OTC (over-the-counter) Shares, Pink Sheets and Bulletin Board, What Are the Minimum Requirements for Listing?

The stock market is an uncertain and exciting place, where you can never really predict what is going to happen, even if all the signs point to your desires coming true. Many millions of dollars are made and lost every day on the floors of the major national securities exchanges, and which side you come out on always depends on whether or not you have anticipated the way that companies will perform and the market will respond on any given day. If you are thinking about going public with your company, you might be wondering about the minimum requirements for listing it on one of the OTC boards or pink sheets.

If you’ve never hear of OTC Shares, Pink Sheets or Bulletin boards, you should know that they are different from the country’s main securities exchanges, most notably the New York Stock Exchange and the NASDAQ. The difference arises in the background research that is available on the companies in question, and their ability to meet the requirements of the larger exchanges for trading privileges. If a company has gone public, but has not been able to consistently meet the minimum requirements, they usually opt to list themselves on the OTC or Pink Sheets instead.

Whereas companies that want to trade themselves on the Big Boards has to prove certain levels of volume, price of shares, number of shareholders and other criteria, the over the counter bulletin boards do not require that the companies disclose this information at all. While this is very convenient for companies that want to go public quickly so that they can increase their valuations and have access to easy methods for raising capital, it does allow their to be room for companies that are not as legitimate as they should be. When considering where they will purchase shares, people should be very wary of purchasing stocks in a setting where there are no minimum requirements.

That being said, there are many worthwhile companies that get their start or even prefer to be traded in these areas where there are much looser minimum requirements because it allows them to sell their stock at a much lower price and attract an entire audience of consumers that might otherwise have shied away from the high prices and big pressure of the big boards. You can learn more about how to create a successful public company at www.tcc5.com.