Cheap stocks to buy are enticing for many investors, because the theory is that a low-priced company can double faster from $5 to $10 than a high-priced company can double from $50 to $100 per share.
For the record, this is the biggest load of baloney in the world — cheap stocks do not guarantee faster or bigger returns, and those looking for the “best” cheap stocks to buy need to understand that many low-priced equities are low because they’ve crashed and burned.
RadioShack was a cheap stock in early 2012 at under $7 a share and paying a 13-cent dividend … and now RSH stock trades at around 60 cents, and that dividend is long gone. At the same time, Chipotle certainly was not a cheap stock in 2012, trading at its lowest for around $250 for a single share. Now CMG stock is pushing $680.
So you see, finding cheap stocks to buy only works if you are actually finding a good stock. Whether it trades for a few bucks per share is academic; only the underlying business matters.
But since so many people love cheap stocks and throw their money after dangerous investments, I consider this list a public service. If you’re gonna swim with the sharks, hopefully this article on cheap stocks to buy will arm you with some good information.
So disclaimers aside, here are my top 10 stocks under $10 for those of you looking at cheap stocks to buy now.