What is penny stock trading

In the Hong Kong stock market, penny stocks refer to stocks that trade for low prices (Moomoo Financial Inc.defines stocks trading for less than 1 HKD as penny stocks). Penny stocks feature significant price fluctuation, poor liquidity, and higher probability of delisting, making it inconvenient to obtain accurate information. Normally, ordinary investors are not recommended to buy penny stocks.

1. How to trade Hong Kong penny stocks?

Penny stocks, as a type of stock, trade in an normal way in terms of trading process, trading hours, and order types.

Notes: Due to the high risk, if it is your first time to trade penny stocks, you need to confirm the risk during the trading process before you can trade.

2. If a stock’s price falls below 1 HKD, can the stock still trade?

If a stock’s price falls below 1 HKD, the stock will be deemed as a penny stock and you can close your position. If you open a position and it is your first time to trade penny stocks, you also need to confirm the risk first.

3. What are the risks involved in penny stock trading?

● There is no daily price limit on Hong Kong stocks, and prices of penny stocks may fluctuate greatly within a day;

● Penny stocks are generally traded lightly and have high liquidity risks;

● The delisting risk of penny stocks is greater than that of ordinary stocks.

Moomoo is a professional trading app offered by Moomoo Technologies Inc. In the U.S., investment products and services on Moomoo are offered by Moomoo Financial Inc., Member FINRA/SIPC.

Any illustrations, scenarios, or specific securities referenced herein are strictly for illustrative purposes. Past investment performance does not guarantee future results. Investing involves risk and the potential to lose principal.