Pink sheets

The pink sheets are an over-the-counter market for stocks that are not listed on a major exchange like the NYSE or Nasdaq. The name comes from the pink paper that dealer quotes were once printed on decades ago, before the market moved to electronic quoting.

Today the pink sheets are one of the lowest and least regulated tiers operated by OTC Markets Group, sitting below the higher OTCQX and OTCQB tiers, which require companies to meet stronger financial reporting and disclosure standards. Only the Expert Market, for securities with no current public information, sits lower. Companies on the pink sheets often provide minimal or outdated financial information, and some have stopped filing regular reports with the SEC altogether.

Stocks land on the pink sheets for a range of reasons, from small or early-stage companies that have never met a major exchange's listing requirements, to formerly listed companies that were delisted due to financial trouble or falling share prices. Because of the light disclosure standards and thin trading typical of this market, pink sheet stocks carry meaningfully more risk than exchange-listed shares, and thorough independent research matters even more than usual before buying one.