otc markets group

Apr 10

Otc markets group

For more information on what’s required in each tier, visit the OTC Markets website to learn more.

See also - SEC Fast Answers:


otc markets group

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OTC Markets, OTCQX Benefits, and NASDAQ

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Companies involved in over-the-counter (“OTC”) exchange trading face a choice – which exchange do I pick? If your company is not trading on a major exchange like NASDAQ or NYSE, there are a few options at play in OTC trading, with some more popular than others.

The Financial Industry Regulatory Authority (“FINRA”) operates the OTC Bulletin Board (“Bulletin Board”), traditionally a “fan favorite” among companies trading in OTC markets.

However, there has recently been a major change in how companies are trading, what options they have, and where their loyalties lie. The Bulletin Board is seeing the lowest number of companies in some time, and with the recent renovation, or rather near removal of its website, its popularity seems to be on the decline. A few factors are at play here, with the most notable being that the rules and requirements of this exchange are more stringent than others.

For instance, companies quoted on the Bulletin Board must fully report on financial performance. However, as an upside, there are no market capitalization, minimum share price, corporate governance, or other requirements at play. Companies which have been “de-listed” from stock exchanges for falling below minimum capitalization, minimum share price, or other requirements, often end up being quoted on this exchange.

As the SEC piles on regulatory requirements, and companies face increased pressure to comply, more are turning to the less complex OTC Markets Group, previously known as Pink Sheets, with its three exchanges seeing a surge in participation:

­ OTCQX ­ OTCQB ­ OTC Pink

So, how do these OTC Markets Group marketplaces differ? Here’s a guide to what you should know about the ins and outs of the financial standards necessary for each.

OTC Markets Group Today, most companies that do not trade on a major exchange are listed on the OTC Markets Group.  Unlike securities listed on the US stock exchanges, securities on the OTCQX, OTCQB and OTC Pink marketplaces may trade without being registered with the SEC.

To help investors analyze, value, and trade securities, OTC Markets Group categorizes the 10,000 securities trading on the three marketplaces based on the quality and quantity of information provided.

Here are the checklists you can use to determine where your company fits:

OTCQX – ‘The Best Marketplace’ Requirements The OTCQX is for companies qualified by high financial standards, the quality of their disclosures and sponsorship by a third party advisor. 

Find the full checklist here: http://www.otcmarkets.com/services/companies/services-overview

OTCQB – ‘The Venture Marketplace’ Requirements The OTCQB is designed for entrepreneurial and development companies that are current in their reporting but may not yet qualify for OTCQX.

Current U.S. SEC reporting and bank reporting companies, and, for the first time, International Reporting companies listed on a Qualified Foreign Stock Exchange, will be eligible for OTCQB.

Securities of companies that do not meet the OTCQB standards or qualify for OTCQX will likely continue to be traded by broker-dealers on OTC Pink.

All companies are required to post their initial disclosure on the OTC Markets website and make an initial certification.  They must also file initial and annual certifications signed by the CEO and/or CFO.

Find the full checklist here: http://www.otcmarkets.com/content/doc/otcqb/standards.pdf

OTC Pink – ‘The Open Marketplace’ Requirements Companies that neither qualify for OTCQX nor comply with OTCQB requirements are traded on OTC Pink – an open marketplace designed for broker-dealers to electronically trade securities without any company involvement.

The OTC Pink, which includes high risk, highly speculative securities, is divided into three tiers:  Current Information, Limited Information and No Information, based on the level of disclosure and public information made available by the company either through the SEC or posted on OTC Markets.  There are no qualitative standards beyond disclosure for OTC Pink companies, which include companies in all stages of development as well as shell and blank check entities.

For more information on what’s required in each tier, visit the OTC Markets website to learn more.

Source: https://www.sec.gov/divisions/marketreg/mrotc.shtml


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Otc markets group

OTC Markets, OTCQX Benefits, and NASDAQ

วิดีโอ otc markets group



The OTC Pink, which includes high risk, highly speculative securities, is divided into three tiers:  Current Information, Limited Information and No Information, based on the level of disclosure and public information made available by the company either through the SEC or posted on OTC Markets.  There are no qualitative standards beyond disclosure for OTC Pink companies, which include companies in all stages of development as well as shell and blank check entities.

OTC Link is registered with the SEC as a broker-dealer and as an alternative trading system, and is a member of FINRA. For further information on the services offered by OTC Markets Group, Inc. you may view its websites at www.otcmarkets.com.

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Over-the-Counter Market

The Financial Industry Regulatory Authority (FINRA) regulates broker-dealers that operate in the over-the-counter (OTC) market. Many equity securities, corporate bonds, government securities, and certain derivative products are traded in the OTC market. The OTC Bulletin Board (which is a facility of FINRA), and OTC Link LLC (which is owned by OTC Markets Group, Inc., formerly known as Pink OTC Markets Inc.), for example, operate within the OTC market, particularly with respect to OTC equity securities.

OTC Bulletin Board

The OTC Bulletin Board (OTCBB) is an electronic inter-dealer quotation system that displays quotes, last-sale prices, and volume information for many OTC equity securities that are not listed on a national securities exchange. Securities quoted on the OTCBB include domestic, foreign and American depository receipts (ADRs).

Only broker-dealers qualified with FINRA as market makers can apply to quote securities on the OTCBB. Under the OTCBB's eligibility rule, companies that want to have their securities quoted on the OTCBB must seek the sponsorship of a market maker as well as file current financial reports with the SEC or with their banking or insurance regulator. For more information, you may view the OTCBB's website at www.otcbb.com.

OTC Link LLC

OTC Link LLC (OTC Link) is an electronic inter-dealer quotation system that displays quotes, last-sale prices, and volume information in exchange-listed securities, OTC equity securities, foreign equity securities and certain corporate debt securities. In addition to publishing quotes, OTC Link provides, among other things, subscribers the ability to send and receive trade messages, allowing them to communicate for the purpose of negotiating trades.

All subscribers to OTC Link are broker-dealers that are members of FINRA. Subscribers are permitted to quote any OTC equity security eligible for quoting under Exchange Act Rule 15c2-11 or the applicable exemptions to Rule 15c2-11. OTC Link does not require companies whose securities are quoted on its system to meet any eligibility requirements. With the exception of some foreign issuers, the companies quoted on OTC Link tend to be closely held, very small and/or thinly traded. Most issuers do not meet the minimum listing requirements for trading on a national securities exchange. Many of these companies do not file periodic reports or audited financial statements with the SEC, making it difficult for the public to find current, reliable information about those companies.

OTC Link is registered with the SEC as a broker-dealer and as an alternative trading system, and is a member of FINRA. For further information on the services offered by OTC Markets Group, Inc. you may view its websites at www.otcmarkets.com.

See also - SEC Fast Answers:

Source: http://www.friedmanllp.com/insights/companies-flocking-to-otc-markets-group-bulletin-board-falling-behind