This week, I've been working on a list of penny stocks to buy. Given that any recovery is likely to be led by the small-cap space, I'm looking closely at the smallest of the small to drive my portfolio higher.

Not for the faint of heart, these so-called penny stocks can generate some really fat returns. I'm not talking about just doubling your money here. Stories abound of returns of 300% or much more on stocks that started out trading for less than $5 per share.

One of the stocks on my list is in the poker space, and to give you a bit of a preview, I want to visit one other player in the space that was worthy of consideration, but did not make the final list.

CryptoLogic (NASDAQ: CRYP) is a leading provider of software for the Internet gaming space for non-U.S. players. It is that last piece about non-U.S. players that has me quite excited about the stock.

The company has benefited from the explosion of online poker playing, but stagnated due to tough enforcement of rules and regulations against U.S. players. It is illegal to gamble online, and that is a huge problem for companies like CRYP.

My take on this stock is that regulations will change for a few reasons. At the top of the list is a new administration that claims to bring a non-lobby-based form of governing to Washington.

That means the Vegas lobby is out of luck when it comes to online gaming. Every other modern country allows it, why not ours?

Another big plus is the taxable revenue that would come from legalizing online gaming. Given the economy and massive debt loads, one would think this would make sense.

I think the space makes for a reasonable speculation, and CRYP looks like a strong play in my opinion.

With shares at $2 and change, off a 52-week high of $21.97, there is plenty of fuel here.

Of course, there is risk, but that's what penny stocks are all about.

I am merely suggesting that there is a legitimate trigger here for some serious upside. Sometimes that's all it takes for a penny stock like CRYP to take off.

And if you're interested in penny stocks, be sure to check out my Top 5 Penny Stocks to Buy Now.

Jamie Dlugosch is a contributor to InvestorPlace.com.

The Walt Disney Co. (NYSE: DIS) made the news a couple of times this week.

According to our sister blog Gadling, the water ride "It's a Small World" in Disneyland has been malfunctioning. Apparently, some tourist-laden boats have come to a standstill, trapped against the bottom of the pool. The company blames poor repair practices, rather than the nation's swelling waistline, for the problem. So don't worry about that fried Snickers you ate while waiting in line.

On a more serious note, also from Gadling: Disneyworld has come under criticism for its decision to ban Segways from the park. Evidently, some mobility-limited visitors use Segways rather than other wheeled vehicles to compensate for their limitations, and feel the policy violates their rights under the Americans with Disabilities Act.

Finally, a warning to online poker players. Perhaps you remember when Deep Blue, the IBM chess-playing computer, beat world champion Gary Kasparov? According to Ian Ayers on the Freakonomics blog in the New York Times, poker-playing computers are now so advanced that we bags of mostly water don't stand a chance against them. As I see it, your only choice now is to get your own computer, or deal yourself out of online gaming.

Thanks to Boing Boing for the link.