Understanding the OTC & pinksheets
I have been doing a lot of research on the Over The Counter stock listings. Seems there are two grades of stocks. All are listed with the NASD (National Asssociation of Security Dealers). Notice that I did not say they are listed on the NASDAQ exchange. No these stocks are traded between dealers. The first class are those listed with the Security and Exchange Commission and are responsible for filing annual reports and quarterly reports. NASD lists these on their Bulletin Board.... therefore the designation OTCBB or just OB for short.
The second class of OTC stocks are pink sheets. EAGM belongs to this second group.....therefore the designation EAGM.PK. This group of pink sheets usually is equal to a share of stock but not necessarily. Sometimes a pink sheet is equal to more than one share, SLX.PK is an Australian firm that separates and enriches uranium using microwave technology. The last time I checked a pink sheet cost five times a regular share or 5:1 ratio.
There is a shake-up underway within the NASD, and by August the 1st of this 2007 year, every pink sheet stock will have a visual pictoral designation. There will be four catagories: The first is a black diamond shape with a big green checkmark on it, a diamond shape similar to road construction warning signs. These companies comply by presenting an annual and quarterly report to NASD to be posted for all to see. The second group receives a Yield sign next to their name or stock symbol and they have minor flaws with reporting or financing. The third group receives a stop sign next to their name or stock symbol; they have definite flaws and are non-responsive to questions about their operations to stockholders, listing agencies &/or regulatory entities. Lastly, a black square (or flag if you wish to call it that) with a white skull over white crossed bones (skull and crossbones). These stocks are marked as such due to the NASD linking them to some promotional scam, short selling or some other form of stock manipulation.
We have heard no more about Cayanne Resources, nor has the symbol and name been changed on my on-line stockbroker screen. Needless to say EAGM has not succeeded in getting what they want from the NASD - which would be the green check. So the big question is: What will August bring? Will there be some form of clarification from the company? This is the $64,000 dollar question!
Hope I have given you some hope, and some things to PONDER!
Sam.
AI
