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How to Trade Pink Sheet Stocks

Updated April 17, 2017

Prices for stocks which are traded in the over-the-counter (OTC) markets are published as so-called "pink sheets" by the National Quotation Bureau. These types of stocks do not fall under the same regulations as those traded on the New York Stock Exchange (NYSE). Therefore, pink sheets stocks are not required to make filings with the U.S. Securities and Exchange Commission. By trading pink sheets successfully, it is possible to make a profit in the OTC markets.

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Find the ticker symbol for the stock. The ticker symbol identifies the stock using an abbreviation. Ticker symbols for pink sheets will always end in ".PK." The ticker symbol for any public company can always be found on its website under the "Investors" or "Investor Relations" section.

Enter the ticker symbol into your broker's search function to get a quote. The quote will show you the price for one share of the stock. For example, if stock ZYX is quoted at £52 per share, this means that one share of ZYX costs £52.

Enter the ticker symbol into your broker's order form and enter the amount you wish to purchase. Using the example from Step 2, if you wanted to purchase 200 shares of ZYX at £52 per share, the calculation would for the total cost of this order would be as follows:

200 x £52 = £10,400

This order would cost £10,400, plus commission.

Place the order. By submitting the order, your broker will automatically fill the trade at the next available price. This trade will execute immediately and you will now own the pink sheets.

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Things You'll Need

  • Online stock broker

About the Author

Steve began writing professionally in 2006, and was published in Financial Markets and Institutions, for his alma mater. He has held positions at wealth management firms, startup companies, a major movie studio, and is CEO of his investment firm. Steve graduated with a Bachelor of Science in business administration from the University of Colorado at Boulder.

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