How to Search for and Find Penny Stocks on Robinhood
Where to look for penny stocks in the Robinhood app
Robinhood does not have a dedicated penny stock filter or screener built into the app. To find stocks trading under $5, you search by ticker symbol or company name in the search bar at the top of the app, just as you would for any other stock. Once you land on a stock's page, you can see its current price, trading volume, and chart history.
The search function works the same way whether you are looking for Apple or a micro-cap stock. Type what you know — a company name, a ticker symbol, or even a partial name — and Robinhood returns matches. If you do not know the ticker, a web search for the company name plus "ticker symbol" will get you there faster than guessing in the app.
Robinhood does allow you to trade stocks priced below $1, though some brokers do not. The app will show you the bid-ask spread (the gap between what buyers will pay and what sellers are asking) before you place an order, which matters more with penny stocks because the spread is often wider.
Key Takeaways
- Robinhood has no built-in penny stock screener, so you must search by ticker symbol or company name in the app's search bar.
- Penny stocks on Robinhood often have wider bid-ask spreads than larger stocks, meaning the difference between buy and sell prices is larger.
- You can trade stocks under $1 on Robinhood, but you cannot place limit orders on stocks below $1 — only market orders.
- Third-party stock screeners and financial websites can help you identify penny stocks that meet certain criteria before you search for them on Robinhood.
- Penny stocks have lower liquidity, meaning fewer shares trade hands each day, so your order may take longer to fill or fill at a worse price than you expected.
Using third-party screeners to find penny stocks before searching Robinhood
Because Robinhood itself does not screen for penny stocks, most traders use external tools to narrow down their search first. Websites like Finviz, Yahoo Finance, and MarketWatch have free stock screeners where you can filter by price range, trading volume, market cap, and other metrics. You set the criteria — for example, "stocks between $1 and $5 with at least 1 million shares traded daily" — and the screener returns a list of tickers that match.
Once you have a list of ticker symbols from a screener, you then search each one in Robinhood to see the current price, chart, and bid-ask spread. This two-step process takes more time than a single search, but it lets you focus on stocks that meet your criteria rather than browsing randomly.
Some traders also follow penny stock forums, subreddits, or financial newsletters that highlight stocks under $5. These sources are not screeners — they are curated lists from other traders — so you should always verify the information independently before trading.
Understanding bid-ask spreads and liquidity on penny stocks
The bid-ask spread is the difference between what a buyer will pay (the bid) and what a seller is asking (the ask). On a large-cap stock like Microsoft, the spread might be a penny or less. On a penny stock, the spread can be 5 cents, 10 cents, or wider, which means you pay more to buy and receive less when you sell.
Robinhood shows you the bid-ask spread before you place an order. If a penny stock is bid at $2.50 and asked at $2.75, you will pay $2.75 to buy it immediately (a market order) and receive $2.50 if you sell it immediately. That $0.25 gap is your cost just to enter and exit the trade, separate from any price movement.
Liquidity — the number of shares trading hands each day — is lower for penny stocks. If a stock trades only 50,000 shares per day and you want to buy 100,000, your order may not fill completely, or it may fill at different prices as the stock moves. Robinhood will show you the average daily volume on a stock's page so you can see how many shares typically trade.
Order types and restrictions for penny stocks under $1
Robinhood allows market orders and limit orders on most penny stocks, but there is one important restriction: you cannot place a limit order on a stock trading below $1. You can only use a market order, which means you accept whatever price the market offers at the moment you buy or sell.
A market order on a sub-$1 stock is riskier because the price can move between the moment you tap "buy" and the moment your order fills. With a limit order, you set a maximum price you will pay (or a minimum price you will accept when selling), and the order only fills at that price or better. That protection is not available for stocks under $1 on Robinhood.
For stocks between $1 and $5, limit orders work normally. You can set a price and wait for the stock to reach it, or cancel the order if it does not.
How to evaluate penny stocks before you search on Robinhood
Before you search for a penny stock on Robinhood, spend time understanding what the company does, how much debt it carries, and whether it is profitable. Penny stocks are often young companies, companies in financial trouble, or companies in industries with high risk. The lower price does not mean the stock is a bargain — it often reflects real business problems.
Look at the company's most recent earnings report or quarterly filing (called a 10-Q for quarterly reports and a 10-K for annual reports). These are free on the SEC website at sec.gov. Read the "Risk Factors" section, which lists what could go wrong. If a company is burning cash and has no clear path to profit, the stock price may fall further.
Check the trading volume and bid-ask spread on the stock's Robinhood page. If volume is very low (under 100,000 shares per day) and the spread is very wide, you may struggle to buy or sell at a fair price. A stock can be cheap and still be a poor trade if you cannot move in and out of it easily.
Common mistakes when searching for penny stocks on Robinhood
One common mistake is confusing low price with low risk. A $2 stock is not safer than a $50 stock just because it costs less. In fact, penny stocks are often riskier because they have less trading volume, less analyst coverage, and less public information.
Another mistake is buying a penny stock without checking the bid-ask spread first. You might see a stock quoted at $3.00 and assume you can buy at that price, but if the bid is $2.90 and the ask is $3.20, you will actually pay $3.20 to buy it. Robinhood shows this before you confirm your order, so read it carefully.
A third mistake is treating penny stocks like lottery tickets. Some traders buy dozens of different penny stocks hoping one will spike 10 times in value. Most will not. A diversified approach — owning a mix of stocks and funds rather than betting heavily on one or two penny stocks — reduces the risk that a single bad pick wipes out your gains.
Frequently Asked Questions
Can I set up alerts on Robinhood for penny stocks?
Robinhood does not have a built-in alert feature. You can check a stock's price manually in the app, or use a third-party service like TradingView or Yahoo Finance to set price alerts that notify you by email or text when a stock reaches a certain price.
Does Robinhood charge extra fees to trade penny stocks?
No. Robinhood charges no commission on stock trades, whether the stock is a penny stock or a large-cap stock. However, you still pay the bid-ask spread, which is wider on penny stocks, so your effective cost is higher.
What is the minimum amount I need to buy a penny stock on Robinhood?
You can buy as little as one share of any stock on Robinhood, including penny stocks. If a stock costs $2 per share, you can buy one share for $2. There is no minimum dollar amount to open an account or place a trade.
Why does Robinhood not have a penny stock screener?
Robinhood is designed for casual investors and does not offer advanced research tools. The app focuses on ease of use and low costs rather than professional-grade analysis. Traders who want to screen for penny stocks use dedicated financial websites instead.