| Pink Sheets is where most of the penny stocks get | | | | won't to divulge much to the market. Since most of |
| traded. However, this small market is just like the | | | | them are embarking on a new business venture, they |
| Wild West with no rules and no oversight. Do you | | | | want the market to keep on guessing. Telling the |
| want to take part in this exciting small market than | | | | market everything at this stage can be detrimental |
| you should first do your due diligence and research | | | | to their future prospects. But this lack of information |
| before you decide to take the plunge. | | | | about these companies makes many investors |
| There are no rules on these Pink Sheets as I have | | | | nervous about them and forces them to stay away |
| said before. So, companies that get their penny | | | | from investing in Pink Sheets Penny Stocks. |
| stocks traded on them have no compulsion to | | | | There is another complication on these Pink Sheets. |
| disclose any of their financial statements or issue | | | | Many market makers on these sheets charge high |
| even their annual reports. Many companies that get | | | | spreads. For example, the bid price of a penny stock |
| listed on these sheets have no ultimate desire to | | | | maybe something like $0.05 but the ask price of that |
| move on to the bigger markets like OTCBB (Over | | | | same penny stock maybe $0.25. This spread of $0.2 |
| The Counter Bulletin Board), NASDAQ or even NYSE. | | | | between the bid and ask is meant o discourage |
| Many may even have no on going concerns. | | | | buyers from that penny stock. But why? The reason |
| Now, don't take this to mean that most of these | | | | is this that if that penny stock has a thin market and |
| companies are just mom and pop stores | | | | the market maker is afraid that he will be stuck up |
| masquerading as companies. There are something like | | | | with that stock for a long time, the market maker |
| 20,000 stocks listed on these pink sheets. These | | | | will try to charge a high spread. |
| companies have their own reasons to stay on these | | | | But, you can still find many penny stocks on these |
| sheets. | | | | pink sheets that have a spread of only one cent. So, |
| The reason for this can be the company's desire for | | | | as an investor if you want trade penny stocks listed |
| privacy. Getting listed on OTCBB may cause a loss of | | | | on these pink sheets do your research, you many |
| privacy for these companies as SEC requires to | | | | find many hidden gems. Most of these penny stocks |
| know exactly how each executive is being | | | | have been beaten down to such a low price that |
| compensated and how the company owns assets. | | | | they get traded below their book value. So don't |
| Now most of these companies that are listed on Pink | | | | hesitate to take part in this exciting opportunity. Just |
| Sheets are in their startup phase meaning they don't | | | | do your research and due diligence! |