Today we are going to take a look at a few stocks trading under $10 but before we get started I want to talk about the pro's & con's of trading these stocks.
I have enjoyed some of my largest percentage gains (and losses) trading these type of stocks, second only to Option trading. When we trade Options we are restricted by time, in fact as the Option buyer we suffer time decay each and every day so time is our worst enemy.
I like to look at trading under $10 stocks as Options that never expire and that is one of the pro's because as you know if you have traded the markets, sometimes we are right on a stock but off on timing so the trade may need time to mature, we do not have that luxury when trading Options.
One of the biggest draw backs of trading under $10 stock is that many times these stocks are under $500 mil. market cap and have lower average daily volumes along with a much smaller float (shares outstanding) so these stocks can easily take 10% or more moves on any given day. If you do not trade Options at all but would like to have a percentage of your portfolio positioned for higher risk / higher reward then perhaps taking 5 or 10% of available funds and trading under $10 stocks could be just what your looking for.
Below is our list of top 5 stocks under $10 to add to your watch list.
Ruth's Hospitality Group Inc. - (RUTH) - This stock has just hit a new 52 week high on strong volume, it has a market cap of $300 mil. and average daily volume of about 200k. The Ruth's Chris Steak House legacy began when Ruth Fertel mortgaged her home for $22,000 to purchase the "Chris Steak House," a 60-seat restaurant located in New Orleans, Louisiana. Today there are more than 120 Ruth's Chris Steak House restaurants. Investors webpage
Aware Inc. - (AWRE) - This stock trades 20% off its 52 week high after a high volume run to the $6 level. Market cap is just $110 mil. and average daily volume is around 100k. Aware has been a leading innovator of advanced signal processing technologies since its founding in 1986. Processing and analysis of digital data and image “signals” has vital applications in a diverse range of large and growing industries. Investors webpage
Zix Corp. - (ZIXI) - This stock has enjoyed a strong volume rally above $3 to close Friday at $3.38 and just 1% off 52 week highs. It has a market cap of $210 mil. and average daily volume of 250k. ZixCorp offers industry-leading email encryption and a unique email DLP solution, ZixCorp is trusted by nation's most influential institutions in healthcare, finance and government for easy to use secure email solutions. Investors webpage
Smith & Wesson Holding Corp. - (SWHC) - This stock trades 16% off its 52 week high and is working on a new base after a high volume sell off following the Newtown Conn. tragedy. A U.S.-based leader in firearm manufacturing and design, delivering a broad portfolio of quality firearms, related products and training to the global military, law enforcement, and consumer markets. The company's brands include Smith & Wesson, M&P and Thompson/Center arms. Smith & Wesson facilities are located in Massachusetts and Maine. Investors webpage
Xinyuan Real Estate Co. Ltd. - (XIN) - A high volume break over $4 has this stock trading at $4.87 and just 2% from a 52 week high. It has a market cap of $350 mil. and average daily volume of 500k. A developer of large scale, high quality residential real estate projects in China, aimed at providing middle-income consumers with a comfortable and convenient community lifestyle. Investors webpage
That is all for now and as always your comments and questions are welcomed either by comment or you can reach me by email at firstname.lastname@example.org
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Best Wishes, $$$, ET.