|
There are two exchanges in which penny stocks are traded. One is the Pink Sheets and the other is the OTC Bulletin Board. Where any company can list themselves on the Pink Sheets without meeting any particular requirements, the OTC Bulletin Board differs just a little bit in several ways. First of all, the Pink Sheets usually consist of small startup companies with no sales. The OTC Bulletin Board, on the other hand, consists of young companies who many not have sales, but the OTC Bulletin Board is more likely to have companies with sales listed upon it.
Companies traded on the OTC Bulletin Board tend to be fully reporting companies. This means that they will reveal what their balance sheets consist of and how many outstanding shares they have. Many times, the OTC Bulletin Board is the next step for penny stocks companies who want to either be semi-reporting companies or fully reporting companies.
The encouraging news is that when looking at the major stock exchanges such as the NYSE and the NASDAQ, there are many companies that started out as penny stocks listed on pink sheets or on the OTC Bulletin Board. Although it is rare to become the next Google, Google proved that it was possible to start out with nothing and become everything. Companies are striving for that every single day although that type of success is hardly seen. Microsoft, on the other hand, actually started out with shares in the moderate price range when they started being traded on the markets. They weren’t listed on Pink Sheets or the OTC bulletin board like some may want to think.
It is once a company moves from the Pink Sheets to the OTC Bulletin Board that penny stocks investors will start looking at them seriously. If the companies are reporting a profit and their shares are climbing in value, then they are going to be a part of the trading game in no time. They are going to be watched, studied, and more or less stalked by those who feel that what the company has to offer is going to result in a great surge in stock price. This is some of the advantages of being listed on the OTC Bulletin Board and should be a great feeling when being able to report on their sales and if there are any outstanding stocks.
Once a company succeeds on the OTC Bulletin Board and their shares go beyond what is considered to be a penny stock (over $5 per share), they can then start looking at the larger exchanges and strive to become one of the sought after companies. If they can do this and do it quickly, then they could possibly be the next Google, but it takes a lot of hard work.
We strongly recommend that you consult with a registered investment adviser before investing in any stocks. |
