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David Pinsen
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As the founder of Launching Innovation, David Pinsen has brought together a talented team of developers, designers, and academic finance experts to create easy-to-use tools to solve complex problems for investors. David Pinsen brings 17 years of business development, innovation, and financial... More
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  • The Pink Sheets: Then And Now 0 comments
    Oct 3, 2010 7:28 PM

    Ten years ago, every stock that was quoted on the electronic quotations system then called The Pink Sheets (i.e., any stock traded under a symbol with a “.PK’ extension), run by the company then called The Pink Sheets, LLC, was called a Pink Sheets stock. I (and, I’m guessing, most folks familiar with the Pink Sheets) still consider a .PK stock a Pink Sheets stock. The company formerly known as The Pink Sheets, LLC has engaged in a few clever bits of re-branding in recent years though.

    The first was changing the name of the company itself from The Pink Sheets, LLC to Pink OTC Markets, Inc.

    The second was changing the name of the quotation system formerly called The Pink Sheets to Pink Quote.

    The third was subdividing the stocks it quoted into 8 tiers, and re-categorizing as Pink Sheets only those stocks in tiers 4 through 6. This enabled Pink OTC Markets, Inc. to sell access to its “premium” tier, the OTCQX, for $15k per year (plus a $5k application fee) to companies meeting several rather minimal requirements (e.g., not being bankrupt, having a share price above 10 cents per share, being an operating company, reporting current information in some form, etc.).

    What prompted me to look into this was an invidious comparison made by one of the InvestorsHub regulars of Alloy Steel International (which is currently on tier 4 — “Pink Sheets — Current Information”) to one of his holdings, JBI, Inc., which is quoted on the OTCQX tier (and which was also the subject of a so far prescient short call by Avoidthegarbage on Short Screen). If you pull up these companies on Yahoo! Finance, for example, they’ll both appear with .PK extensions on their symbols; to see what tier of the Pink Quote they’re on, you can pull up their symbols on OTCmarkets.com (you can also access the site via its old domain, pinksheets.com). Here is a sample of what tier a few different stocks appear on:

    Nanologix, which I’ve owned in the past and blogged about here before: Pink Sheets — No information

    Electronic Game Card, Inc, a currently bankrupt, former favorite of a couple of InvestorsHub regulars: Caveat Emptor

    Nestle, S.A., the Swiss multinational: Pink Sheets — Current Information.

    Disclosure: Long AYSI.PK
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