Pink Sheets 1897847 226028724 2008-07-16T14:40:20Z Austinmurphy 1781508 more clear {{Mergefrom|Pink OTC Markets|date=July 2008}} The '''Pink Sheets''' is an electronic quotation system, operated by [[Pink OTC Markets]], that displays quotes from [[broker-dealer]]s for many [[Over-the-counter (finance)|over-the-counter]] securities. [[Market makers]] and other brokers can use the Pink Sheets to publish their bid and ask quotation prices. The name "Pink Sheets" comes from the color of paper the quotes were printed on prior to the electronic system, then published by the National Quotation Bureau. The Pink Sheets is not a [[stock exchange]]. To be quoted in the Pink Sheets, [[company (law)|companies]] do not need to fulfill any requirements (e.g. [[SEC filing|filing]] [[financial statements]] with the SEC). With the exception of a few [[issuer|foreign issuers]] (mostly represented by [[American Depositary Receipt]]s, or ADRs), the companies quoted in the Pink Sheets tend to be closely held, extremely small, or thinly [[trader (finance)|traded]]. Most do not meet the minimum [http://www.sec.gov/answers/listing.htm U.S. listing requirements] for trading on a [[stock exchange]] such as the [[New York Stock Exchange]]. Many of these companies do not file periodic reports or [[audit]]ed [[financial statements]] with the SEC, making it very difficult for [[investment|investors]] to find reliable, unbiased information about those companies. For these reasons the SEC views companies listed on Pink Sheets as "among the most [[speculation|risky investments]]" and [[financial advice|advises]] potential investors to heavily [[research]] the companies in which they plan to invest. Buying Pink Sheets [[shares]] is supposed to be difficult. Broker-dealers are [[injunction|enjoined]] to weed-out unsophisticated investors who may get an [[e-mail]] or [[word-of-mouth]] [[insider trading|tip]] about a small stock. Many Pink Sheets stocks may only be registered for sale in one [[U.S. state|state]] so that the only way to purchase the stock is to make a [[dividend reinvestment program|DRIP]]/[[business]]/unsolicited/[[accredited investor|accredited]] or other sophisticated form of investment. Many [[registered representative]]s do not even know how or if they can sell them. == Premium Market Tier == '''OTCQX''' is a premium market tier offered by Pink Sheets LLC that aims to raise the visibility of [[OTC-traded]] companies that, although not traded on a [[stock exchange]], have operating businesses and provide substantial disclosure to the marketplace via Pink Sheets, LLC. Pink Sheet has provided online stock tracking for many companies in its long history of online stock trading. Unlike most companies quoted on the Pink Sheets, OTCQX companies must provide audited financials and certain disclosures to Pink Sheets LLC but are not required to be fully SEC reporting companies (i.e. current with all SEC filings). == Disclosure Categories == Effective [[August 1]], 2007, all Pink Sheets traded companies that are not able or willing to meet the standards of OTCQX will be placed in one of the following disclosure categories. Designed to increase the amount of information available in all Pink Sheets traded companies, the disclosure categories do not signify issuer quality or merit of any security. Categorization is based on the level and timeliness of a company's disclosure and any category can include speculative, distressed, or questionable companies. Investors are encouraged to use caution when considering these companies for investment. <ref> {{cite news |url=http://www.pinksheets.com/pink/otcguide/categories.jsp |title=Pink Sheet Categories}}</ref> * '''Current Information''' - Indicates reporting companies that submit filings to [[regulators]] with powers of review and that make the filings publicly available or non-reporting companies that make current information publicly available on the Pink Sheets News Service. The Current Information category is based on the level of disclosure and is not a designation of quality or investment risk. This category includes [[shell companies]] or development stage companies with little or no operations as well as companies without [[audit]]ed [[financial statements]] and as such should be considered extremely [[Speculation|speculative]] by investors. * '''Limited Information''' - Is designed for companies with [[financial reporting]] problems, economic distress, or in [[bankruptcy]] to make the limited information they have publicly available. The Limited Information category also includes companies that may not be troubled, but are unwilling to meet Pink Sheets' Guidelines for Providing Adequate Current Information. Companies in this category have limited [[financial information]] not older than six months available on the Pink Sheets News Service or have made a filing on the SEC's [[EDGAR]] system in the previous six months. * '''No Information''' - Indicates companies that are not able or willing to provide [[disclosure]] to the public markets - either to a [[regulator]], a [[stock exchange]] or Pink Sheets. Companies in this category do not make Current Information available via Pink Sheets 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. Publicly traded companies that are not willing to provide information to investors should be treated with suspicion and their [[securities]] should be considered highly risky. * '''Caveat Emptor - Buyer Beware'''. There is a public interest concern associated with the company, which may include a [[Spam (electronic)|spam]] campaign, [[stock promotion]] or known investigation of [[fraud]]ulent activity committed by the company or [[insider]]s. During a spam campaign, any stock that is not in the Current Information category will also have its quotes blocked on pinksheets.com. == See also == * [[OTC Bulletin Board]] * [[Bloomberg L.P.]] * [[Reuters]] == References == <div class="references-small"> <!--See http://en.wikipedia.org/wiki/Wikipedia:Footnotes for an explanation of how to generate footnotes using the <ref(erences/)> tags--> <references/> </div> == External links == * [http://www.pinksheets.com Official website] * [http://www.sec.gov/answers/pink.htm SEC information about the Pink Sheets] * [http://www.sec.gov/answers/listing.htm SEC Listing and Delisting Requirements] * [http://www.otcqx.com OTCQX website] * [http://www.otcqx.com/otcqx/securityList List of companies quoted on the OTCQX] [[Category:Companies listed on the Pink Sheets| ]] [[Category:Stock market]] [[Category:Stock exchanges in the United States]] [[ru:Розовые листы]] [[zh:粉单市场]]