Penny Stock Basics
What is the "Over-the-Counter" (OTC) market?
Stocks that do not trade on recognized national stock exchanges, such as the New York Stock exchange American Stock Exchange trade in markets described as "over-the-counter" (OTC).
The OTC market is less stringent than national exchanges when it comes to matters such as listing requirements and clarity of investor information. The OTC market exists primarily to give small companies access to public investor capital.
What Is The OTC Bulletin Board?
The OTCBB is an acronym for the Over-the-Counter Bulletin Board. This OTC bulletin Board is described is an electronic quotation system for small companies.
This Electronic Quote System displays Bid, Ask and daily volume to subscribing Broker-Dealers.
Are There Any Minimum Listing Standards That Must Be Met In Order To List On The NASDAQ OTCBB Bulletin Board?
The only requirement the OTCBB requires for companies to be fully reporting with the SEC. All filings can be viewed on the SEC EDGAR system.
What Are The Pink Sheets?
The Pink Sheets, like the Over-the-Counter-Bulletin Board (OTCBB), is an electronic quotation system. The Pink Sheets present quotes from broker dealers for many over-the-counter (OTC) securities. The Pink Sheets are useful for brokers to publish their bid and ask quotation prices.
A privately owned company, Pink Sheets LLC, publish the Pink Sheets. The Pink Sheets electronic quotation system is not registered with the Securities Exchange Commission (SEC) and neither is the company a broker-dealer of the Financial industry Regulatory Authority . (FINRA).
The Pink Sheets used to be published daily on pink paper and distributed to broker-dealers. This is where the name Pink Sheets originated. Since the electronic age the distribution of printed pages has ceased and all quotation information is available on line.
Are There Any Listing Requirements To List In The Pink Sheets?
Pink Sheets listing requirements are very minimal. Some disclosure must be made before listing but it is virtually non-existent.