The U.S. Securities and Exchange Commission (SEC) defines penny stocks as securities issued by small public companies that trade for less than $5 per share. However, at TipRanks we consider shares trading for $10 or less as penny stocks. Unlike regular shares, they are often traded over the counter through the OTC (Over the Counter) Bulletin Board and are not always listed on an exchange. Hence, they can also be known as “OTC stocks”. Another difference is that there can be a lack of reliable information available about penny stocks, making it more difficult for investors to research them. This lack of information, coupled with a thin market, makes them more vulnerable to manipulation and even fraud. Saying that, some of the most successful companies in the world including Amazon, Apple, and Ford started out as penny stocks showing just what a great opportunity they can offer.null