Basic stocks question?

1. No. If you owned $250 of stock and the price doubled you would have $500 in the end but have only made $250 in profit.

2. Yes

3. A starting price is not necessarily a good indicator of future returns. There is no reason a $2 stock price should double any more than a $10 stock price should double. The number of shares that you own is irrelevant. What matters is the price performance.

An apples to apples comparison would be this:

Example A: With $300 you buy 10 shares of Company A trading at $30. Overnight a larger company announces a takeover and the shares start trading at $60. You now have $600 and have doubled your money.

Example B. With $300 you buy 100 shares of Company B trading at $3. Overnight a buyout is announced and the share price doubles to $6. You now have $600 and have doubled your money.

The percentage move in the stocks is the same and your return is the same buy you own 10 times as many shares of Company B as Company A.

In the end it's the percentage change in the price of the stock that matters for your return.

Penny stocks (stocks trading under $5) is the worst place for a new trader to start. You should spend years (3-5) trading higher priced stocks (successfully) before getting into penny stocks.

You should start your journey into trading by reading several books. Not learning the basics will hurt you financially.

Penny stocks can move very fast. Most of them are priced under $5 because they have significant problems or are simply not profitable. With many penny stocks 1-10 people can effect the price. The price can go up 10%.... and a minute later you can sell your shares & have a 25% loss (as an example).

Suggesting or thinking the prices move "safely" is totally wrong & will eventually kill your portfolio.

Because lower price stocks very rarely go up by 100%, as in your example of the $2.00 stock. However, a $150 stock is very likely to increase by $2 (1.5%).

But you are coming to a realisation that higher value stocks do not move by much. That is why traders (as opposed to investors) use derivatives such as options or CFDs, to leverage their income.

Not much to add, except to say that you need to know why you are buying a stock, no matter what the price is.

Another good rule of thumb -> "When it doubles, sell half, when it triples sell the rest"