A stock that typically sells for less than $5 per share (or in some cases, less than $1 per share) is called a(n) __________ stock.

Understand the Problem

The question is asking for the term that describes a stock typically priced under $5 per share, in order to fill in the blank in the statement provided.

More Information

Penny stocks are low-priced stocks that often attract investors looking for speculative investments. They are generally considered risky due to their volatility and lack of liquidity.

Tips

A common mistake is confusing penny stocks with blue chip stocks, which are typically well-established companies with stable earnings.

Sources

• Solved A stock that typically sells for less than $5 per | Chegg.com - chegg.com