 TITLE: What Are Penny Stocks and Are They Safe? CONTENT: Penny Stocks Are No Longer Necessary for Small-Time Investors\n-------------------------------------------------------------\nBecause of their low prices, penny stocks attract inexperienced traders who don't have a lot to invest. But with the advent of fractional shares, it's no longer necessary to take on the additional risk that penny stocks pose.\nFractional shares allow you to purchase a portion of a share in a company based on how much you want to invest. With Amazon, for instance, you don't have to have the roughly $3,100 it would take to buy a share in the company (as of January 2021). Instead, you can purchase a fractional share based on your ability to invest. With some brokerages, that figure can be as low as $1.\nWhile you won't own a whole share, you'll still be able to participate in the stock's ups and downs. Your share in gains and losses remains the same in terms of percentages but different in actual dollars.\nFor example, if you buy one share of Apple stock at $130 and the share price increases by 10%, your gain is $13. In contrast, if you own $5 worth of Apple stock via fractional shares, your gain will be $0.50.\nMany brokerages offer fractional shares, including Charles Schwab, Fidelity, Robinhood and more. END