Penny stock (Pennystock)
A share with a very low price, usually below 1 euro or 1 US dollar, often with high risk.
In short
As of 8 October 2026A penny stock is a share with a very low price, usually below 1 euro or 1 US dollar. Often these are very small or struggling companies. Penny stocks fluctuate wildly, trade thinly and are frequent targets of fraud in which prices are pushed up artificially. A low share price does not mean the stock is cheap.
Penny stocks are shares that cost only cents, usually below 1 euro or 1 US dollar. They are often very small, young or struggling companies. A low price says nothing about whether a stock is cheap: what matters is the value of the whole company.
Penny stocks swing wildly, trade thinly and often have a wide spread. They are popular for scams: "hot tips" in chats or emails are often a pump and dump, where insiders drive the price up and then sell. The scam check shows how to spot such schemes.
Example: after a social media campaign a share jumps from 0.10 to 0.40 euros. Once the promoters sell, it drops to 0.05 euros, and late buyers lose almost everything. Germany's regulator BaFin regularly warns about such cases.
As of 8 October 2026 · Educational content, not investment or tax advice.