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How does one have a "premature guess"?
I have no idea how KMAG will trade if that makes you feel better. Just talking about the overall patterns of others and how that might apply here. Yes they are all different, but I have yet to see a suspended pink (not just LLEG) achieve a stable trading pattern and grow on the greys. That's the beauty of the interwebs, anyone can go see this fact for themselves.
It just so happens that my LLEG experience triggered my interest in understand this entire phenomena.
There will be a market. It may last for weeks. It will also be unpredictable. If you are trying to buy and have a buy order in, it may go unfilled for the day yet you will see trades occurring below your price. And the opposite too, you will see trades that are coming through at prices above what you are trying to sell for. When the suspension is lifted many of these suspended stocks will be in the top 10 for OTC volume for grey sheets for at least a week or so...maybe longer.
The illiquidity comes later.
Ahhh...therein lies the difference. I don't believe those numbers until a bonafide audit is done. Apparently you do.
To each his own.
What suspended pink stock on the grey sheets is doing well 30 days out, 90, 180, 365 from suspension lift?
I keep looking ....
Premature. Let's judge in about 6 months.
Just paying it forward.
I have watched many of these unfold. There is almost always an initial reaction that can come in many forms. A tweet, a blog post or a PR. MIKP CEO takes the cake for his blog post though and sents the new standard for dumbest thing a pink CEO could do after a suspension.
However most of the first PR's or "communications" have some subset of the following content.
1) caught us completely by surprise
2) it appears to be related to something we don't control (some third party issue)
3) it's related to a minor paperwork issue we are clearing up now
4) I can believe my integrity has been called into question
5) we were just in the process of uplisting
6) we were just in the process of auditing our financials
And my personal favorite
7) they appear to be offended by a cartoon we posted referring to the "SEC" when we were talking about the Site Evaluation Committee. That comes from LLEG, where I took some good advice during the suspension and learned a lesson without losing much.
Their only concern right now should be having their lawyer deal with the SEC. However, it is likely that JR knows exactly what the issues are. But I would not advise him to share them at this point.
I doubt you will see anything more than "we are working diligently to address the SEC's concerns".
It's one thing to fling PR's as an unreporting pink....it's another to do so when you are under investigation. The PR's, if any, will be very vanilla and will leave a "is that all we get?" feeling.
Most suspended pinks sheets message boards after a suspension are filled with "but we are going to be different because of xxxxxxxxxx".
But I will say this, the amount of suspensions, or rather the increase in 2011 and 2012 I believe are going to lead to a greater number of ones coming out of suspension in the future. As to whether 1/100 ratio holds (actually I think it is closer to 1/500) or improves is another question. There is a path to get out. But there is also a path to swim across the Atlantic.
The grey sheets contain stocks in many "categories". One type of stock seen on the greys are "suspended pink sheet" stocks. You cannot look at stocks on the greys in general and try to equate performance, tier changes, etc. and think that the statistics apply to suspended pink sheet stocks.
Beyond the opinion, THE FACT remains that of ALL the suspended pink sheet stocks in the last 10 years (at least), ONLY one, appears to have made it back to the pinks and it took years.
People can decide for themselves how that influences their decision.
EDIT: The "stickie" above, IMHO, is very misleading in this regard.
Garyst, my only concern with the advice is that there are in fact equally good reasons (IMO much more compelling) to "sell into stupid" when it re opens. Although what happens to any given suspended pinkie that reopens on the greys in the days or weeks following a suspension lift may very, and they do greatly, the overall trend over the longer term is pretty consistent. In the last 10 years there is only one real example of a suspended pink reviving itself from the greys. Patience or hesitation can thus also be a bad thing. And the history of almost any suspended pink bears that out. Also trying to time a trade on the greys is very risky. Movement is completely unpredictable.
While hope and patience are very admirable, the reality of this situation needs to be understood by any investor. There is no place for emotion. But I will not argue with someone who understands the statistics and feels that in this case, this stock will be different.
But go to any board of any of the suspended stocks in this batch and you will see exactly the same feelings and beliefs about those stocks.
Actually wasn't there a fat finger trade that popped it to 0.015 shortly after the suspension was lifted? Is he using that as his basis for the range??!!
This is not a trading halt. This is a trading suspension. Trading halts are implemented by exchanges, trading suspensions by the SEC. There is a big difference.
I would also encourage posters to review the charts for the many pink sheet stocks suspended by the SEC on June 7, 2011 and see if any of their performance on the grey sheets since coming off suspension fit the profile provided in the post I am replying to.. And then check every pink sheet suspension since then or before.
Actually what you may see happen is a single odd number share volume trade right at the end of the trading day...usually an uptick to get a better "close" price. I am never sure whether this is just an odd lot remainder some broker wants to move, or it is a matched trade for that purpose. Another funny aspect will be the small trades that are worth less than the commission on the trade.
Good to hear, you will need both.
most often( and not that often) a company will get a "no action" letter
Yes...thanks!. Given the relatively large increase in suspensions in 2011 and 2012 with the new (relatively) microcap fraud group at SEC, some of this may be new territory in terms of volume of investigations and activity.
Yes they do and did;
They were cleared of wrong doing in the 2003 hedge fund scandal. Maybe I misinterpreted what was meant by the statement "clean and good". The SEC does not pass judgement on the health of a company, on whether it is in good shape....
but yes, they can clear a company of wrong doing.
But I would note that it generally takes many many years to get to that point and usually a company has to fight to get the SEC to state that an investigation is complete and nothing was found. Normally, they will say nothing, even if they stop. A lot of times it ends up as a "books and records" hand slap and an official "don't break the law again" letter...but that result is almost never in the scale of months....but years.
Every suspended pink charts it's own path on the greys. The destination is pretty much the same, just the route taken and the amount of time vary.
The Sec will give the nod that all is clean and good
The SEC does not do that. Ever.
Where did I say it was the right thing??? Simply stating the process and the results. There is actually a lot of things that I think are wrong and it is always a little bit of a mystery as to how any given stock gets suspended with the number of obvious frauds out there. There is also incredible lack of transparency in the process and sometimes it is next to impossible for a company to know where they sit with an investigation.
But the results, eventual disposition and history of SEC suspensions is fairly well established. As a number of posters have provided information on.
The SEC does not suspend based on one or even many complaints. They do their own investigation, gather their own facts and then make the call. And they make suspensions very carefully based on the evidence as they know the impact it has to current investors. But when the evidence suggests that future investors are at real risk, only then do they take that step. And they are rarely wrong. To believe that this is a simple reaction to a complaint(s) is naive.
They rarely go there immediately. It is a slow painful process. For those that truly want to minimize loses, there is a fews days to possibly a few weeks when it reopens to sell into the "averaging down", "this is all a big mistake" emotional activity.
You will hear two refrains during this time, one is exultation each time it ticks up as proof positive that all is going to be ok...and second, as the volume starts to wane the view that it means nobody wants to sell so all is good.
All that happens is that activity gets more sporadic, price swings can be signficant as trades are manually matched, and for those that think this will be a swing trade opportunity, you best think again.
KMAG was SUSPENDED, not halted.
It is on the grey sheets now, but will not be allowed to trade until Oct 1.
Not sure where your information is coming from.
THAT is the exact article I read when a pinkie I was in was suspended over a year ago. I swallowed my pride and "sold into stupid" on days 2 and 3 when the supension was lifted and the stock was on the greys. When the emotional buying stopped, the stock price and volume started its slide. Lots of PR's, lots of talk of patience, etc. result Was though, I got out with something left. The stock has been at 0.0001/no bid for months now.
There is no comparison between an xxxxF grey listing and KMAG or any suspended pink. None.
Suspended pinks that hit the greys are in a category all by themselves.
I realize that the activity of 'other' grey sheet listings gives the impression of hope...but it is empty...at least from that perspective.
Research what types of stocks are on the greys and why.
Grey to pink for a suspended pink is very rare. I can't find a single example on that list of a pink stock that was suspended, re-opened on the greys and then made it back to the pinks. Can anyone post an example...or enough examples to be meaningful?
What is interesting is that one of the first things that folks do when a pink is suspended and banished to the greys is to post the OTC market list on the message board showing the Tier changes as an example of regular 'revival' for suspended pinks. But none of the examples where formerly suspended pinks. This is the first time I have seen it hit sticky status....
Sorry...there are MANY types of pink sheet stocks...but you will rarely find a suspended pink making it back. 99% don't.
Actually no, it's not. Those are foreign companies generally registered with their home countries stock market regulatory body. They trade on foreign exchanges but cannot trade on a US exchange because they are not an SEC filing company. Go and look at some in terms of size, many are recognizable names.
KMAG is not in that category and you cannot use the trading patterns of those companies on the grey sheets to predict what will happen with KMAG.
All of the stocks you list as trading on the greys have an "F" on the end. That means they are a foreign company. Some large foreign companies trade on the greys because they do not file with the SEC. See what you can find without the "F". And more specifically look at suspended pinks....not many trading at any volume and price and almost all are headed in the same direction.
Well, only time will tell. I have described the path that, in general almost every suspended pink follows. Of course at the time, any investor wants their company to be different, and will hang on any information or view that supports it being the possible exception. Maybe KMAG will be that exception. But the reality is your better off going to the roulette table...odds are better.
Go look at the board for LLEG. They had a million in the bank when suspended.. See what was posted during the weeks after the suspension, look at how it reopened....look at the path it followed. Look at its from a few months ago. They are still around as KMAG may be 18 months from now.
But look at its price today. The bad news is suspended pinks never really die, there is no point at which you can say definitively "this is dead". It just withers into nothingness.
Look at all the pinks suspended last year on June 7. Each story is a little different, as KMAG's will be.
This is like time warp for me. Same view of the CEO, same "this stock is different".....etc. etc.
Actually I didn't get hit too hard. I managed to get out at even money and not loose everything.
I'll step back into the shadows now and check back in 6 months.
regardless GLTA.
There is one thing you can do. Although many invested in KMAG will look at this advice suspiciously, there will be one opportunity to get out when it re-opens. The stock price will not collapse immediately, it will be lower, ALOT lower, but it won't be in the trips. It may even rebound slightly from the first day hit as the emotional buyers average down. You will have a few days, even a few weeks. However, the path from there is well worn by many suspended pinks. Also check with your broker about trading greys...it is not straight forward.
When someone posts that MAKE SURE they are making a distinction between companies that move up from the grey sheets BUT ARE NOT UNDER INVESTIGATION ie. started on the greys...and those that came from the pinks via suspension.
What I am talking about is a pink sheet stock that gets suspended, re-opens on the greys. They almost NEVER, if ever come back.
There are plenty of examples of uplists from the greys for the first example I list above. But that is not what this is.
It was even better. And the company has filed an S1 since then, and three amendments. It's actually hung in there much longer than most.....but 0.0001/0 vol. it was one of the 17 or so suspended on June 7, 2011.
The SEC could care less about the "business". What they focus on is the publically traded entity KMAG and its disclosures, filings, etc. The reality is they will need a MM to come off the greys and NO MM is going to touch KMAG while it is under investigation, and the SEC can move at a snails pace....and in the meantime will say nothing. KMAG knows exactly why they were suspended, but they will not be able to discern the SEC's course of action for quite some time.
Pretty simple actually. I got caught in a pink that got suspended. Someone came on and made some of the same statements I have made. I did some research and was able to come to the conclusion that in fact, despite my emotion, I needed to find a way out. Many of the posts I am seeing on this look EXACTLY like I saw back then. Blame the SEC, talk about uplisting, etc. etc. but the reality was much different. I managed to get out at about 25% of pre-suspension price...and the stock over a year later is at 0.0001 and zero volume. Just paying it forward to someone here.
Sorry, suspended pinks almost never come back from the greys. I am actually not aware of any, I am sure there is one out there...but it would be the remote exception. That's just a fact. I realize the is the last thing that anyone in this stock wants to hear.
This is a well worn path. The stock will re-open on the greys after the suspension is lifted. No MM is going to touch the stock while it is under investigation. Uplist to the pinks is a bit of a dream at the moment. When the suspension is lifted the stock will then start a step function downwards with pricing marching all over the place and volume slowly evaporating, trading on the greys is erratic. There is an interesting phenomena whereby some can recover what little is possible by "selling into stupid". Google the term, there is an excellent article about the concept. SEC investigations can drag on for many many months, usually years. Go look at the fortunes of the gaggle of stocks suspended on June 7, 2011.
Sorry, there is nothing good in this...and the death can be very slow...
Actually it means "Initial Public Offering"