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Penny stocks are a term that originally referred to companies with shares available for less than 1 US dollar. Presently, in the US, penny stocks are companies that trade for less than 5 dollars. For Australian companies, most experts still consider penny stocks to be those available for less than 1 Australian dollar. However, the term no longer has a strict definition and loosely refers to companies with a low share price.
The ASX is the Australian Securities Exchange, Australia's benchmark securities exchange, and represents one of the top 10 leading global exchanges by market capitalisation, alongside the New York Stock Exchange (NYSE), the Nasdaq, and the London Stock Exchange (LSE). The ASX facilitates electronic trading, which has opened investment opportunities to global traders.
With FP Markets, investors can trade ASX-listed shares through CFD products (Contracts for Differences), allowing traders and investors to speculate on the underlying price movement of a particular stock.
The following 10 penny stocks are available to trade through FP Markets.
1- Core Lithium (ASX: CXO) – is an Australian mining company looking to become a significant global supplier of Lithium, and is currently building a mine on the outskirts of Darwin in the Northern Territory. Notably, lithium is required for electric vehicle manufacturing. Given the political and social incentive for green energy production, demand for commodities needed to produce renewable energy is expected to rise. US Lithium demand is scheduled to surge five-fold by 2030, with global demand to follow suit. Lead experts predict Core Lithium to break out soon after an annual loss registered in 2022.
2- Argosy Minerals (ASX: AGY) – represents another mining company listed on the ASX, with lithium projects located in the US state of Nevada and in Salta Province, Argentina. The company expects to increase its Lithium output, and as previously mentioned, the market is likely to grow.
3- MinRex Resources (ASX: MRR) – serves as a gold and base metal mining company. Gold reached its highest price point ever recorded in 2020 at $2,075. The commodity tends to perform well in times of global economic instability. Gold's prospects, according to analysis, appear positive; therefore, MinRex can potentially outperform and generate returns. The company's base metal mining operation adds to the attraction with added deposits of Lithium and Tantalum.
4- E2 Metals Limited (ASX: E2M) – is another mining company, this time focused on gold and silver, which is based in Australia with global projects and deposits, most notably in Argentina. As mentioned, gold has a strong track record and future prospects. Silver has long been the second precious metal behind gold. It is used as a store of value and has various industrial purposes due to multiple characteristics, including durability, malleability and ability to conduct energy and heat. The prospects for both commodities mean the company has considerable potential.
5- Prescient Therapeutics (ASX: PTX) – Switching focus to technology, Prescient Therapeutics is a biotechnology company devoted to cancer treatment through cellular and targeted therapies. The company has successfully created FDA-approved medicine, leading to a rise in its stock price. The sector is, therefore, primed for growth, making PTX a stock to watch.
6- Tesserent Limited (ASX: TNT) – is a cybersecurity company that services businesses in Australia and New Zealand. The company delivers tailor-made solutions to prevent, detect and mitigate potential cyber-attacks. Data has become increasingly valuable during the 21st century. Therefore, data protection is one of the most critical challenges businesses face. TNT, as a result, offers portfolio diversification in a growing sector.
7- Nitro Software (ASX: NTO) – is a technology company focused on creating an electronic signature solution for businesses to create, edit, share, sign, and review pdf documents on a secure platform. In the modern age of working from home, sparked by the COVID pandemic, many workplaces struggle to get multiple signatures on a single document and Nitro Software offers a solution for this. Demand for this technology will likely grow as businesses continue operating remotely and globally.
8- Bubs Australia (ASX: BUB) – is a company that provides a niche area for investment: baby food. The company stands out due to the high-quality organic ingredients it uses from reputable suppliers. The company has secured US and EU compliance to become a global premium baby food brand. Bubs, therefore, provides investors with a good option for portfolio diversification in a potentially growing company.
9- Byron Energy (ASX: BYE) – Switching focus to energy companies, Byron Energy offers access to a considerably large company for a low price. The company has vast holdings of oil and gas wells around the Gulf of Mexico. Even though green energy is the focus for many governments and companies, there remains a global reliance on oil and gas which will likely see the demand for these energy sources continue.
10- Air New Zealand (ASX: AIZ) – offers a source for investment in the airline industry. The company undertakes passenger and cargo transportation between Oceania and major markets, including the US, Europe, and Asia. Valued at 2.58 billion, Air New Zealand offers an interesting prospect for a low initial investment. The industry has survived a difficult period due to the impact of the pandemic, which saw all air travel grounded to a halt. The company has survived and is positioned to potentially thrive.
*All stocks listed except Nitro Software (NTO) are available for less than 1 Australian dollar.
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