I don't know why this stock is now displayed differently on Google Finance as "PINK", Yahoo Finance has us listed as LVCA.OB, what is the .OB? I thought we were OTCBB, why the change to OTCQB? For a moment I thought the Q in OTCQB meant "in bankruptcy" but after some research apparently not, thank God.
I found this article dated 8/2011 and thought I should share it.
What Are OTCQX Stocks? What Are OTCQB Stocks?
About 4 1/2 years ago, OTC Markets Group Inc, which is far more commonly known as "pink sheets," organized their "pink sheet stocks" into 3 tiers of classification.
1. OTCQX Stocks (PremierOX)
2. OTCQB Stocks (PrimeOX)
3. OTC Pink Stocks
OTCQX stocks, the top tier, must trade for more than $1 per share. There also must be at least 100 shareholders with at least 100 shares a piece. OTCQX companies also report to the SEC.
OTCQB stocks, the second tier, can trade below $1 per share but they only need to have 50 shareholders with at least 100 shares a each. They do not have to report to the SEC but they are required to submit audited financial statements to OTC Markets Group and provide other disclosures to be listed with them.
There are no financial standards or reporting requirements fro the OTC Pink Stocks. Investors should be particularly wary when dealing with any stock in this category - they are more unpredictable than the Wild Wild West.
One of the main reasons I am writing about OTCQX stocks is that I've seen a growing trend lately for novice investors (i.e. investors who aren't making money with penny stocks) to seek out OTCQX and trade these automatically thinking they are "best penny stocks." This is not at all true!
First, you should note that many penny stocks trade on the OTCBB which is owned by the NASDAQ and much more tightly regulated than any of the OTC Markets Group Inc stocks, or "pink sheet stocks" as they are more commonly called. Plus, penny stocks can trade on the big boards as well. Some investors get confused and think that OTCQX stocks are the top tier of the OTCBB - be careful as this is not true.
Second, sometimes OTCQB stocks can actually be a better investment than OTCQX stocks, in the sense that they are more profit potential sometimes. There are many reasons for this and only a true expert at analyzing this class of penny stocks which is highly tricky would know what to look for.
Third, even though I just said that OTCBB stocks are more tightly regulated than OTCQX and other "pink sheet stocks," picking out the real gems in the penny stock world - those penny stocks that are literally on the cusp of something truly great is NOT a simple matter of picking the right category of pink stocks. There is so much more to it than that in fact! Just because a penny stock is a OTCBB stock does NOT mean it is necessarily a better investment.
