Good read, don't agree with 100% of it though, but much of it.
My own OTC rules for "investments" not trades (constantly under development) learned from the school of hard knocks. Incidently, these rules eliminate 99% of OTC stocks:
Under 100M A/S and preferably under 50M O/S. Fully reporting otcbb, NO PINKIES unless it is a stock trading simultaneously on a senior exchange in another country.
Insiders buy or have bought their own stock.
No dilution. The money raised going public initially has sufficed.
Actual (and growing) revenues, not just "plans" for revenues.
No paid promotion. Penny pumpers are the devil himself.
The company has to have the potential to be substantially bigger than it is today. No tiny "niche" business...but a potential very large company. You can't uplist even if you are a real otcbb company, if you can't get the company big enough!
Quality management with high insider ownership, 20% or more (preferably more). The management have to be experts in their fields, and have no history of managing now-defunct or bankrupt stocks.
Has to make sense macroeconomically. Has to be in an industry growing so fast that there is enough room for the company and its competitors to eat, or a new (small) growing industry where is is one of the bigger fish already.
Stock is not well known, and pretty thinly traded. While this can mean illiquidity, it lets you accumulate for the demand that will come when the company is bigger.
IMO if an OTC stock can't meet all these requirements then its not worth more than a few hundred bucks thrown at it...IF that. Probably not even that, but hey we're all human.
I only know of a few OTCbb issues that meet all of these requirements, and I typically don't post about them or (publically) tell anyone about them so I can continue to accumulate. The stocks I end up posting about are those companies where I've broken one of the above rules, and I have to vent. Where I've found companies that meet those rules, I've been richly rewarded with multibaggers.
