Warren Buffett Penny Stocks Essay

167 Words1 Pages
Warren Buffett has never invested in penny stocks. Penny stocks are volatile and speculative, very few reputable companies trade as penny stocks. In his early ears, his returns were higher for several reasons: * He managed much smaller capital in the 1950s and early 60s. With little capital, one can invest in mid-size and small companies and easily buy and sell. That helps to get better returns as one has more options and opportunities for investments. Berkshire owns 10% of Wells Fargo, it can’t just unload it one day and invest money somewhere else. * In the 1950s, competition in the stock market was much weaker. Many people still remembered the Crash and were reluctant to invest in the market. * In the 50s and early 60s, the market rallied.