Episode 8 - History of OTC Markets and Relationship to MicroCap Stocks with Jason Paltrowitz, OTC Markets Group
For this episode of the Planet MicroCap Podcast, I wanted to learn more about the relationship and long history between MicroCap stocks and OTC Markets. For clarification, “OTC”, stands for “Over-the-Counter”, which means, as Investopedia defines it as, “a security traded in some context other than on a formal exchange such as the NYSE, TSX, AMEX, etc…” Investopedia breaks it down even further, when it states, “the reason for which a stock is traded over-the-counter is usually because a company is small, making it unable to meet exchange listing requirements.” That sounds a lot like, MicroCap Stocks, right?
However, because of advances in new technology and growing interest in MicroCap stocks, I wanted to find out if the relationship has gotten more complex over the years. To help me with this task, I spoke with Jason Paltrowitz, Executive Vice President of Corporate Services at OTC Markets Group, Inc., who own and operate the Over-the-counter financial marketplaces, OTCQX, OTCQB, and OTC Pink. He is responsible for all international and domestic corporate services.
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In this episode, Mr. Paltrowitz discuss the following topics:
- History of the Over-the-Counter stock markets
- How the OTC Markets came to be
- Description of the OTCQX, OTCQB and OTC Pink markets: what are the differences, qualifications for trading on each, etc...
- How has the OTC Markets globalized the stock market?
- Discusses ADR's, "American Depository Receipt"'s
- How difficult is it for companies to list on multiple exchanges including OTC Markets in the US
- How does market making work together with OTC Markets?
- Why are a big percentage of MicroCap stocks listed on one of the OTC Markets' exchanges?
- Comments on Liquidity
- How does OTC Markets attract new listing companies? And, his view on "Uplisting"
- Mr. Paltrowitz' background
- You can follow the OTC Markets Group on Twitter @OTCMarkets