Prefer penny stocks because i can buy more lots ?While it may makes speculative senses that penny stock may have higher price variations by percentage term, buying large priced stocks only means fewer lots. The returns from penny or large cap stock for same percentage amount change will still yield same absolute returns mathematically.
Do highest dividend pays ?
A stock price $1 with 5% dividends will distribute 5 cents. To achieve 10 cents return in a year few things can happen.
a. Company has higher returns increasing dividend to 10%
b. Company made a lost, stock price drop to $0.50. Dividend will increase to 10% too.
Do averaging down works ?
Stock Price $2. Company report bad result and price drop to $1.5. That's -25% losses.
Buy equal amount at $1.5 again. Total cost is $3.5 now. Magically -14.3% loss. Feel good right ?
What happen Company ......