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10 Top AI and Quantum Computing Penny Stocks for Mar. 2025

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Written by Timothy Sykes
Updated 3/4/2025 34 min read

 

Artificial intelligence (AI) penny stocks trade below $5, and are known for their high risk and potential high reward. These stocks generally belong to smaller companies at the forefront of integrating AI into diverse products and services. For traders, these stocks present a chance to take advantage of the hottest sector right now. However, the inherent volatility and the nascent stage of these companies necessitate thorough analysis and a sharp awareness of market trends.

Table of Contents

10 AI and Quantum Computing Stocks To Watch

My top AI and quantum computing stock picks for March — rated on chart pattern, price action history, and news — include the following:

Stock TickerCompanyPerformance (YTD)
NASDAQ: JTAIJet.AI Inc+ 49.01%
NASDAQ: STAIScanTech AI Systems Inc- 7.66%
NASDAQ: AIFFFirefly Neuroscience Inc+ 77.93%
NASDAQ: SOUNSoundHound AI Inc- 47.30%
NASDAQ: CSAICloudastructure Inc- 78.96%
NASDAQ: RGTIRigetti Computing Inc- 57.83%
NASDAQ: QUBTQuantum Computing Inc- 66.84%
NYSE: QBTSD-Wave Quantum Inc- 41.42%
NASDAQ: LAESSealsq Corp- 66.49%
NYSE: IONQIONQ Inc- 42.83%

The penny stocks on this list are some of the wildest movers on the market …

Especially in the wake of the DeepSeek news — the low-cost Chinese AI model that shook the markets last week!

Trading any of these stocks should be approached with a clear strategy and an understanding of the risks involved. I don’t trade until I see a setup I like.

Jump ahead to get to my trading plans for these top AI stocks!

10 Best AI and Quantum Computing Stocks for March 2024

My top AI and quantum computing penny stock picks are:

  • NASDAQ: JTAI — Jet.AI Inc — The AI Data Center Penny Stock With the Yo-Yo Price Action
  • NASDAQ: STAI — ScanTech AI Systems Inc — The New Contract AI Security Penny Stock
  • NASDAQ: AIFF — Firefly Neuroscience Inc — The NVIDIA Partnership AI Biotech Penny Stock
  • NASDAQ: SOUN — SoundHound AI Inc — The AI Voice Stock That NVIDIA Sold Its Shares In
  • NASDAQ: CSAI — Cloudastructure Inc — The New AI Security Stock That Is Coming in Hot
  • NASDAQ: RGTI — Rigetti Computing Inc — The Quantum Computing Sector Leader I’m Watching for the Next Run
  • NASDAQ: QUBT — Quantum Computing Inc — The Short Report Quantum Computing Stock
  • NYSE: QBTS — D-Wave Quantum Inc — The New Order Quantum Computing Stock
  • NASDAQ: LAES — Sealsq Corp — The Semiconductor and Quantum Computing Penny Stock
  • NYSE: IONQ — IONQ Inc — The Quantum Computing Stock With the Disappointing Earnings Win

Before you send in your orders, take note: I have NO plans to trade these stocks unless they fit my preferred setups. This is only a watchlist.

The best traders watch more than they trade. That’s what I’m trying to model here. Pay attention to the work that goes in, not the picks that come out.

Sign up for my NO-COST weekly watchlist to get my latest picks!

Here’s some background info on the AI sector:

  • What is the most promising AI stock?

A sector leader like NVIDIA Corp (NASDAQ: NVDA) is the best bet for the most promising AI stock. But remember, we’re traders, not investors. So the stocks on this list are ones we’re watching for short-term moves, not predictions of which will lead stock exchanges in 2030.

  • What are the top 3 AI stocks to buy now?

My top 3 AI stocks to buy now (as long as their price action is strong) are SoundHound AI Inc (NASDAQ: SOUN), Applovin Corp (NASDAQ: APP), and NVIDIA Corp (NASDAQ: NVDA).

  • What are the top 3 quantum computing stocks to buy now?

My top 3 quantum computing stocks to buy now (as long as their price action is strong) are Rigetti Computing Inc (NASDAQ: RGTI), D-Wave Quantum Inc (NYSE: QBTS), and IONQ Inc (NYSE: IONQ).

  • Which company is most advanced in AI?

NVIDIA is the most advanced publicly traded company in AI, that’s why it’s the sector leader. But other leading tech stocks like Apple, Microsoft, Google, and Facebook are all safe bets to pull ahead at some point.

  • Which Artificial Intelligence stocks have a “Strong Buy” analyst rating?

Analysts tend to love these tech leaders — NVIDIA, Microsoft, Google, and Facebook. Most analysts have rated all of these stocks as “strong buys.”

Let’s get to the picks …

1. Jet.AI Inc (NASDAQ: JTAI) — The AI Data Center Penny Stock With the Yo-Yo Price Action

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My first AI penny stock pick is Jet.AI Inc (NASDAQ: JTAI).

On Friday, February 14, Jet.AI Inc. (NASDAQ: JTAI) spiked 210%* after announcing acquisition news from flyExclusive.

I pulled a 20% gain from the spike. Take a look at my trade notes below:

Source: Profit.ly

Why I Like It

A business merger is a good trading catalyst because it shows growth and legitimate business momentum.

This is what we call news that “has legs” because it could cause the stock to spike for multiple days.

Plus, StocksToTrade shows that the float is only 572k shares … That’s a tiny share count. And it could propel the share price much higher.

Stocks with a low supply of shares will help the price spike higher when demand increases. We look for stocks with less than 10 million shares.

JTAI showed us great volatility after the initial day of spiking.

And since the float is still low, any additional announcement could send shares toward the breakout level: Around $11 per share. Keep an eye on that level.

2. ScanTech AI Systems Inc (NASDAQ: STAI) — The New Contract AI Security Penny Stock

My second AI penny stock pick is ScanTech AI Systems Inc (NASDAQ: STAI) .

On February 18 during premarket hours, STAI announced an initiative to find contraband in correctional facilities using AI. The initiative is set to start in the Virginia Department of Corrections.

The price spiked 150%* over the next few days as a direct result.

I was able to make an early trade on this runner thanks to StocksToTrade’s Breaking News service.

Look at my trade notes below:

Source: Profit.ly

Here’s the alert from Breaking News. Every candle represents one trading minute:

STAI chart, intraday, 1-minute candles Source: StocksToTrade

Get the next Breaking News announcement.

Why I Like It

Similar to JTAI, the first stock on this watchlist, STAI stayed volatile for multiple days.

It also has a float below 10 million shares: StocksToTrade says there are 2.4 million shares in the float.

STAI is a perfect candidate for a follow-up spike in this volatile AI market.

More Breaking News

3. Firefly Neuroscience Inc (NASDAQ: AIFF) — The NVIDIA Partnership AI Biotech Penny Stock

My third AI penny stock pick is Firefly Neuroscience Inc (NASDAQ: AIFF).

On February 11, we learned that AIFF was accepted into an NVIDIA connect program.

The price spiked 450%* in less than 3 days after the news was announced.

And StocksToTrade says that the float is only 3.2 million shares.

Why I Like It

The reasons that I listed above are enough to keep AIFF on this watchlist. But we have to discuss a larger opportunity that’s at play here …

AIFF isn’t the first penny stock to spike 100%-plus after announcing news with NVDA.

Look at the post below from StocksToTrade:

AIFF wasn’t the first NVIDIA spiker … and it likely won’t be the last.

Get ahead of the curve, keep an eye out for the next penny stock to announce news with NVIDIA!

4. SoundHound AI Inc (NASDAQ: SOUN) — The AI Voice Stock That NVIDIA Sold Its Shares In

My fourth AI penny stock pick is SoundHound AI Inc (NASDAQ: SOUN).

SOUN spiked 350%* after the market learned of NVIDIA’s stake in the penny stock on July 19, 2024.

And the stock made new all-time highs toward the end of 2024.

But on February 14 during premarket hours, we learned that NVIDIA was no longer holding shares of SOUN.

The stock dropped 30% that day.

Why I Like It

It’s not the NVIDIA winner that it once was.

But this is still an inexpensive AI stock in a bullish AI sector that’s in full swing.

Past spikers can spike again.

Don’t count SOUN out. Look for bullish price action and wait for our trade patterns to develop.

5. Cloudastructure Inc (NASDAQ: CSAI) — The New AI Security Stock That Is Coming in Hot

My fifth AI penny stock pick is Cloudastructure Inc (NASDAQ: CSAI).

This stock started trading on January 30.

I traded it on February 10 at the bottom of the initial selloff.

I knew that it was a strong spike to trade because the volume was massive compared to all the previous trading days.

It traded 10 million shares on February 10.

Compared to the previous day’s volume of only 258k shares.

Here are my trade notes:

Source: Profit.ly

Why I Like It

On February 12 the company announced that it was selected by a leading property management firm in DC for AI security measures.

The price spiked 300%* after the announcement.

Prices sold off drastically on February 14 and 18. But StocksToTrade shows that the float is only 2.5 million shares …

Remember that past spikers can spike again. And this stock is still new for the market. That lends volatility to the price action.

6. Rigetti Computing Inc (NASDAQ: RGTI) — The Quantum Computing Sector Leader I’m Watching for the Next Run

My sixth AI penny stock pick is Rigetti Computing Inc (NASDAQ: RGTI).

This is a quantum stock that plunged in early January, alongside the rest of the sector.

The selloff on these quantum computing stocks happened in response to Jensen Huang’s comments about the sector on January 8.

The NVDA CEO mentioned that the market is still many years away from true quantum computers. And the sector took it as a massive gut punch.

IonQ’s earnings report on February 26 was another gut punch. IonQ beat revenue expectations, but the numbers also reminded traders that real profits are still way off in the future. RGTI dropped immediately in sympathy — falling from the low $10s to just above $8 — a level it hasn’t traded at since mid-January.

Why I Like It

I’m still watching this sector because of its initial volatility. Past spikers can spike again.

Plus, on February 19, Microsoft announced an extremely bullish catalyst for the sector. Look at the heading below:

Source: Microsoft.com

The chip expects to bring quantum computers to the market in “years, not decades”.

The sector bounced a bit after the announcement but it has yet to regain the momentum we saw in late 2024.

It could perk up at any time.

7. Quantum Computing Inc (NASDAQ: QUBT) — The Short Report Quantum Computing Stock

My seventh AI penny stock pick is Quantum Computing Inc (NASDAQ: QUBT).

QUBT spiked 1,800%* in late 2024 alongside the rest of the quantum computing stocks.

I traded it a few times, here’s an example:

Source: Profit.ly

Why I Like It

Now that the price fell lower with the rest of the sector, I could find another setup on this stock if it rallies upward.

For example, on January 15 we saw a solid bounce day. Prices rallied 50%.

That’s the kind of price action that we like to trade.

Prompt my AI trading bot with the QUBT ticker.

It will give you a trade plan as if you asked me directly!

8. D-Wave Quantum Inc (NYSE: QBTS) — The New Order Quantum Computing Stock

My eighth AI penny stock pick is D-Wave Quantum Inc (NYSE: QBTS).

On February 19, in tandem with the Microsoft microchip news, QBTS announced that it sold a quantum computer to the Julich Supercomputing Centre at Forschungszentrum Julich.

The price rallied 30% after the news.

Why I Like It

Jensen Huang says that we’re decades away from true quantum computers in the market …

Then Microsoft announces its quantum computer microchip breakthrough …

And the same day, QBTS announced that it sold a quantum computer to a client …

This sector is ready to make a HUGE comeback in the market!

Try not to blink. You might miss it.

9. Sealsq Corp (NASDAQ: LAES) — The Semiconductor and Quantum Computing Penny Stock

My ninth AI penny stock pick is Sealsq Corp (NASDAQ: LAES).

This stock spiked 2,700%* during the quantum computing sector run in 2024.

Why I Like It

I’m still watching these quantum stocks because there’s a chance they can bounce, at the very least.

I traded this runner on the front end of the spike last December. Take a look at an example below:

Source: Profit.ly

Plus, LAES is a semiconductor stock as well.

Which means, the company holds value outside of the quantum sector. Its chips can be utilized by regular tech companies across the board.

That bodes well for future business prospects regardless of the quantum sector.

10. IONQ Inc (NYSE: IONQ) — The Quantum Computing Stock With the Disappointing Earnings Win

My tenth AI penny stock pick is IONQ Inc (NYSE: IONQ).

IONQ has been one of the biggest movers in the sector. In late 2024, it surged from $21 to $54 before pulling back.

Now, after posting better-than-expected earnings, traders are still running for the exits. IonQ reported a widening quarterly loss, dwindling cash reserves, and growing operating expenses.

  • Q4 revenue: $11.7 million (vs. $10.3 million expected)
  • IONQ stock dropped from nearly $30 to a low of $23 after the report
  • Other quantum stocks saw sympathy moves on a broader sector pullback

At times like this, it pays to keep Warren Buffett’s advice in mind: “Be fearful when others are greedy and greedy when others are fearful.”

There’s also my advice — watch for the bounce.

  • Why traders are watching IONQ:
    • One of the biggest names in quantum computing
    • Q4 revenue beat expectations but failed to spark a post-earnings rally
    • Dropped nearly 50% from January highs, now trading around a key support zone

If the sector gets hot again, IONQ is likely to lead the charge. But if it keeps fading, shorts may press their bets. Either way, expect volatility.

Why I Like It

Don’t sleep on these former runners.

Traders who only play the front half forego profit opportunities later in the framework.

I was trading IONQ in November 2024 when the price was $21. Take a look at my trade notes below:

Source: Profit.ly

Past spikers can spike again.

And the quantum computing sector is extremely volatile right now …

Get ready for more price surges.

 

*Past performance does not indicate future results

Can I Buy DeepSeek Stock?

You can’t buy DeepSeek stock yet. DeepSeek AI is a Chinese AI startup, not a publicly-traded company. That means there is no stock symbol or ticker symbol available for purchase on any stock exchange.

The rise of DeepSeek AI has sent shockwaves through the artificial intelligence sector, triggering a stock market reaction that saw tech stocks sell off in response. The stocks on this watchlist are some of the stocks you can buy…

NVIDIA Corp (NASDAQ: NVDA), Meta Platforms Inc (NASDAQ: META) and Palantir Technologies Inc (NASDAQ: PLTR) are some of the more expensive AI stocks that traders are buying on the dip after DeepSeek’s release.

If you’ve got your sights set on DeepSeek, here’s what you need to know.

Is DeepSeek Publicly Traded?

As of early 2025, DeepSeek AI is a private company owned by Chinese hedge fund High-Flyer, which was founded by Liang Wenfeng. This means that investors cannot buy DeepSeek AI stock through popular trading platforms or traditional share trading apps.

The company first gained attention when its DeepSeek-V3 model, an open-source large language model, became the most-downloaded free app on Apple’s App Store in the U.S. This previously-little-known AI app has since sparked discussions about its potential to challenge U.S. AI leaders like OpenAI and Google.

Despite its huge demand, DeepSeek remains private and is currently not listed on any major stock exchange globally.

When Will DeepSeek Have an IPO?

There is no official timeline for a DeepSeek AI IPO, and the company has not announced any plans to go public. As a Chinese AI startup, it may face regulatory challenges if it decides to list on a U.S. exchange like the Nasdaq or the New York Stock Exchange (NYSE).

Given the ongoing technology arms race between the U.S. and China, any potential DeepSeek AI IPO would likely be closely scrutinized by governments on both sides.

If DeepSeek AI does eventually pursue a public listing, it could follow a path similar to Alibaba Group Holding Ltd. (NYSE: BABA), which first debuted in the U.S. before later exploring listings in China. However, until official news emerges, investors should remain cautious about speculation surrounding a DeepSeek IPO.

How Can You Invest in DeepSeek?

Because DeepSeek AI stock is not currently available, traders and tech investors cannot directly deposit funds into a brokerage account to purchase shares. The company remains under the control of Chinese hedge fund co High-Flyer, a quantitative hedge fund specializing in AI-driven strategies.

For those interested in the artificial intelligence industry, the supply chain surrounding AI-related stocks may provide alternative investment opportunities. Companies involved in advanced chips and AI infrastructure could see increased demand as the sector evolves.

However, caution is necessary. The stock selloff following DeepSeek’s rise underscores the volatility of the tech stocks market, especially in periods of uncertainty.

But for traders like me, that can create opportunity.

What Is Artificial Intelligence?

Artificial intelligence is when a computer simulates human intelligence. Artificial intelligence technology seeks to create machines that can fill roles traditionally carried out by people.

There’s a wide range of things you can accomplish with AI. Recent artificial intelligence products include chatbots, self-driving cars, industrial robotic solutions, and smart assistants. While we might still be very far from truly smart robots like the Star Wars droids or the Transformers, we’re closer than we’ve ever been before.

What Are AI Penny Stocks?

AI penny stocks are shares of small artificial intelligence companies that trade at a low price, often under $5. These stocks are part of an industry that’s booming with potential, from machine learning to data analytics. Just because they’re cheap doesn’t mean they’re a sure bet. I’ve been trading and teaching for years, and I can tell you that these stocks can be as volatile as a shaken soda can.

The allure of AI penny stocks lies in their growth potential. Companies in this sector are often in the early stages of development, focusing on applications like chatbots, security, and advertising. Investors are drawn to the high-reward prospects, but it’s crucial to understand the risks involved. You’re not just investing money; you’re investing in a business’s potential to revolutionize industries.

Apply for my Trading Challenge today and learn how to trade artificial intelligence stocks!

AI isn’t the only hot sector out there. Another sector that’s making headlines is green energy. Check out these 7 green energy penny stocks that are worth watching.

What Makes AI Penny Stocks Unique?

AI penny stocks are distinct due to their involvement in cutting-edge technology and the small-cap market. These companies, often in the early stages of development, harness artificial intelligence to drive innovation in various sectors, from automation to data analysis. The market size for AI-driven companies is rapidly expanding, making these stocks particularly volatile. This volatility can lead to high returns but also poses significant risks. Understanding these characteristics is crucial for traders looking to capitalize on AI’s growth potential.

Critical factors that differentiate AI penny stocks from other tech stocks and traditional penny stocks include:

  • Technology adoption: AI companies are at the forefront of technological innovation, often developing unique applications of AI.
  • Regulatory environment: AI technology is subject to evolving regulations, which can impact company operations and stock performance.
  • Investment risks: High volatility and the nascent stage of many AI companies mean potential for significant gains or losses.
  • Market position: Many AI penny stocks are small-cap companies with limited market presence compared to established tech giants.
  • Innovation pace: The rapid pace of AI development can lead to swift changes in company fortunes, impacting stock prices dramatically.

AI stocks often experience significant price fluctuations driven by technological advancements and market adoption rates. Expanding your portfolio with tech penny stocks can further diversify your investment and capitalize on the tech sector’s growth. To explore promising tech penny stocks and gain insights into their market potential, check out this comprehensive list of tech penny stocks.

What to Look for in an Artificial Intelligence Penny Stock

Like with any stock, the best way to prepare for artificial intelligence penny stock rallies is to build a watchlist. A good watchlist will build up your knowledge about specific stocks, as well as keep you prepared for the opportunities that may come.

Don’t take your penny stock lists from other people’s picks — not even mine. Other traders have different priorities, goals, and risk appetites. Here’s what to look for in a penny stock when building your watchlist:

Exhibits a Tradeable Pattern on its Stock Chart

Start with the chart.

The stocks that make my watchlists have a record of tradeable chart patterns. Check out the charts in the previous section. Penny stocks follow a boom-and-bust cycle. Since they’re mostly stocks in worthless companies that are temporarily inflated by lying promoters and gullible newbies, their patterns often repeat.

If you want to get the best read on their charts, you need a powerful trading platform on your side like StocksToTrade.

I helped design StocksToTrade. So it makes sense that it has all the features traders like me want in a trading platform.

No more navigating clunky software or hopping between multiple windows to check on the news — StocksToTrade has everything you need!

StocksToTrade has changed the way I trade. Sign up for a 14-day trial today and see how it can change your trading — it’s only $7!

Is a Low-Float Stock

Any stock with less than 10 million shares publicly available for trading is considered a low-float stock. A smaller number of shares in play means that volume spikes can really move a stock’s price.

Exhibits an Unusual Trading Volume

Stocks trading at unusual volumes are more prone to price swings, which increase your chances of safely trading “the meat of the move.” Penny stock volume is important for another reason — high volume stocks are more liquid and easier to sell.

Is a Former Runner

A penny stock that’s run in the past has a better chance of running again in the future. Why?

  • It’s shown that it can run in reaction to the catalyst that made it run the first time
  • The market has a memory
  • Promoters also have a memory, and they’ll keep on pumping a hot stock until the worthless company it’s associated with goes out of business

Gets Frequent Media Attention

Breaking news stories and press releases about new technology solutions often lead to major price swings in tech penny stocks. Like we’ve already established, AI is a sector that gets a lot of news coverage.

Where to Buy AI Penny Stocks

You can buy AI penny stocks on major exchanges like the New York Stock Exchange (NYSE) and Nasdaq, as well as in the over-the-counter (OTC) markets. Most people trade penny stocks through broker websites and apps like Robinhood, Chase, and Wealthsimple Trade.

NYSE/Nasdaq Penny Stocks

You can find AI penny stocks among the tech giants listed on major exchanges like NYSE and Nasdaq. Listed stocks are more regulated than OTC stocks, and are generally perceived as more stable companies.

Most of the hot AI stocks are found on the Nasdaq. These stocks are generally more regulated and can offer a different kind of stability in the volatile world of penny stocks. Learn more about penny stocks on Nasdaq here.

OTC Penny Stocks

OTC or unlisted penny stocks fall into one of three tiers:

  • Pink sheet
  • OTCQB
  • OTCQX

Each OTC tier has different regulations and requirements. Pink sheets have little in the way of regulation, while OTCQX is more strictly regulated. That isn’t to say I won’t trade a pink sheet stock — I just won’t trust it.

Some AI stocks with the biggest potential for quick gains are found on the pink sheets. Of these, stocks under 10 cents are a distinct breed. These ultra-cheap stocks can be even more volatile, offering both higher risks and potentially higher rewards. If you’re looking to add some spice to your trading strategy, consider these options. Here’s a guide to penny stocks under 10 cents.

The Best Place to Buy Tech Penny Stocks

Are listed stocks better than unlisted, or vice versa? It depends on your risk appetite.

I trade both listed and unlisted stocks. I don’t see why I should limit myself.

How to Trade AI Penny Stocks

To start trading AI penny stocks, follow these guidelines:

  1. Set up a trading account: Choose a broker that offers access to penny stocks and supports trading automation.
  2. Choose the right trading platform: Look for platforms with robust research tools, low-cost trading options, and good user reviews.
  3. Understand trading fees: Be aware of all costs involved, including commission, spreads, and potential hidden fees.

Trading AI penny stocks requires a strategic approach. Technical analysis can help identify price patterns and trading opportunities. Fundamental analysis is essential to understand a company’s financial health and potential for growth. Staying informed about AI industry trends is crucial, as new developments can significantly impact stock prices. Drawing on years of trading experience, I’ve seen how crucial it is to stay updated with publications and reports on AI advancements to make informed trading decisions.

AI Stocks Under $5

Here are some of my top watches for AI penny stocks priced under $5:

  • Cyngn Inc (NASDAQ: CYN)
  • Nauticus Robotics Inc (NASDAQ: KITT)
  • BigBear.ai Holdings Inc (NYSE: BBAI)
  • Microbot Medical Inc (NASDAQ: MBOT)
  • Guardforce AI Co Ltd (NASDAQ: GFAI)

When I’m building my watchlist for AI penny stocks under $5, I look at the following factors. These factors don’t all matter when you’re trading penny stocks — but the perception of them does matter.

  • Growth potential: The company’s AI projects and innovations. Companies focusing on emerging AI technologies and automation can offer significant upside.
  • Financial health: The company’s balance sheet, revenue trends, and cash flow. A stable financial base is crucial for sustaining growth and weathering market volatility.
  • Market position: The company’s standing in the AI sector. Strong market positioning can indicate future success.
  • Management team: The company’s leadership. Research the backgrounds and track records of the key executives.
  • Industry trends: Broader AI industry trends. These are the biggest catalysts in penny stock land.

Some of the hottest AI penny stocks are in the biotech sector. Biotech is a great trading sector due to the potential for huge catalysts driven by successful clinical trials or FDA approvals. Like AI, trading biotech stocks requires staying informed about the latest developments in the industry. To identify high-potential biotech penny stocks, check out my monthly biotech penny stock watchlist.

AI Penny Stocks Under $10

Here are some AI stocks priced under $10:

  • Gaxos.AI Inc (NASDAQ: GXAI)
  • GSI Technology, Inc (NASDAQ: GSIT)
  • AXT Inc (NASDAQ: AXTI)
  • Airship AI Holdings Inc (NASDAQ: AISP)
  • SoundHound AI Inc (NASDAQ: SOUN)

Keeping an eye on companies involved in projects with buzz — sort of like Elon Musk’s Project Omega that we’ve been hearing about for years — can tip you off to future movements. Don’t give this hype a big position in your trading portfolios, but keep it on watch.

A robust penny stock watchlist should include a mix of stocks from various sectors to mitigate risks and capture opportunities across different markets. I don’t only watch AI stocks — I focus on any stock with strong growth potential. Regularly updating your watchlist and monitoring stock performance are crucial steps in staying ahead of the game. To see how I do it, check out my weekly penny stock watchlist.

Key Takeaways

Trading in AI penny stocks presents potential for profit, yet it’s crucial to keep an awareness of the risks involved. As traders, our approach isn’t about blindly pouring money into AI stocks. Instead, we focus on trading based on discernible patterns and deep market insights.

In trading, the small gains build over time. Don’t get swept away by the AI buzz; stay grounded in hard facts and observable market patterns. That’s the essence of trading AI penny stocks.

Key Considerations:

  • A lot of penny stocks are shady. Risk in AI penny stocks can be heightened due to limited company information and unsavory promotion.
  • There’s a possibility for big gains. With the AI sector’s potential for rapid advancement, these stocks can go supernova at any time.
  • The sector is young. AI penny stocks are impacted by technological innovations and developments, which can dramatically shift their market trajectory and valuation.

Artificial intelligence is one of the hottest sectors in trading, thanks to it being one of the hottest sectors in the popular imagination. The frequency of breaking news means there are bound to be opportunities for good trades.

Just because there are opportunities for trades doesn’t mean you will necessarily catch them. You have to be prepared. That means keeping a good watchlist, watching the market, and studying harder than all of the other traders trying to come out on top.

What are the AI penny stocks on YOUR watchlist? Let me know in the comments!

Frequently Asked Questions

How Should You Value AI Companies?

Valuing AI companies is a complex task that involves a deep dive into their financials, growth prospects, and market demand. Traditional metrics like earnings and revenue are important, but you also need to consider factors like data acquisition capabilities and the quality of their machine learning algorithms. From my experience, understanding the nuances of an AI company’s value can make or break your portfolio.

What AI Company Is Elon Musk Investing In?

Elon Musk recently launched xAI, billed as a ChatGPT alternative. Musk was a founding board member and investor in OpenAI, the company behind ChatGPT. He stepped away due to potential conflicts with Tesla’s AI development for self-driving cars.

How Do You Invest in the AI Industry?

Investing in the AI industry requires a well-thought-out strategy. You need to diversify your investments across various sectors like analytics, machine learning, and data security. You can use a mix of financial instruments like securities, equities, and even some options to balance out the risks and potential rewards.

What Information Can I Find in AI Articles?

By reading widely, you’ll find valuable information and insights related to artificial intelligence businesses and their customers. They often have content that contains various links to research and services, aimed to help you better understand this market.

What Determines the Market Cap of AI Penny Stocks?

The market cap of AI penny stocks is determined by a variety of factors including their momentum and results in the market. Monitoring these can give you an idea of their potential for profit.

How Can Services and Research Aid My Investment?

Services provide tools and platforms that can assist you in making informed decisions. The research, on the other hand, provides deeper insights into market trends, business models, and potential for profit, for stocks ranging from powerhouses like Tesla (TSLA), NVIDIA (NVDA), and Microsoft (MSFT) to penny stocks like AMST, POAI, and PBTS.

What Fundamentals Should I Look for in AI Penny Stocks?

Focus on low-cost, small-cap companies that show potential for high growth and innovation. Look for new ideas and technologies these companies are developing, and consider opinions and analyses from experts in the field to get a comprehensive understanding of the market. While AI penny stocks are primarily tech-focused, fluctuations in unrelated sectors, like crude oil, can still impact overall market sentiment and trading conditions.


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* Results are not typical and will vary from person to person. Making money trading stocks takes time, dedication, and hard work. There are inherent risks involved with investing in the stock market, including the loss of your investment. Past performance in the market is not indicative of future results. Any investment is at your own risk. See Terms of Service here

The available research on day trading suggests that most active traders lose money. Fees and overtrading are major contributors to these losses.

A 2000 study called “Trading is Hazardous to Your Wealth: The Common Stock Investment Performance of Individual Investors” evaluated 66,465 U.S. households that held stocks from 1991 to 1996. The households that traded most averaged an 11.4% annual return during a period where the overall market gained 17.9%. These lower returns were attributed to overconfidence.

A 2014 paper (revised 2019) titled “Learning Fast or Slow?” analyzed the complete transaction history of the Taiwan Stock Exchange between 1992 and 2006. It looked at the ongoing performance of day traders in this sample, and found that 97% of day traders can expect to lose money from trading, and more than 90% of all day trading volume can be traced to investors who predictably lose money. Additionally, it tied the behavior of gamblers and drivers who get more speeding tickets to overtrading, and cited studies showing that legalized gambling has an inverse effect on trading volume.

A 2019 research study (revised 2020) called “Day Trading for a Living?” observed 19,646 Brazilian futures contract traders who started day trading from 2013 to 2015, and recorded two years of their trading activity. The study authors found that 97% of traders with more than 300 days actively trading lost money, and only 1.1% earned more than the Brazilian minimum wage ($16 USD per day). They hypothesized that the greater returns shown in previous studies did not differentiate between frequent day traders and those who traded rarely, and that more frequent trading activity decreases the chance of profitability.

These studies show the wide variance of the available data on day trading profitability. One thing that seems clear from the research is that most day traders lose money .

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Citations for Disclaimer

Barber, Brad M. and Odean, Terrance, Trading is Hazardous to Your Wealth: The Common Stock Investment Performance of Individual Investors. Available at SSRN: “Day Trading for a Living?”

Barber, Brad M. and Lee, Yi-Tsung and Liu, Yu-Jane and Odean, Terrance and Zhang, Ke, Learning Fast or Slow? (May 28, 2019). Forthcoming: Review of Asset Pricing Studies, Available at SSRN: “https://ssrn.com/abstract=2535636”

Chague, Fernando and De-Losso, Rodrigo and Giovannetti, Bruno, Day Trading for a Living? (June 11, 2020). Available at SSRN: “https://ssrn.com/abstract=3423101”