: Look for companies with low debt-to-equity ratios and positive cash flow . Tools like the Tickertape Stock Screener allow you to filter for "Fundamentally Strong" penny stocks.

: Never invest more than 1% to 2% of your total portfolio in a single penny stock.

: Check if the company's founders (promoters) still hold a large stake. High promoter holding indicates leadership believes in the company’s future. 3. Execution and Risk Management

: Always set a "stop-loss" to automatically sell your shares if the price drops below a certain point (e.g., 10% down), protecting you from a total crash.