A question that I’m asked over and over again by new traders is what will happen to their OTCBB stock should it move from the OTCBB to a major exchange like the NASDAQ.
Your brokerage firm (Scottrade, Etrade, etc.) or your post office will keep you informed of any special changes or actions you must take but usually, no action is needed on your part. Your shares will automatically convert into the new ticker symbol traded on the Nasdaq or major exchange.
Investors call this a jumper stock. The odds are that your stock will increase in value once it starts trading on a major exchange because it’s open to a whole new pool of investors.
If any change in the ticker symbol takes place, your brokerage firm (i.e. ETrade, Scottrade, etc.) will contact you via your trading console and/or by regular mail.
Time for some brutal honesty. You are George Bush stupid if you are investing in OTC stock you think will go to the NASDAQ.
Con-vest publishing companies are more than happy to sell you a subscription to their OTC to Nasdaq stocks. Don’t be a sucker.
In the hundreds of traders I’ve spoke with over the years, not one of them has told me that he made money from picking jumper stocks more than he lost.
Time for another dose of reality. Drink up. It doesn’t cost that much more for a listing on a major exchange as it does on the OTCBB. If the company was such a good company, selling such a hot product, that had this great potential to jump from the OTC to the Nasdaq, then why didn’t they just list on the Nasdaq in the first place? Hmmmmm? The main different between the two listings is not money, but the additional reporting requirements. Companies that list on the OTCBB don’t want to disclose to investors what’s really going on behind the PRs and they sure as hell don’t want to provide this information on anything remotely close to a timely and regular basis.
Enlightening truth: the primary reason a company lists on the OTC instead of the NASDAQ is to not have to meet the higher reporting requirements for that listing. They really don’t want to be bothered with letting investors know what is REALLY going on behind all the PRs they release.
The only exchange fraught with more danger than the OTCBB is the pink sheets. But still, the OTCBB has thousands of fraudulent companies listed on it that will be delisted within a year and the CEO brought up on fraud charges by the SEC. Over many years, investing in the OTCBB because you want to bag a jumper stock will make you go broke. I should know, it happened to me. Yes, I’m a former jumper stock investor. As the saying goes, he who has grabbed a bull by the tail knows twice as much as he who never has. Don’t go grab the bull by the tail. Learn from my painful experience.
Here’s something to think about. The main reason people gamble in the OTCBB market is to get really cheap stocks. Now that we are at a market bottom, many good companies listed on major exchanges are at very low OTCBB like prices!
Tags: Finance, investing, what happens to my stock when it goes from otc to nasdaq, what happens to otc stocks, what happens to stock when a company changes markets, what happens when companies get listed on the nasdaq, what happens when stock moves from otc to nasdaq