This is not the color of bed sheets you may be looking for at the Local store. Pinks sheets when it comes to stock markets refers to the color of the paper that quotes were made on in the past. The pink sheets as we know it today - is an electronic quotation system for over the counter securities. These listings are then called penny stocks.
Companies that are listed in the pink sheets may or may not be able to meet the requirements of the New York Stock Exchange and the Nasdaq. The Pink sheets have no listing requirements.
Companies with no financial history can be included in the Pink sheets listings. Therefore it needs to be clear that the pink sheets are not a registered stock exchange. This enables companies to raise capital who in this case would be unable to through the regular stock exchange.
So it must be noted companies within this exchange pose a greater risk. This is due in large part by the fact that companies on this exchange do not have to disclose much if any in the way of financial data.
The reality with pink sheets as is with penny stocks is the low cost of investment. This lures a lot of people in. They think because of the low cost that they risk little, but the opposite can be true. Because there are less requirements and very little financial data if any, one has to note that no history can mean that a company could be in financial ruin trying to raise capital.
As it is well known, higher risk means greater reward and just as equally greater losses. The inability to research these companies makes for a shot in the dark. As is often quoted, “diversify” Ask yourself if you take this risk can you afford to loose that money? If so then the rest is simple.
The Stock Market If you want to discover your pot of gold in the stock market, then you have to know it inside out. And for all the inside-out information on the stock market explained in simple, concise, layman terms, all you need to do is click on this link: Pink Sheets. Learn How To Find stocks Which Will Double. Simple enough, huh?
Source: www.articlealley.com
