They are risky as many do not have information required by SEC and the major exchanges. They are traded over the counter, OTC. They cannot be shorted (and most likely you do not want to do so even it was allowed). Pier 1, Ford, American Airlines and many others were all penny stocks. Expect one winner for several losers. However, the total profit could outpace the total loss if the strategy is properly implemented. Do not expect to be rich...