Jasmine Birtles
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Best Performing Penny Stocks to Buy in March 2025
Ruby Layram
21st Mar 2025
Penny stocks are ‘cheap’ stocks that provide investors with an opportunity to buy lots of stocks without needing to invest huge amounts of money. These stocks often come with a lot of room for growth, which makes them a pretty exciting investment!
In the past, penny stocks have provided lucky investors with lucrative returns – we’ve all heard the fairytales of millionaires who made their wealth through a stroke of luck that led them to invest in a penny stock before it grew substantially.
Of course, not all penny stocks offer such exhilarating returns. However, adding them to your portfolio could be a good way to diversify away from blue chips.
In this post, we will take a look at the best-performing penny stocks for UK investors in March 2025.
What Are Penny Stocks?
Penny stocks refer to shares of small companies that trade at low prices, typically under £1 in the UK.
They often belong to firms with smaller market capitalisations and may not be listed on major stock exchanges.
Due to their low price, penny stocks can be highly volatile and carry a higher risk compared to more established companies.
Why Invest in Penny Stocks?
Investors are drawn to penny stocks for several reasons:
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High growth potential: Small companies have the capacity for rapid expansion, leading to substantial returns if successful.
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Low capital requirement: The low share price allows investors to acquire a significant number of shares with a relatively modest investment.
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Diversification: Including penny stocks in a portfolio can provide exposure to emerging sectors and innovative businesses.
However, it’s crucial to remember that with higher potential rewards come higher risks. Penny stocks can be less liquid and more susceptible to significant price fluctuations.
Top UK Penny Stocks Between January and March 2025
Based on recent market analyses, here are some UK penny stocks that have shown notable performance in early 2025:
1. Begbies Traynor Group (LSE: BEG)
Begbies Traynor Group, a professional services consultancy specialising in corporate restructuring and insolvency, has experienced a positive trajectory over the last month (rising by over 5%).
The company’s expertise in navigating financial distress has positioned it well during economic fluctuations, leading to increased demand for its services.
This is a good example of a company that has the potential to do well when other areas of the market are struggling.
Your money is at risk.
2. Serabi Gold (LSE: SRB)
Serabi Gold, a gold mining company operating in Brazil, has benefited from rising gold prices and improved production efficiencies.
The company’s focus on high-quality projects and cost-effective operations has contributed to its strong performance.
Over the last 6 months, the stock has grown by 68% – an impressive return for lucky investors who bought the stock this time last year!
Your money is at risk.
3. Polar Capital Holdings (AIM: POLR)
Polar Capital Holdings plc is a UK-based company that manages investments for clients. It has shown strong growth, making it an interesting option for investors in March 2025.
By 31 March 2024, the company’s total assets under management (AUM) had grown by 14%, increasing from £19.2 billion to £21.9 billion. This means more investors are trusting Polar Capital with their money, which highlights its strong position in the market.
Your money is at risk.
Tips for Investing in Penny Stocks
If you’re considering investing in penny stocks, there are a few important things to keep in mind:
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Conduct thorough research: Investigate the company’s financial health, management team, and industry trends.
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Diversify your portfolio: Don’t put all your funds into one penny stock; spread your investments to mitigate risk.
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Be prepared for volatility: Penny stocks can experience rapid price changes. Invest only what you can afford to lose.
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Use limit orders: Given the low liquidity of some penny stocks, using limit orders can help you control the price at which you buy or sell shares.
Investing in penny stocks requires careful consideration and a willingness to accept higher risks for the possibility of higher rewards. By staying informed and approaching these investments cautiously, you can navigate the penny stock landscape more effectively.
Final Thoughts
In my opinion, penny stocks are only as good as the foundations of the companies behind them (the same goes for all stocks!). Just because a stock has performed well over the last 3-6 months, doesn’t mean that it will continue an upward trajectory.
Before you get excited and buy penny stocks, conduct a thorough fundamental analysis (a fancy term for looking into the underlying company fundamentals.)
A better idea might be to invest in an index fund that tracks penny stocks – the UK AIM index is good for this.
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Disclaimer: MoneyMagpie is not a licensed financial advisor and therefore information found here including opinions, commentary, suggestions or strategies are for informational, entertainment or educational purposes only. This should not be considered as financial advice. Anyone thinking of investing should conduct their own due diligence. When investing your capital is at risk.
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