(2) The company may be listed on the OTCBB because it is unable to meet the initial listing requirements of the Nasdaq or NYSE. In such a case, a company may choose to test the waters of the OTCBB, using it as a stepping stone before leaping into the larger exchanges and markets.
The Pink Sheets are different from the OTCBB. Companies on the Pink Sheets are not required to meet minimum requirements or file with the SEC. So-named because they were actually printed on pink paper, the Pink Sheets started out as a daily quote service provided by the National Quotation Bureau. Typically, companies are on the Pink Sheets because either they are too small to be listed on a national exchange or they do not wish to make their budgets and accounting statements public. To avoid having to file with the SEC, some large foreign companies such as Nestle S.A. have penetrated the American securities markets through the Pink Sheets. Companies listed on the Pink Sheets are difficult to analyze because it is tough to obtain accurate information about them. The companies on the Pink Sheets are usually penny stocks and are often targets of price manipulation. They should only be purchased with extreme caution.
Read more: What does it mean when a stock trades on the Pink Sheets or the OTCBB? http://www.investopedia.com/ask/answers/201.a...z3tmd4WvFn
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The Pink Sheets are different from the OTCBB. Companies on the Pink Sheets are not required to meet minimum requirements or file with the SEC. So-named because they were actually printed on pink paper, the Pink Sheets started out as a daily quote service provided by the National Quotation Bureau. Typically, companies are on the Pink Sheets because either they are too small to be listed on a national exchange or they do not wish to make their budgets and accounting statements public. To avoid having to file with the SEC, some large foreign companies such as Nestle S.A. have penetrated the American securities markets through the Pink Sheets. Companies listed on the Pink Sheets are difficult to analyze because it is tough to obtain accurate information about them. The companies on the Pink Sheets are usually penny stocks and are often targets of price manipulation. They should only be purchased with extreme caution.
Read more: What does it mean when a stock trades on the Pink Sheets or the OTCBB? http://www.investopedia.com/ask/answers/201.a...z3tmd4WvFn
Follow us: Investopedia on Facebook
