About Pink OTC Stocks

Introduction

Stocks that are classified as trading in the Pink OTC market are stocks that have not gone to the trouble of meeting the requirements imposed by the OTC Markets Group for their stock to trade in the OTCQB or OTCQX markets . If you are new to OTC stocks, you can read about OTC stocks. This article analyzes the stocks in the Pink market in our database, in order to get a "big picture" view of the Pink OTC market. You can see those stocks using our list of Pink stocks.

We intentionally do not put all Pink stocks in our database. We only include in our database Pink stocks if they are owned by a U.S. ETF or if the stock is one of the most actively traded OTC stocks. There are thousands of Pink stocks not in our database that are so called "penny" stocks that are probably of questionable quality because they don't make regular ongoing disclosures to investors.

Analysis

Here is a summary of the Pink stocks based on size category:

CategorySecurity CountTotal Market Cap%
Large cap323$14,821,974,040,80093.94%
Mid cap162$878,432,795,2805.57%
Small cap68$71,116,549,2920.45%
Micro cap241$6,893,186,1890.04%
Unknown8$00.00%
Total802$15,778,416,571,561100.00%

As explained in our article size categories, there is no standard definition of what makes up a "large cap" stock or a "mid cap" stock. On our website, we use a cutoff of $10 billion to determine a large cap stock. This is a just a widely used rule of thumb that we have also chosen to use. Similarly, a "mid cap" stock under our definition is a stock with a market capitalization between $2 billion and $10 billion, a small cap stock has a market capitalization between $300 million and $2 billion, and a micro cap stock has a market capitalization under $300 million.

Here is a summary of the Pink stocks based on security type:

CategorySecurity CountTotal Market Cap%
ADRs484$11,398,197,119,55272.24%
Common stocks318$4,380,219,452,00927.76%
Total802$15,778,416,571,561100.00%

Notice the large number of ADRs. There are two types of ADRs: sponsored and unsponsored. An unsponsored ADR is where the ADR is created by a U.S. investment bank without the involvement of the company that the ADR relates to. These unsponsored ADRs are always classified as Pink (the OTCQX and OTCQB system is all about judging the quality of ongoing disclosures by the company, and a company that has an unsponsored ADR isn't making any additional disclosures to U.S. investors, other than the disclosures it makes in its home country).

Sponsored ADRs are also popular on the OTC Pink market. If a company wants to have a sponsored ADR trade on a U.S. stock exchange, the company has to start making additional disclosures to the U.S. Securities and Exchange Commission and to the stock exchange the company's ADR would be listed on (NASDAQ or NYSE). But a Pink ADR is much easier as the company does not have to make any additional disclosures to U.S. investors, other than the disclosures it makes in its home country.

If you are new to ADRs, read what is an ADR? See also our list of OTC ADRs.

A large portion of the Pink common stocks are foreign companies that have cross-listed their shares on the U.S. OTC market:

CategorySecurity CountTotal Market Cap%
Foreign common stocks170$4,333,904,247,12398.94%
U.S. common stocks148$46,315,204,8861.06%
Total318$4,380,219,452,009100.00%

Here is a summary of the Pink stocks based on country:

CountrySecurity CountTotal Market Cap%
France42$2,664,323,224,78316.89%
Japan93$2,599,552,293,98016.48%
China51$1,912,515,895,39612.12%
Germany37$1,422,846,840,0119.02%
Switzerland20$1,292,751,769,7308.19%
Australia43$875,563,355,2125.55%
United Kingdom52$812,359,321,6365.15%
Hong Kong45$685,027,824,9444.34%
The Netherlands8$532,523,382,2633.38%
Sweden21$379,182,847,5452.40%
Spain12$375,367,167,0412.38%
Denmark15$354,038,834,6362.24%
Italy8$275,374,790,4851.75%
Singapore8$219,513,426,5061.39%
South Africa20$194,847,068,1711.23%
Norway10$178,726,092,7471.13%
Brazil25$126,108,584,5700.80%
Ireland8$111,613,581,1570.71%
Finland5$105,578,168,6810.67%
Canada57$89,367,565,3080.57%
Austria12$84,863,069,3170.54%
Belgium4$71,581,468,1950.45%
Mexico6$54,272,111,9970.34%
Malaysia6$52,735,287,3370.33%
Russia11$49,205,882,6620.31%
Luxembourg2$48,083,528,6450.30%
USA148$46,315,204,8860.29%
Thailand3$43,092,376,8290.27%
Portugal1$19,907,718,6700.13%
New Zealand4$19,509,901,4800.12%
Philippines2$18,260,148,5810.12%
Turkey3$15,351,570,1790.10%
Greece3$12,613,984,5840.08%
Israel2$11,380,404,0860.07%
Colombia3$10,058,580,5380.06%
Hungary2$7,395,836,6030.05%
Taiwan1$4,527,244,8480.03%
India2$1,326,212,4350.01%
Bermuda2$496,248,0700.00%
Chile1$254,691,2310.00%
Jamaica1$1,304,2240.00%
Sri Lanka1$1,273,4900.00%
Indonesia1$487,8720.00%
Jordan1$00.00%
Total802$15,778,416,571,561100.00%

Notice the large number of Canadian companies. There are a large number of small Canadian mining and energy companies that are cross-listed on the U.S. OTC market. Here is a summary of the Canadian stocks based on size category:

CategorySecurity CountTotal Market Cap%
Large cap4$85,473,625,02395.64%
Small cap4$3,355,297,4433.75%
Micro cap47$538,642,8420.60%
Unknown2$00.00%
Total57$89,367,565,308100.00%

Because these are smaller Canadian companies, their primary listing tends to be on one of Canada's smaller stock exchanges and not on the Toronto Stock Exchange:

ExchangeSecurity CountTotal Market Cap%
Toronto Stock Exchange8$87,873,221,91198.33%
TSX Venture Exchange5$1,086,508,0031.22%
Canadian Securities Exchange5$277,822,0200.31%
39$130,013,3740.15%
Total57$89,367,565,308100.00%

The U.S. companies tend to be microcaps. Here is a summary of the U.S. stocks based on size category:

CategorySecurity CountTotal Market Cap%
Large cap2$42,796,965,38392.40%
Micro cap141$2,308,480,4934.98%
Small cap2$1,209,759,0102.61%
Unknown3$00.00%
Total148$46,315,204,886100.00%

The U.S. companies operate in a wide variety of industries:

IndustrySecurity CountTotal Market Cap%
Computer Hardware2$27,424,664,50459.21%
Rental & Leasing Services1$15,419,092,18333.29%
Banks-Regional2$929,835,8262.01%
Telecom Services2$345,666,3080.75%
Biotechnology6$285,877,4170.62%
Asset Management3$184,512,5570.40%
Shell Companies2$171,332,3810.37%
35$158,536,8830.34%
Solar3$151,049,7790.33%
Electronics & Computer Distribution1$139,361,6580.30%
Other Industrial Metals & Mining5$128,321,9160.28%
Utilities—Renewable4$122,078,1190.26%
Software—Infrastructure2$112,334,8560.24%
Grocery Stores2$98,229,0700.21%
Software—Application5$76,228,4500.16%
Footwear & Accessories2$74,199,7960.16%
Drug Manufacturers—Specialty & Generic8$49,957,6110.11%
Medical Instruments & Supplies2$48,327,1740.10%
Oil & Gas Equipment & Services3$44,002,9520.10%
Electrical Equipment & Parts2$39,778,5630.09%
Capital Markets2$37,929,0340.08%
Medical Devices2$36,788,2590.08%
Semiconductors1$26,844,7990.06%
Credit Services1$25,712,3620.06%
Internet Content & Information2$22,822,9310.05%
Electronic Components3$20,132,7300.04%
Utilities—Regulated Electric1$19,368,2250.04%
Health Information Services2$18,958,3750.04%
Medical Care Facilities1$18,671,6910.04%
Beverages—Non-Alcoholic1$15,905,9170.03%
Thermal Coal2$9,432,3550.02%
Apparel Retail1$8,427,7520.02%
Entertainment2$6,088,7270.01%
Travel Services1$5,468,2030.01%
Oil & Gas E&P4$5,227,4350.01%
Scientific & Technical Instruments2$5,125,2250.01%
Security & Protection Services2$4,419,7020.01%
Broadcasting1$3,420,8800.01%
Auto Manufacturers1$3,299,2870.01%
Information Technology Services1$3,057,4540.01%
Staffing & Employment Services1$2,869,7140.01%
Specialty Industrial Machinery2$2,758,9390.01%
Real Estate Services1$1,544,1440.00%
Paper & Paper Products1$1,250,6190.00%
Waste Management1$1,197,6590.00%
Semiconductor Equipment & Materials1$1,119,0810.00%
Aerospace & Defense1$922,5350.00%
Consulting Services1$741,3800.00%
Food Distribution2$426,4500.00%
Medical Distribution1$422,4790.00%
Education & Training Services1$395,1650.00%
Agricultural Inputs1$308,4170.00%
Real Estate—Diversified1$226,2700.00%
Conglomerates1$218,1470.00%
Farm & Heavy Construction Machinery1$192,9040.00%
Pollution & Treatment Controls2$66,1350.00%
Specialty Retail2$29,6000.00%
Oil & Gas Integrated1$19,0000.00%
Auto Parts1$6,9020.00%
Total148$46,315,204,886100.00%

Are Pink companies the riskiest?

Yes and no. Most Pink companies are large or mid cap foreign companies. If you know how to research a foreign security, these stocks don't seem that risky. But if the company is a micro cap U.S. company that isn't regularly reporting to the S.E.C., it will seem very risky. So the Pink market is really two different markets.


All data is a live query from our database. The wording was last updated: 03/15/2021.

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