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43-489: (Redirected from Pink Sheets ) Pink sheet or Pink Sheets may refer to: "Pink sheet trading" (or " over-the-counter trading ") directly between two parties, rather than through a broker Pink Sheets LLC , a private company that offers real-time quotation service for the stocks listed in the over-the-counter market Flyers handed out in the 1950 California Senate election campaign Results from individual polling stations in

86-529: A narrow range of quantity, quality, and identity which is defined by the exchange and identical to all transactions of that product. This is necessary for there to be transparency in stock exchange-based equities trading. The OTC market does not have this limitation. Parties may agree on an unusual quantity, for example in OTC, market contracts are bilateral (i.e. the contract is only between two parties), and each party could have credit risk concerns with respect to

129-586: A network of 89 broker-dealers price and trade a wide spectrum of securities on the OTC Markets platform. To be quoted on the platform, companies are not required to file with the SEC , although many choose to do so. A wide range of companies are quoted on OTC Markets, including firmly established foreign firms, mostly through American depositary receipts (ADRs). In addition, many closely held, extremely small and thinly traded U.S. companies have their primary trading on

172-408: A qualitative review by OTC Markets Group. Companies are not required to be registered with or reporting to the SEC, but they must post financial information with OTC Markets Group. In addition, U.S. companies must be ongoing operations (i.e., no shells ) and may not be in bankruptcy, while foreign issuers must meet the requirements of qualified foreign exchanges. Additional oversight of OTCQX securities

215-613: A spam campaign, any stock that is not in the Current Information category will also have its quotes blocked on otcmarkets.com. The SEC requires broker-dealers to comply with Exchange Act Rule 15c2-11 before displaying quotes on OTC securities, and requires submission of Form 211 to the FINRA OTC Compliance Unit. In 2019, amendments were proposed to 15c2-11, which had not been significantly amended since 1991. FINRA Rule 6500 contains rules on quoting OTC securities on

258-477: Is a bilateral contract in which two parties (or their brokers or bankers as intermediaries) agree on how a particular trade or agreement is to be settled in the future. It is usually from an investment bank to its clients directly. Forwards and swaps are prime examples of such contracts. It is mostly done online or by telephone. For derivatives , these agreements are usually governed by an International Swaps and Derivatives Association agreement. This segment of

301-735: Is also called OTOTC or Other OTC. As of October 18, 2023 , there were 1,426 securities in the grey market. The Compliance Analytics Product creates a security specific risk score for all OTCQX, OTCQB, Pink and Grey securities. Risk is assessed over 19 parameters including caveat emptor, shell status, penny stock status, price/volume changes and stock promotion data. Recently, the product integrated "Hot Sector" information about cannabis, cryptocurrency and blockchain. The Promotion Data Product provides market professionals and investors with active and historical promotion data for OTCQX, OTCQB, Pink and Grey securities. The company calculates and licenses indices of securities that trade on one of

344-785: Is an annual fee for the OTCQB market of $ 12,000 per year and a one-time $ 2,500 application fee. As of October 18, 2023 , 1,216 securities were available for trading on the OTCQB exchange. As of November 2018, the OTCQX Market has Blue Sky status in 33 states and the OTCQB Market in 30 states. Blue sky laws are state regulations established as safeguards for investors against securities fraud. The laws, which may vary by state, typically require sellers of new issues to register their offerings and provide financial details. This allows investors to base their judgments on verifiable information. Since

387-446: Is different from Wikidata All article disambiguation pages All disambiguation pages Over-the-counter (finance) OTC trading, as well as exchange trading, occurs with commodities , financial instruments (including stocks ), and derivatives of such products. Products traded on traditional stock exchanges, and other regulated bourse platforms, must be well standardized. This means that exchanged deliverables match

430-514: Is more information about a company's ownership structure, professional advisors and service providers. This certification will be required for any security newly qualified to be publicly quoted by a broker-dealer under SEC Rule 15c2-11, or when a Pink traded company becomes a current SEC reporting company, beginning May 1, 2014. International Reporting companies are also allowed to upgrade from Pink to OTCQB if they publish their 12g3-2(b) compliant disclosure online and verify their company profile. There

473-496: Is provided by requiring every issuer to be sponsored by approved third-party investment banks or law firms , called OTCQX Sponsors. As of October 18, 2023 , 658 securities were available for trading on the OTCQX exchange, 478 of these being international companies and 180 of these being U.S. companies. The OTCQB market contains a one penny ($ 0.01) bid price requirement "intended to remove companies that are most likely to be

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516-543: The 2012 Ghanaian general election See also [ edit ] Pink slip (disambiguation) Topics referred to by the same term [REDACTED] This disambiguation page lists articles associated with the title Pink sheet . If an internal link led you here, you may wish to change the link to point directly to the intended article. Retrieved from " https://en.wikipedia.org/w/index.php?title=Pink_sheet&oldid=1081084968 " Category : Disambiguation pages Hidden categories: Short description

559-533: The International Swaps and Derivatives Association examined OTC Derivative Bilateral Collateralization Practice as one way of mitigating risk. OTC derivatives are a significant part of the world of global finance. The OTC derivatives markets grew exponentially from 1980 through 2000. This expansion has been driven by interest rate products, foreign exchange instruments and credit default swaps. The notional outstanding of OTC derivatives markets rose throughout

602-560: The OTCQX stocks (traded through the OTC Market Group Inc). Other OTC stocks have no reporting requirements, for example Pink Sheets securities and "gray market" stocks. However, in 2021, the pink sheets market came under the spotlight of greater regulatory scrutiny. Some companies, with Wal-Mart as one of the largest, began trading as OTC stocks and eventually upgraded to a listing on fully regulated market. By 1969 Wal-Mart Stores Inc.

645-521: The OTC Markets platform. Many foreign issuers adhere to the listing requirements of qualified foreign stock exchanges and make their home country disclosure available in English. There are also a significant number of U.S.-based issuers who are current in their reporting to regulators such as the U.S. Securities and Exchange Commission (SEC) or make available ongoing quarterly and audited annual financial reports through OTC Markets Group. Many companies in

688-417: The OTC market is occasionally referred to as the " Fourth Market ". Critics have labelled the OTC market as the "dark market" because prices are often unpublished and unregulated. Over-the-counter derivatives are especially important for hedging risk in that they can be used to create a "perfect hedge". With exchange traded contracts, standardization does not allow for as much flexibility to hedge risk because

731-460: The OTCBB, but the OTCBB has diminished in importance and by 2016 less than 2% of OTC trades occurred on the OTCBB, as opposed to OTC Markets. In 2014, FINRA proposed to remove Rule 6500 and eliminate the OTCBB, but withdrew the rule and in 2016 proposed to update the OTCBB to provide a backup system in case quotation is disrupted or nonexistent. Other FINRA rules such as Rule 6432 and Rule 5250 relate to

774-600: The OTCQX and OTCQB therefore are of Status to meet or exceed the Blue Sky standards of the respective states. Pink is an open market that has low financial standards or reporting requirements. The stock of companies in the Pink tier are not required to be registered with the SEC. Companies in this category are further categorized by the level and timeliness of information they provide to investors and may have current or limited public disclosure. These were both glamorized and denigrated in

817-529: The Pink market tier of the OTC categorization system do not meet the United States' listing requirements for trading on a stock exchange such as the New York Stock Exchange or NASDAQ . Many of these issuers do not file periodic reports or make available audited financial statements , making it very difficult for investors to find reliable, unbiased information about those companies. For these reasons

860-614: The SEC Rule 15c2-11; for example, Rule 5250 prohibits market makers from receiving compensation from issuers. Many of the stocks traded OTC are microcap stocks , also known as penny stocks , which are known for fraudulent microcap stock fraud and penny stock scams . After the passage of Sarbanes-Oxley Act in 2002, some companies delisted and became OTC to save costs and avoid certain regulations, although OTC companies have faced pressure to improve disclosure. The OTC Bulletin Board (OTCBB)

903-444: The SEC for the purpose of determining the public market price when registering securities for resale with the SEC in equity line financings. OTC Markets Group can facilitate electronic trading with its SEC-registered Alternative Trading System known as OTC Link ATS. The OTCQX market includes both multinational companies seeking access to U.S. investors, and domestic growth companies. To be traded on this tier, companies must undergo

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946-501: The SEC recognized OTCQX and OTCQB as established public markets, OTC Markets Group has worked collaboratively with state regulators since the 2014 JOBS ACT to apprise them of the easily accessible, free, public online disclosure of current information provided by companies traded on the OTCQX and OTCQB premium markets. As of April 2018, 60% of the 50 states now acknowledge the OTCQX Market for the purposes of secondary trading exemptions. The investor protection and quality control standards of

989-542: The SEC views many of the lower-tier companies traded on OTC Markets as "among the most risky investments " and advises potential investors to heavily research the companies in which they plan to invest. Securities trading on the OTCQB and higher-tiered OTCQX trading marketplaces have status of Blue Sky secondary trading exemptions in 33 states and brokers may recommend such securities to their clients like securities listed on national stock exchanges. OTC Markets Group designates securities in one of three markets to indicate

1032-595: The United States, over-the-counter trading in stock is carried out by market makers using inter-dealer quotation services such as OTC Link (a service offered by OTC Markets Group ). Although exchange-listed stocks can be traded OTC on the third market , it is rarely the case. Usually OTC stocks are not listed nor traded on exchanges, and vice versa. Stocks quoted on the OTCBB must comply with certain limited U.S. Securities and Exchange Commission (SEC) reporting requirements. The SEC imposes more stringent financial and reporting requirements on other OTC stocks, specifically

1075-459: The ability to profit from OTC derivatives activities and financial markets participants benefitted from them. In 2000 the authors acknowledged that the growth in OTC transactions "in many ways made possible, the modernization of commercial and investment banking and the globalization of finance". However, in September, an IMF team led by Mathieson and Schinasi cautioned that "episodes of turbulence" in

1118-420: The contract is a one-size-fits-all instrument. With OTC derivatives, though, a firm can tailor the contract specifications to best suit its risk exposure. OTC derivatives can lead to significant risks. Especially counterparty risk has gained particular emphasis due to the credit crisis in 2007 . Counterparty risk is the risk that a counterparty in a derivatives transaction will default prior to expiration of

1161-432: The end of 2012 totalled US$ 346.4 trillion . The Bank for International Settlements statistics on OTC derivatives markets showed that "notional amounts outstanding totalled $ 693 trillion at the end of June 2013... The gross market value of OTC derivatives – that is, the cost of replacing all outstanding contracts at current market prices – declined between end-2012 and end-June 2013, from $ 25 trillion to $ 20 trillion." In

1204-399: The exception of large, established foreign firms". Reputable companies located outside the U.S., he notes, sometimes sell stock over-the-counter to gain access to American markets while avoiding the expense of keeping two sets of audited paperwork to be listed on multiple stock exchanges (one in their homeland or to international standards, and one for American standards). An over-the-counter

1247-484: The film The Wolf of Wall Street . Companies submitting regular Quarterly and Annual Reports go into the Current category. This category can still include shell companies or development stage companies with little or no operations as well as companies without audited financial statements . Companies in this category must not only have Quarterly reports duly posted every three months, but most have Annual reports for at least

1290-707: The late 1990s "revealed the risks posed to market stability originated in features of OTC derivatives instruments and markets. OTC Markets Group OTC Markets Group, Inc. (formerly known as National Quotation Bureau , Pink Sheets , and Pink OTC Markets ) is an American financial services corporation that operates a financial market providing price and liquidity information for almost 12,400 over-the-counter (OTC) securities. The group has its headquarters in New York City . OTC-traded securities are organized into three markets to inform investors of opportunities and risks: OTCQX , OTCQB and Pink . The company

1333-748: The level of financial and corporate disclosure provided by the companies using its quotation system. Apart from the OTCQX market, which has rules that include financial requirements, the designations do not signify issuer quality or merit of any security. Designation is based on the level and timeliness of a company's disclosure and OTCQB and any of the Pink categories can include both high quality as well as speculative, distressed, or questionable companies. Strict promotion policies have been enacted to flag these companies and deny their application for trading if they engage actively in campaigns marked by misleading information or manipulative promotions. The OTCQX and OTCQB markets are considered 'Established Public Markets' by

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1376-450: The needs of automated broker-dealers. The OTCBB was shut down on November 8, 2021. Securities that are not listed on any stock exchange nor formally quoted on OTC Markets or OTCBB are considered to be in the grey market . Unsolicited transactions are processed independently and not centrally listed or quoted. Trades are reported to a self-regulatory organization (SRO), which then passes the data on to market data companies. The grey market

1419-437: The other party. The OTC derivative market is significant in some asset classes: interest rate , foreign exchange , stocks , and commodities . In 2008, approximately 16% of all U.S. stock trades were "off-exchange trading"; by April 2014, that number increased to about 40%. Although the notional amount outstanding of OTC derivatives in late 2012 had declined 3.3% over the previous year, the volume of cleared transactions at

1462-541: The period and totalled approximately US$ 601 trillion at December 31, 2010. In their 2000 paper by Schinasi et al. published by the International Monetary Fund in 2001, the authors observed that the increase in OTC derivatives transactions would have been impossible "without the dramatic advances in information and computer technologies" that occurred from 1980 to 2000. During that time, major internationally active financial institutions significantly increased

1505-875: The preceding two years on file. As of October 18, 2023 , there were 6,705 securities under Pink Current. Companies that have submitted information no older than six months to the OTC Markets data and news service or have made a filing on the SEC's EDGAR system in the previous six months are rated as having limited information. Companies that are unwilling or unable to meet OTC Markets' Guidelines for Providing Adequate Current Information with Quarterly and Annual Reports every three months, but which still submit information at least every six months, are in this category. These are often companies with financial reporting problems, economic distress, or in bankruptcy . As of October 18, 2023 , there were 3,684 securities under Pink Limited. This market indicates companies that are unwilling or unable to provide disclosure to

1548-536: The public markets. Companies in this category do not make current information available via OTC Markets disclosure and news service, or if they do, the available information is older than six months. This category includes defunct companies that have ceased operations as well as "dark" companies with questionable management and market disclosure practices. Securities of publicly traded companies that are not willing to provide information to investors are considered highly risky. Quotations for stocks in this tier are hidden from

1591-568: The public. This tier was formerly known as the Pink No Information tier. As of October 18, 2023 , there were 3,342 securities in the Expert Market. There is a public interest concern associated with the company designated as "Caveat Emptor" (Latin for "buyer beware"). This may include a spam campaign, stock promotion or known investigation of fraudulent activity committed by the company or through inside information . During

1634-492: The share of their earnings from derivatives activities. These institutions manage portfolios of derivatives involving tens of thousands of positions and aggregate global turnover over $ 1 trillion. At that time prior to the financial crisis of 2008, the OTC market was an informal network of bilateral counter-party relationships and dynamic, time-varying credit exposures whose size and distribution tied to important asset markets. International financial institutions increasingly nurtured

1677-422: The subject of dilutive stock fraud schemes and promotions". Each company verifies via an annual OTCQB Certification, signed by the company CEO or CFO, that their company information is current, including information about a company's reporting status, company profile, information on management and boards, major shareholders, law firms , transfer agents , and IR / PR firms. Investor confidence improves when there

1720-476: The trade and will not make the current and future payments required by the contract. There are many ways to limit counterparty risk. One of them focuses on controlling credit exposure with diversification , netting , collateralisation and hedging . Central counterparty clearing of OTC trades has become more common in recent years, with regulators placing pressure on the OTC markets to clear and display trades openly. In their market review published in 2010,

1763-765: Was first established in 1913 as the National Quotation Bureau (NQB). For decades, the NQB reported quotations for both stocks and bonds, publishing the quotations in the paper-based Pink Sheets and Yellow Sheets respectively. The publications were named for the color of paper on which they were printed. NQB was owned by CCH from 1963 to 1993. In September 1999, the NQB introduced the real-time Electronic Quotation Service. The National Quotation Bureau changed its name to Pink Sheets LLC in 2000 and subsequently to Pink OTC Markets in 2008. The company eventually changed to its current name, OTC Markets Group , in 2010. Currently,

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1806-610: Was incorporated. In 1972, with stores in five states, including Arkansas, Kansas, Louisiana, Oklahoma and Missouri, Wal-Mart began trading as over-the-counter (OTC) stocks. By 1972 Walmart had earned over US$ 1 billion in sales — the fastest company to ever accomplish this. In 1972 Wal-Mart was listed on the New York Stock Exchange (NYSE) under the ticker symbol WMT. In Kiplinger in 2017, Dan Burrows wrote that American OTC markets are rife with penny stock fraud and other risks, and should generally be avoided by investors "with

1849-465: Was only a listing of securities that are also traded "over the counter" similar to the OTC Markets. The OTCBB has diminished in importance, with very little activity, but was previously retained as possible last resort system in case of disruption. OTCBB companies were required to file timely reports to a U.S. regulatory agency. Almost all OTCBB companies are now quoted via OTC Markets' OTC Link ATS because its fully electronic trading platform better meets

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