The OTC, or "Over-the-Counter", market is not an organized marketplace or exchange. OTC is a catchall phrase for any market in an equity security that is not listed on a US exchange or on the Nasdaq Stock Market. OTC securities are issued by companies that either choose not to list, or are unable to meet the standards for listing, on NASDAQ or a US stock exchange.

OTC equity securities can be quoted on the Pink Sheets Electronic Quotation Service, and/or, if the securities are registered with the SEC and their issuers are current in their reporting obligation, on the OTC Bulletin Board. Some OTC securities are not quoted on either the Pink Sheets or the OTC Bulletin Board; these securities are sometimes referred to as gray market or "Other-OTC" securities. Because Other-OTC securities are not quoted on any quotation service, bid and ask quotations for these securities are not available. However, NASD rules require its members to report transactions in all OTC equity securities to Nasdaq, so last sale and volume information is available for all OTC securities, including those categorized as "Other OTC." The Pink Sheets is a centralized quotation service that collects and publishes market maker quotes for OTC securities in real time. Pink Sheets is neither a Securities and Exchange Commission (SEC) Registered Stock Exchange nor a Broker-Dealer.

Quotation of OTC securities on the Pink Sheets is subject to Rule 15c2-11. The issuer of the securities may not apply to list or quote securities on the Pink Sheets. It is a market maker that determines whether to quote an OTC security and initiates quotation by submitting a Form 211 to the NASD. It is possible for a market maker to quote securities in the Pink Sheets without the knowledge or permission of the issuer of the securities.

Stock markets (including NASDAQ and the registered exchanges, such as NYSE or AMEX) have specific quantitative and qualitative listing and maintenance standards, which are stringently monitored and enforced. Companies listed on a stock market have reporting obligations to the market, and an on-going regulatory relationship exists between the market and its listed companies. OTC quotation services (Pink Sheets and OTCBB) facilitate quotation of unlisted securities. As such, any regulatory relationship between an OTC quotation service and the issuers may be relatively limited or non-existent. Many OTC issuers are not subject to SEC registration requirements and therefore do not make regular filings of financial information and other corporate events with the SEC. Because the Pink Sheets is not an issuer listing service and has no "listing requirements," OTC issuers are not required to provide financial information to the Pink Sheets, though some do so on a voluntary basis.

Investing in OTC Securities

The OTC market presents investment opportunities for intelligent, informed investors, but also has a high degree of risk. Many OTC issuers are small companies with limited operating histories or are economically distressed. Investments in legitimate OTC companies can often lead to the complete loss of the investment. Investors should avoid the OTC market unless they can afford a complete loss of their investment. Investors should never purchase any security without first evaluating the fundamentals of the company and carefully reviewing the financial statements, management background and other data. Investors who purchase securities based on a "hot tip" or the advice of chat room touts will often be disappointed. Unsophisticated or passive investors should completely avoid the OTC markets.

Many OTC securities are relatively illiquid, or "thinly traded," which can enhance volatility in the share price and make it difficult to sell an equity position at a later date. Investors should always be wary of any sign of fraud or manipulation. Don't believe everything that you hear or read. And if it sounds too good to be true, it probably isn't true. To learn more, visit our Investor Protection Information page.

Latest Blog Entries 

Fisker Automotive Announces a Letter of Intent for Assembly Contract With Valmet Automotive
Tuesday - July 15, 2008 @ 4:27PM Pacific.... IRVINE, Calif., July 15 /PRNewswire/ -- Fisker Automotive, Inc., a green American premium car company, today announced that Valmet Automotive will manufacture its first production car, the Fisker Karma. Known for producing high quality specialty cars like the Porsche Boxster and Cayman for Porsche AG, the Finland-based contract manufacturer brings to the Fisker Karma 40 years of experience of working with OEM customers and their wide ranging engineering and production needs. more...

GeoPharma Announces Record Revenues in Third Quarter Results
Thursday - June 26, 2008 @ 1:05PM Pacific....GeoPharma, Inc. (NASDAQ:GORX) (the “Company”) announced today a second consecutive quarter of record revenues reporting an unprecedented $23,890,000 for the fiscal fourth quarter ended March 31, 2008. The highest quarterly revenue total in the Company history represents a 31% jump sequentially versus the 3^rd quarter ended December 31, 2007 and a 68.5% increase versus the corresponding quarter a year ago. GeoPharma finished the fiscal year on March 31, 2008 with total revenues of $57,893,000. more...

Quantum Fuel Systems Technologies Worldwide Set to Join Russell 3000 Index and Russell Global Index
Friday - June 20, 2008 @ 6:30AM Pacific.... IRVINE, Calif., June 20 /PRNewswire-FirstCall/ -- Quantum Fuel Systems Technologies Worldwide, Inc. (Nasdaq: QTWW), a leader in the development and production of advanced propulsion systems, energy storage technologies, and alternative fuel vehicles, is set to join the Russell 3000 Index and the Russell Global Index when Russell Investments reconstitutes its indexes on June 27, 2008, according to a preliminary list of additions posted June 13, 2008 on http://www.russell.com. more...

uWink Hollywood Brings New Level of Food and Fun to Hollywood & Highland Entertainment Complex on Tuesday, June 17
Tuesday - June 17, 2008 @ 6:43AM Pacific....uWink (OTCBB:UWKI), an interactive dining experience serving classic American comfort food with a modern twist, opens its doors to a brand new location today at the famous Hollywood & Highland Center in Hollywood, California. Following the success of the first location in Woodland Hills, Nolan Bushnell, former CEO and founder of both Atari and Chuck E. Cheese, now brings his groundbreaking concept to Hollywood! There will be special events and prizes throughout the official grand opening weekend being held on Friday, June 27 through Sunday, June 29. more...

Advanced Cell Technology's Executive Invited to Present Today to FDA Advisory Committee on Cellular Tissue Therapies
Thursday - April 10, 2008 @ 6:23AM Pacific....Advanced Cell Technology, Inc. (OTCBB: ACTC) announced today that Jonathan H. Dinsmore Ph.D., Senior Vice President – Regulatory and Clinical, has been invited to present to the U.S. Food and Drug Administration’s Center for Biologics Evaluation and Research Advisory Committee on Cellular, Tissue and Gene Therapies. Dr. Dinsmore will deliver a presentation today titled, “Safety Considerations for the Clinical Application of Human Embryonic Stem Cells” to the FDA panel, which will convene at the Hilton Hotel in Gaithersburg, Maryland. more...

uWink Completes $10.4 Million Equity Financing

Wednesday - November 07, 2007 @ 5:26PM Pacific....uWink, Inc. (OTCBB:UWKI), a developer of digital media entertainment software and an interactive restaurant concept, announced today that it has completed a $10.4 million registered equity financing. The proceeds of the raise will be used to fund new restaurant development and general working capital needs. more...

Trading Alerts
Micro & Small-Cap Stock Report
Friday - August 1, 2008 @ 6:30AM Pacific....Wall Street sank Thursday, after weak readings on economic growth and the job market touched off renewed concerns about the financial health of businesses and consumers. The Dow Jones industrial average fell more than 200 points. The Commerce Department's report that gross domestic product grew at a 1.9 percent pace in the second quarter disappointed investors. Economists polled by Thomson Financial/IFR had expected growth of 2.4 percent in the broad measure of the economy's health. Investors were also concerned about Labor Department data saying that the number of people seeking jobless benefits jumped to the highest level in five years. Economists warned the weekly figures can be volatile, however, and some dismissed them as an aberration. A $4.5 billion cash offer from Bristol-Myers Squibb Co. for its cancer drug partner ImClone Systems Inc. kept the Nasdaq composite index from falling as sharply as other indexes. In other positive news, oil prices declined, and an index of Midwestern business activity indicated growth. But Wall Street could not shake off its worries about the economy -- particularly after sobering remarks from Former Federal Reserve Chairman Alan Greenspan on CNBC late in the afternoon. Greenspan said he would be more surprised if the United States did not enter recession than if it did. The comments came after Treasury Secretary Henry Paulson said in a speech in Washington that the economy will continue to grow at a moderate pace for the rest of the year, and the government's $168 billion stimulus package had helped grease the economy's wheels. more...

Quantum Fuel Systems Technologies Worldwide, Inc. The Next Big Thing!

OTCBlog WebLog
GOLD STOCKS - A "Perfect Storm" of Gold Price Drivers
Sunday - January 27, 2008 @ 9:45PM Pacific....Gold is seen by many financial professionals as a safe-haven investment for hard times and a hedge against inflation. The inflation-adjusted price of gold has remained stable on a centuries-long scale, although it has varied dramatically over shorter periods in response to such factors as war, inflation, monetary policy and consumer demand. more...

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