What Is the OTCQX?

The OTCQX is the top tier of the three marketplaces for the over-the-counter (OTC) trading of stocks. The OTCQX is provided and operated by the 澳洲幸运5官方开奖结果体彩网:OTC Markets Group. Stocks that trade on this forum must meet more stringent qualification criteria compared to the other tiers, which are the OTCQB/OTCBB and the Pink Sheets.

Understanding OTCQX

The over-the-counter (OTC) market is a decentralized market where 澳洲幸运5官方开奖结果体彩网:securities, not listed on major exchanges, are traded directly by a network of dealers. Instead of providing an order matchmaking service as with the NYSE, these dealers carry inventories of securities to facilitate any buy or sell orders. 澳洲幸运5官方开奖结果体彩网:Penny stocks, 澳洲幸运5官方开奖结果体彩网:shell companies, and companies in bankruptcy cannot q🏅ualifꦗy for a listing on the OTCQX.

The OTCQX roster, also called the OTCQX Best Market, includes a large number of 澳洲幸运5官方开奖结果体彩网:blue-chip stocks from Europe, Canada, Brazil, and Russia. These large foreign stocks are frequently global household names.

Regulation of OTCQX

Companies trading on the OTCQX must follow standards to improve transparency. The OTCQX excludes companies that are most likely to be associated with stock 澳洲幸运5官方开奖结果体彩网:promoters and other shady operations. The OTCQX sets standards that a company must meet for inclusion. A company must meet high financial standards, be current in its disclosure, and have sponsorship from a professional third-party advisor. Listed companies report to a U.S. regulator such as the 澳洲幸运5官方开奖结果体彩网:Securities and Exchange Committee (SEC) or the 澳洲幸运5官方开奖结果体彩网:Federal Deposit Ins🍷urance Corporation (FDIC).

The OTCQX marketplace is run by OTC Link, an electronic inter-dealer quotation and trading system developed by OTC Markets Group. OTC Link is registered with the SEC as a 澳洲幸运5官方开奖结果体彩网:broker-dealer and also as an 澳洲幸运5官方开奖结果体彩网:alternative trading system (ATS). OTC Link enables broker-dealers to not only post and disseminate their quotes, but to also negotiate trades through the system’s electronic messaging capability. This feature allows it to replace the 澳洲幸运5官方开奖结果体彩网:Over-the-Counter Bulletin Board (OTCBB), which was a quotation-only system.

The OTCQX Marketplace provides some advantages to 澳洲幸运5官方开奖结果体彩网:investors. It separates out the superior companies from the numerous OTC companies that are financially challenged, those involved in questionable activities, or both. It enables investors to participate in the growth of foreign blue chips. Investors may view real-time Level 2 quotes with detailed market data and market depth.

All broker-dealers that trade OTCQX, OTCQB, and OTC Pink securities have to be 澳洲幸运5官方开奖结果体彩网:Financial♓ Industry Regulatory Authority (FINRA) members. Further, they must register with the SEC and are subject t💎o state securities regulations.

In this way, as with exchange-traded securities, investors trading OTC securities are protected from an unethical broker-dealer’s illegal practices by the same SEC and FINRA rules such as 澳洲幸运5官方开奖结果体彩网:Best Execution, Limit Order Protection, Firm Quo✨tes, and Short Positio🍃n Disclosure.

OTCQX Tiers

The reason large and prestigious companies list on the OTCQX rather than on a major exchange, such as the NYSE, is ma♏inly to avoid the high costs associated with listing shares. Another reason is to bypass the expenses incurred in meeting the stringent ongoing disclosure and legal requirements that come with maintaining their listings. In contrast, the application fee for international and U.S. companies that meet the OTCQX requirements is much smaller.

To be eligible for a listing on the OTCQX U.S. Premier Tier a U.S. company must meet specific and additional requirements. Requirements include a minimum 澳洲幸运5官方开奖结果体彩网:bid price of $1 for the preceding 90 business days and meeting the financial criteria for continued listing on the Nasdaq Capital Market.

The Premier Tier is designed to identify large, high-quality issuers that would qualify to list on a national stock exchange. The comparable OTCQX International Premier tier is for foreign companies that meet specific qualifications of the NYSE’s w♚orldwide standards.

While stocks trading on the OTCQX have many of the same protections as more established, larger stocks, they are still considered to be speculative. There is also no guarantee that any item trading here will be of higher quality than stocks trading on other over-the-counter tiers, or even another OTC marketplace. As such, traders would be well served to implement robust 澳洲幸运5官方开奖结果体彩网:due diligence before committing their capital.