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If you’ve got a list of penny stocks, that’s great. But how are you supposed to tell which penny stocks are the best?

Finding the best penny stocks really isn’t that much different than finding the best stocks in the Dow Jones. It requires the same kind of research if you were investing in a penny stock as if you were investing into Google.

You’ve got to be able to know that you’re investing in a company with strong fundamentals. Make sure their financial statements are in order. You want to invest in companies that have had a good history of strong profits and profit margin. Its also important to see that the company’s assets keep rising every quarter.

A key component is also the charting of the stocks. If you ever back test penny stocks that have gone up by a lot, it usually broke a major resistance point before it did that. You always want to be on the lookout for that.

The other big factor is news. A big news event for a company can take it from a the depths of a penny stock to major player in the market. The next thing you know you?ll be reading about them in the Wall Street Journal.

Yet another factor is the what kind of ideas does the company have? An idea by itself could be worth millions of dollars. There have been so many companies that became major players in the market just because of some innovative ideas.

It may seem like quite a difficult task trying to cover all these important aspects of trading, but luckily there is software that was developed to automate the process.

The people who invented the software decided to start an excellent newsletter service so people can stop spending so much time researching and more time trading. The software makes about three or 4 picks a month and has a great history of trades.