OTC Pink

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Definition of 'OTC Pink'

The OTC Pink market, also known as the Pink Sheets, is a collection of over-the-counter (OTC) securities that are not listed on any major stock exchange. These securities are typically issued by small companies with limited financial resources and are considered to be high-risk investments.

The OTC Pink market is divided into three tiers:

* Tier 1: This tier includes securities that are current in their reporting with the Securities and Exchange Commission (SEC).
* Tier 2: This tier includes securities that are not current in their reporting with the SEC.
* Tier 3: This tier includes securities that are considered to be "penny stocks" and are subject to additional regulations.

Investors should be aware that OTC Pink securities are not as regulated as securities that are listed on major stock exchanges. This means that there is a higher risk of fraud and manipulation. Additionally, OTC Pink securities are often more volatile than securities that are listed on major stock exchanges.

Before investing in an OTC Pink security, investors should carefully review the company's financial statements and other information available about the company. Investors should also be aware of the risks involved in investing in OTC Pink securities.

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