Sunday, August 28, 2011

OTC Markets Releases New Data

The OTC Markets Newsletter recently published statistics for securities that trade on the OTC Market.  The OTC Markets seem to be growing, and the increases seem to be generally from quality companies, as opposed to “dark” or firms that do not provide much information.  We compared the numbers from 2009, 2010 and the numbers as of 2011.  The OTC Markets have several tiers:

OTCQX - the highest tier for companies that go through a rigorous review and meet certain financial standards. This group has more than tripled in size since 2009:

2009:     78 companies
2010:    159
July 2011:  246

OTCQB - for companies that are "reporting" to the SEC or a banking regulator and are current in their reporting requirements. This group (with the 2009 numbers combined between the OTCBB on Pink Quote and the OTCBB only) saw an increase last year, but has seen a slight drop so far in 2011:

2009:  3,390
2010:  3,851
July 2011: 3,716

The drop could be due to a number of reasons – for example, companies could have voluntarily decided to move to the pink sheets (to save money), or they could have been forced to do so due to failures in their reporting obligations, or they may have been promoted to a higher exchange, either within the OTC Markets, or to NASDAQ or one of the other exchanges.

OTC Pink Current Information - for companies that follow certain standards and make certain information available through the OTC Market's news and disclosure service. This group has risen steadily since 2009:

2009:   1,695
2010:  1,830
July 2011: 2,043

OTC Pink Limited Information - for companies that may or may not be troubled, but have not been current in reporting through the OTC Market's news and disclosure service. This group has remained at about the same number:

2009:  739
2010:  749
July 2011: 723

OTC Pink No Information - which includes "defunct companies that have ceased operations as well as 'dark' companies with questionable management and market disclosure practices." This group rose by a whopping 38% between 2009 and 2010, but has since leveled off.

2009:  2,445
2010:  3,375
July 2011: 3,355