 100,000 shares. This will help you identify watch-worthy stocks — even if you’re looking in pre-market.

What are some great penny stocks under $5 for selling calls and puts?

Options are only offered on certain stocks. Many stocks under $5 won’t qualify.

What is Tim Sykes’ favorite stock under $5?

I don’t have a “favorite” stock under $5 — I think penny stocks are bad investments, and I don’t trust them at all. Trading scared has helped me make some profitable trades. One ticker that is ALWAYS on watch is Ozop Energy Solutions Inc. (OTCPK: OZSC) — I’ve made $45k over the years trading this penny stock (click the link for my individual trades).

What are the best stocks to buy under $5 that pay dividends?

Stocks that trade under $5 don’t usually pay dividends. Stocks that cost this little generally don’t have much going for them.

How can I find affordable stocks under $5 with good valuations?

To find affordable stocks under $5 with good valuations, traders should use stock screeners to filter stocks based on market price and valuation metrics such as the price-to-earnings ratio. Researching these stocks by analyzing their financial statements and sales data can provide more information on their potential. It’s also helpful to read expert opinions and market analysis to get ideas and examples of promising stocks.

Why are stocks under $5 considered valuable for diversified portfolios?

Stocks under $5 are bad to put in your portfolio — even though they offer significant growth potential these stocks are risky af. Never invest in penny stocks, and research stock industries, market positions, and financial health before making any trade.

What should traders consider when evaluating stocks under $5?

When evaluating stocks under $5, traders should consider the company’s overall valuation, including market price, sales figures, and industry standing. Reviewing the company’s financial health and understanding its growth prospects can reveal whether it offers good value. Traders and investors should seek diverse sources of information and opinions to make informed decisions.

* Results are not typical and will vary from person to person. Making money trading stocks takes time, dedication, and hard work. There are inherent risks involved with investing in the stock market, including the loss of your investment. Past performance in the market is not indicative of future results. Any investment is at your own risk. See Terms of Service here

The available research on day trading suggests that most active traders lose money. Fees and overtrading are major contributors to these losses.

A 2000 study called “Trading is Hazardous to Your Wealth: The Common Stock Investment Performance of Individual Investors” evaluated 66,465 U.S. households that held stocks from 1991 to 1996. The households that traded most averaged an 11.4% annual return during a period where the overall market gained 17.9%. These lower returns were attributed to overconfidence.

A 2014 paper (revised 2019) titled “Learning Fast or Slow?” analyzed the complete transaction history of the Taiwan Stock Exchange between 1992 and 2006. It looked at the ongoing performance of day traders in this sample, and found that 97% of day traders can expect to lose money from trading, and more than 90% of all day trading volume can be traced to investors who predictably lose money. Additionally, it tied the behavior of gamblers and drivers who get more speeding tickets to overtrading, and cited studies showing that legalized gambling has an inverse effect on trading volume.

A 2019 research study (revised 2020) called “Day Trading for a Living?” observed 19,646 Brazilian futures contract traders who started day trading from 2013 to 2015, and recorded two years of their trading activity. The study authors found that 97% of traders with more than 300 days actively trading lost money, and only 1.1% earned more than the Brazilian minimum wage ($16 USD per day). They hypothesized that the greater returns shown in previous studies did not differentiate between frequent day traders and those who traded rarely, and that more frequent trading activity decreases the chance of profitability.

These studies show the wide variance of the available data on day trading profitability. One thing that seems clear from the research is that most day traders lose money .

Millionaire Media 66 W Flagler St. Ste. 900 Miami, FL 33130 United States (888) 878-3621 This is for information purposes only as Millionaire Media LLC nor Timothy Sykes is registered as a securities broker-dealer or an investment adviser. No information herein is intended as securities brokerage, investment, tax, accounting or legal advice, as an offer or solicitation of an offer to sell or buy, or as an endorsement, recommendation or sponsorship of any company, security or fund. Millionaire Media LLC and Timothy Sykes cannot and does not assess, verify or guarantee the adequacy, accuracy or completeness of any information, the suitability or profitability of any particular investment, or the potential value of any investment or informational source. The reader bears responsibility for his/her own investment research and decisions, should seek the advice of a qualified securities professional before making any investment, and investigate and fully understand any and all risks before investing. Millionaire Media LLC and Timothy Sykes in no way warrants the solvency, financial condition, or investment advisability of any of the securities mentioned in communications or websites. In addition, Millionaire Media LLC and Timothy Sykes accepts no liability whatsoever for any direct or consequential loss arising from any use of this information. This information is not intended to be used as the sole basis of any investment decision, nor should it be construed as advice designed to meet the investment needs of any particular investor. Past performance is not necessarily indicative of future returns.

Citations for Disclaimer

Barber, Brad M. and Odean, Terrance, Trading is Hazardous to Your Wealth: The Common Stock Investment Performance of Individual Investors. Available at SSRN: “Day Trading for a Living?”

Barber, Brad M. and Lee, Yi-Tsung and Liu, Yu-Jane and Odean, Terrance and Zhang, Ke, Learning Fast or Slow? (May 28, 2019). Forthcoming: Review of Asset Pricing Studies, Available at SSRN: “https://ssrn.com/abstract=2535636”

Chague, Fernando and De-Losso, Rodrigo and Giovannetti, Bruno, Day Trading for a Living? (June 11, 2020). Available at SSRN: “https://ssrn.com/abstract=3423101”