Bulletin Board stocks, unlike blue chip stocks, are not traded over any major stock exchange like the NASDAQ or the NYSE. They can be purchased via the smaller electronic markets known as the Pink Sheets or the OTCBB (Over The Counter Bulletin Boards). These stocks are usually issued by companies with a low market capitalization – under 500 million dollars – that cannot always afford to fulfill the very stringent requirements necessary to trade over the larger exchanges.
Many of these companies listing Bulletin Board stocks, get a start on The Pink Sheets and OTCBB, and go on to become successful companies with excellent track records; however this is not always the norm. These electronic markets can be viewed as a proving ground for up and coming companies, many of which are virtual unknowns. In a field of potential success stories, it can be difficult to choose the ones that will go on to become something special, but a wise and savvy investor who has performed due diligence and studies market trends can sometimes spot that “diamond in the rough”.
The internet, television, radio, newsgroups, stockbroker’s websites, message boards and financial news services are all great ways to find information on companies that have potential for greatness. All these available avenues should be utilized thoroughly when deciding which Bulletin Board stocks will make a significant and worthwhile addition to your investment portfolio.
Bulletin board stocks may not always come with a caveat, so investors beware! Because of the relatively lax rules and regulations in this volatile market, it is possible for certain stocks to be manipulated by nefarious traders using ‘pump and dump’ and so called ‘boiler room’ schemes. These scams unless they are caught in time can deal a blow to an investment portfolio. To avoid such a financial disaster, it is wise consult a trusted financial advisor before purchasing any stocks, and recognize hype for what it is.
Bulletin Board stocks have been known to skyrocket in value, and while they may be extremely risky they can bring great rewards to the savvy investor. In performing due diligence, it is a good idea check stock movements daily, paying close attention to any new information that presents itself. Eventually over time an investor will gain a well rounded view of the market and the proper insights for profit maximization.
