Pink sheet/penny stocks

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Definition of 'Pink sheet/penny stocks'

two names used to refer to shares listed in the OTC Bulletin Board. As illiquid, they were quoted in the computer age in the ballot papers distributed by brokers, specially printed on pink paper - hence the term "pink slips" (pink sheets). When people want to highlight their low price, the term penny stocks, that is, literally, "penny stocks." It is characterized by high risk, a large spread of bid and offer (bid-ask spread) and the extreme instability of behavior.

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