What Are Pink Sheet Stocks? - YouTube

- A lot of people ask me questions,

what are pink sheet stocks?

What are gray sheet stocks?

Well, in this video I explain.

(upbear music)

What's up?

Tim Sykes, Millionaire Mentor and Trader,

here answering your questions.

A lot of people ask me

what is a pink sheet stock?

What is a gray sheet stock?

What is the NASDAQ?

What is the OTC Bulletin Boards?

There's like this whole realm of penny stocks

that no one really knows about and frankly I do.

I've been trading 20 years now, 20 years in penny stocks.

Insane to say it out loud, I'm surprised sometimes.

But I've made roughly five million dollars in that time.

A lot of the time I'm trading with a small account

in order to teach.

I now have five millionaire students

with several students coming up making six figures.

That's best case scenario for penny stocks.

It's a very small niche.

A lot of people say why aren't more people involved?

'Cause this is the smallest strangest sketchiest niche

in all of the stock market.

Why do I focus on it?

Heck if I know.

Probably just because it's made me a millionaire, you know?

From trading it to now having experience

to now being pretty much one of the best teachers.

I don't know if I'm the best.

I know I'm not the best trader

but I do have a lot of successful students,

and now my top students all help me mentor other people.

So, how do you actually get involved with penny stocks?

Well, you have to know the basics.

Click the link just below this video for a free guide.

I'm gonna give you just all the basics.

Knowing about pink sheets, gray sheets,

OTC Bulletin Board, NASDAQ,

these are different exchanges

that penny stocks are traded on,

but you need to watch this free guide,

you need to learn it,

you need to recognize

all the vocabulary

and all the terminology

and all the different strategies involved.

It's not rocket science but there does

need some time required,

like you do need to study up,

you do need to understand that preparation is key.

It's not about finding any one hot penny stock

or finding some hot new investment,

they're almost all full of crap though,

almost all fail if you look at the stats.

So why are they called pink sheets?

Why are they called gray sheets?

What's NASDAQ?

These are different exchanges.

Pink sheets and gray sheets are like

the sketchiest of the sketchy for penny stocks.

A lot of these companies don't have financial filings.

They're talking about changing the rules

like where all these companies should have financial filings

so you can see their abhorrent financial condition.

They have very little cash,

very little in the way of revenues.

Losses, debts, like if you can come up with

your idea of like the worst company possible,

that's most pink sheets.

I'm sorry to be the bearer of bad news,

but there is good news because just because

a company is in bad financial shape

does not mean that it's a bad stock.

It's kind of interesting.

The best stocks, the best performing stocks,

sometimes have the worst financials,

they just have potential.

And to be fair many of these startups,

how do you get good financials

when you don't have your product?

You're developing a very speculative product.

So this is what a lot of pink sheets

and gray sheets stocks are.

Why are they called pink sheets and gray sheets?

Well, a few decades ago when these stocks

were traded literally over sheets of paper,

like brokers had to write out orders

and on that sheet of paper,

on that slip it was a pink sheet or a gray sheet.

There were two different colors

based on how bad the companies were.

It doesn't matter whether they're pink sheets or gray sheets

or other OTC or Over-the-counter Bulletin Board,

just know they are all very

speculative crappy little companies

with maybe one, maybe two products,

very little cash, very high degree of risk.

And for you as a trader or investor,

it's oftentimes difficult

to get executed on your buys or sells.

You can put in an order,

within a few seconds get executed like that

on a NASDAQ, New York Stock Exchange type stock.

With a pink sheet or gray sheet, it's not so simple.

Sometimes the market makers take several minutes.

So if you're buying a stock that's spiking big

with a pink sheet or gray sheet,

you might wanna use a limit

that's above the price.

Like if the gray sheet or pink sheet stock

is trading at $2 a share,

I might use $2.20 a share as my limit

because I know it's gonna take a few minutes to execute

and I want to give a little leeway for slippage.

If I'm selling a stock, same thing,

I wanna give it like an extra five or 10%

just to make sure I get executed

because the bad thing about these pink sheets

and gray sheets and all these sketchy penny stocks,

if it is panicking, going against you when you're long,

it's very difficult to get out.

You might put your limit price

and the stock will just panic right below it,

and you might be in a stock that drops 90% in a few minutes.

So you had to be aware of that ahead of time.

The good news is if there is good news in the company

and you're buying a stock

and you know that's it difficult to get executed,

you can put your limit order above the current price,

let's say a pink sheet stock announces a deal with Apple,

it's been known to happen.

And some of these little sketchy companies

that have very little finance, very little credibility,

if they get a big vote of confidence from a big company,

the stock can double or triple

not just over a few minutes or hours but days or weeks.

And if you are aware of how hard it is to get executed,

guess what, you could buy the stock and just hold it

because you know other people,

they're gonna be trying to get in,

they might not be as prepared as you,

they might not watch my videos

and know to put in the limit price

so they're gonna keep missing it,

they're gonna keep putting new and new buy orders

and keep pushing the stock price up,

and you can ride the wave

because theoretically

you'll have listened to me

because I know what the heck I'm talking about,

and you'll already be in the stock

as others are trying to get in and failing miserably

in putting the stock price higher and higher.

So it's good to know.

These are just a few basics.

Again click the link just below this video

if you wanna learn from my free guide.

It's all about education and preparation.

No one company can make you rich,

but one stock poorly planned,

one trade can make you poor

especially if you go all the way

and don't use leverage

which I suggest you not do.

I trade very safely.

Yes, I've made five million dollars

in the sketchiest niche

but I trade cowardly,

and I highly recommend

trading like a mother duckin' coward.

Leave your comments just below this video too,

let me know what you think.

Hey, Tim Sykes, Millionaire Mentor and Trader.

Thank you for watching my videos.

I hope that they help you.

I wanna share everything

that I've learned over the years.

You can check out more videos right over there,

and also click Subscribe so that you can watch

all of these videos, get that knowledge,

and become my next millionaire student.