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 cap348$17,217,367,372,27794.99%
Mid cap150$825,069,454,3164.55%
Small cap73$75,174,318,7940.41%
Micro cap231$8,749,510,8550.05%
Operating companies1$84,7300.00%
Unknown1$00.00%
Total804$18,126,360,740,972100.00%

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%
ADRs489$13,254,647,639,93273.12%
Common stocks314$4,871,713,016,31026.88%
Warrants1$84,7300.00%
Total804$18,126,360,740,972100.00%

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 stocks166$4,838,975,338,68699.33%
U.S. common stocks148$32,737,677,6240.67%
Total314$4,871,713,016,310100.00%

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

CountrySecurity CountTotal Market Cap%
Japan92$3,317,213,592,15918.30%
France42$2,611,585,979,28614.41%
China50$2,322,407,380,33812.81%
Germany37$1,708,793,595,3099.43%
Switzerland20$1,364,772,909,1497.53%
United Kingdom51$925,104,126,6715.10%
Hong Kong45$831,881,396,9404.59%
Australia40$808,200,229,9204.46%
The Netherlands8$602,128,135,4893.32%
Sweden21$486,954,079,5062.69%
Russia11$418,864,222,5752.31%
Spain11$379,184,573,9352.09%
Denmark15$325,455,999,7261.80%
Italy8$318,636,507,9721.76%
Norway11$215,859,348,1921.19%
Singapore9$200,265,303,2671.10%
South Africa20$188,464,447,8361.04%
Ireland8$146,426,476,2590.81%
Finland5$132,841,234,1470.73%
Brazil25$131,271,250,1200.72%
Austria12$102,224,179,6380.56%
Belgium4$92,097,501,1190.51%
Canada58$77,755,977,2880.43%
4$74,500,158,5480.41%
Malaysia6$69,388,682,4650.38%
Luxembourg2$46,584,549,9220.26%
USA149$32,737,762,3540.18%
Mexico7$31,501,082,0500.17%
Thailand2$30,270,428,5980.17%
Portugal1$21,862,799,4080.12%
New Zealand4$20,146,979,6620.11%
Philippines2$15,334,414,1340.08%
Greece3$13,525,921,5170.07%
Israel2$11,760,729,5600.06%
Turkey3$11,078,562,6150.06%
Jordan1$8,085,666,3040.04%
Colombia3$7,864,531,6010.04%
Guernsey1$7,630,817,7320.04%
Hungary2$7,239,903,9030.04%
Taiwan1$6,024,777,4450.03%
Chile1$1,024,829,0010.01%
India2$833,394,4140.00%
Bermuda2$560,561,3080.00%
Sri Lanka1$13,550,8590.00%
Jamaica1$1,304,2240.00%
Indonesia1$886,5070.00%
Total804$18,126,360,740,972100.00%

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$72,149,753,44492.79%
Small cap4$4,928,204,4446.34%
Micro cap50$678,019,4000.87%
Total58$77,755,977,288100.00%

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%
42$62,375,766,44480.22%
Toronto Stock Exchange4$14,315,789,82918.41%
TSX Venture Exchange5$764,137,4340.98%
Canadian Securities Exchange7$300,283,5810.39%
Total58$77,755,977,288100.00%

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 cap1$15,117,765,81146.18%
Mid cap1$7,637,199,40423.33%
Micro cap139$6,060,330,23618.51%
Small cap6$3,922,382,17311.98%
Operating companies1$84,7300.00%
Unknown1$00.00%
Total149$32,737,762,354100.00%

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

IndustrySecurity CountTotal Market Cap%
63$29,004,176,83888.60%
Banks-Regional2$1,024,099,5573.13%
Biotechnology5$484,486,8721.48%
Medical Devices3$319,206,4920.98%
Solar3$257,014,5820.79%
Health Information Services2$186,218,3140.57%
Security & Protection Services1$164,025,0000.50%
Shell Companies1$158,762,9430.48%
Asset Management2$123,880,4480.38%
Software—Infrastructure1$122,319,3220.37%
Grocery Stores1$109,158,0560.33%
Electronics & Computer Distribution1$94,281,1910.29%
Semiconductor Equipment & Materials1$91,799,1760.28%
Staffing & Employment Services1$85,050,7240.26%
Utilities—Renewable3$83,193,3050.25%
Drug Manufacturers—Specialty & Generic5$41,994,5170.13%
Electronic Components2$38,110,8750.12%
Oil & Gas E&P4$33,693,6260.10%
Internet Content & Information2$29,853,6770.09%
Telecom Services1$27,480,0850.08%
Credit Services1$25,712,3620.08%
Computer Hardware1$25,169,9800.08%
Software—Application3$21,904,8010.07%
Utilities—Regulated Electric1$20,996,5130.06%
Electrical Equipment & Parts1$19,789,0080.06%
Broadcasting1$18,979,4220.06%
Scientific & Technical Instruments2$17,168,3320.05%
Travel Services1$16,328,6630.05%
Paper & Paper Products1$14,756,4550.05%
Farm & Heavy Construction Machinery1$13,162,8720.04%
Oil & Gas Equipment & Services4$9,259,8450.03%
Apparel Retail1$7,886,7740.02%
Beverages—Non-Alcoholic1$6,276,1780.02%
Other Industrial Metals & Mining2$5,630,8440.02%
Food Distribution2$5,544,8860.02%
Medical Distribution1$5,393,3440.02%
Real Estate Services1$4,692,9020.01%
Agricultural Inputs1$3,330,9060.01%
Waste Management1$3,118,9040.01%
Specialty Industrial Machinery2$3,052,0360.01%
Thermal Coal2$2,394,0550.01%
Entertainment1$1,536,4160.00%
Restaurants1$1,143,4170.00%
Footwear & Accessories1$1,118,8860.00%
Medical Instruments & Supplies1$1,059,8390.00%
Conglomerates1$933,5270.00%
Pollution & Treatment Controls2$927,0690.00%
Auto Manufacturers1$824,8220.00%
Real Estate—Diversified1$238,1560.00%
Specialty Retail2$227,5490.00%
Aerospace & Defense1$202,9580.00%
Auto Parts1$138,0330.00%
Oil & Gas Integrated1$57,0000.00%
Total149$32,737,762,354100.00%

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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