tag:blogger.com,1999:blog-754894216207950592.post2016296615067224506..comments2024-03-20T15:55:23.392-07:00Comments on NoNameStocks: SEC Wants to Stop Trading in Dark StocksDan Schumhttp://www.blogger.com/profile/05728696891530868697noreply@blogger.comBlogger66125tag:blogger.com,1999:blog-754894216207950592.post-89904491163299302962021-07-28T07:29:00.666-07:002021-07-28T07:29:00.666-07:00current T Rowe Price will allow but I think that w...current T Rowe Price will allow but I think that will be stopping in another month or twoDan Schumhttps://www.blogger.com/profile/05728696891530868697noreply@blogger.comtag:blogger.com,1999:blog-754894216207950592.post-87894955170672444032021-06-17T12:52:22.393-07:002021-06-17T12:52:22.393-07:00with a capital Bwith a capital BDan Schumhttps://www.blogger.com/profile/05728696891530868697noreply@blogger.comtag:blogger.com,1999:blog-754894216207950592.post-35894135145935158352021-06-17T12:52:01.781-07:002021-06-17T12:52:01.781-07:00probably because the latest period ETCC reported f...probably because the latest period ETCC reported for ended 11/30/2020 and it's now 6 1/2 months laterDan Schumhttps://www.blogger.com/profile/05728696891530868697noreply@blogger.comtag:blogger.com,1999:blog-754894216207950592.post-31784029205049876942021-06-17T12:13:25.534-07:002021-06-17T12:13:25.534-07:00Hi Dan
any Idea why ETCC has Stop sigh: Pink No In...Hi Dan<br />any Idea why ETCC has Stop sigh: Pink No Information?<br />They have all the reports uploaded under disclosure , but not under SEC section<br />https://www.otcmarkets.com/stock/ETCC/disclosureiotahttps://www.blogger.com/profile/04353887412722440077noreply@blogger.comtag:blogger.com,1999:blog-754894216207950592.post-85856312242654766592021-06-08T08:56:54.415-07:002021-06-08T08:56:54.415-07:00Does anyone know of any firms which still allow yo...Does anyone know of any firms which still allow you to buy OTC caveat emptor stocks? The handful that I asked (Schwab, TDA, Fido, etc) are just in liquidation only.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-754894216207950592.post-30597015040876384412021-01-03T10:13:27.686-08:002021-01-03T10:13:27.686-08:00file number S7-23-20 submitted Dec 22, 2020 here: ...file number S7-23-20 submitted Dec 22, 2020 here: <br /><br />https://www.sec.gov/rules/exorders.shtmlDan Schumhttps://www.blogger.com/profile/05728696891530868697noreply@blogger.comtag:blogger.com,1999:blog-754894216207950592.post-91863675309007842342021-01-03T10:08:16.772-08:002021-01-03T10:08:16.772-08:00Well the OTC Markets "expert market" is ...Well the OTC Markets "expert market" is progressing. I'm not certain if that's a great solution but it's something and is moving forward. <br /><br />The SEC now has a proposal to grant OTC Markets an exemption from this rule for their Expert Market. I don't know all the details but it would not be accessible to everyone. <br /><br />"quotations published or submitted on the Expert Market would be limited exclusively to market data distributors, including Subscribers, and certain types of sophisticated or professional investors, specifically, the following categories of market participants (each, a “Qualified Expert” and collectively, the “Qualified Experts”): (1) any qualified institutional buyer, as defined in Rule 144(A)(a)(1) under the Securities Act; and (2) any accredited investor, as defined in Rule 501(a) of Regulation D;15 and (3) any qualified purchaser, as defined in Section 2(a)(51)(A) of the Investment Company Act of 1940 (the “Investment Company Act”) and the rules thereunder."<br /><br />https://www.sec.gov/rules/exorders/2020/34-90769.pdfDan Schumhttps://www.blogger.com/profile/05728696891530868697noreply@blogger.comtag:blogger.com,1999:blog-754894216207950592.post-76854067213965811652020-09-29T17:59:03.638-07:002020-09-29T17:59:03.638-07:00Maybe there's an opportunity for someone to la...Maybe there's an opportunity for someone to launch a brokerage specializing in these types of securities...?Shanenoreply@blogger.comtag:blogger.com,1999:blog-754894216207950592.post-49030332820995870552020-09-24T21:56:33.064-07:002020-09-24T21:56:33.064-07:00yeah any info Schwab displays as far as "limi...yeah any info Schwab displays as far as "limited" or "no info" I'd bet is directly taken from the otcmarkets data list. <br /><br />The stop sign at otcmarkets is annoying. They have this valid Limited Info tier which is once per year filing but then they still put up the stop sign for half the year because that's based on filing every 6 months. Dan Schumhttps://www.blogger.com/profile/05728696891530868697noreply@blogger.comtag:blogger.com,1999:blog-754894216207950592.post-30708597653623161482020-09-24T21:44:40.142-07:002020-09-24T21:44:40.142-07:00Makes sense, definitely have to consider the poten...Makes sense, definitely have to consider the potential positive as well. I have a small position in HYDI, that is why i ask. I figured they would show as limited rather than no info. I really appreciate your thoughts on all of this.Markhttps://www.blogger.com/profile/15350288303949096929noreply@blogger.comtag:blogger.com,1999:blog-754894216207950592.post-42575508036883824342020-09-24T21:38:31.546-07:002020-09-24T21:38:31.546-07:00HYDI has the stop sign at otcmarkets. They do tha...HYDI has the stop sign at otcmarkets. They do that if a company doesn't file every 6 months. More info here: http://www.nonamestocks.com/2016/10/brokerage-firms-otc-markets-and-dark.html<br /><br />So yes HYDI falls into the category of non-current filers and the stock is at risk. And yes it's my largest position at the moment. slightly larger than CVV. <br /><br />I will wait and see what happens. There's always risk. With HYDI specifically I feel like they want the stock to do well and so I think this SEC rule might actually kick them in the pants to be current. "might" being the key word thereDan Schumhttps://www.blogger.com/profile/05728696891530868697noreply@blogger.comtag:blogger.com,1999:blog-754894216207950592.post-70503541864249408762020-09-24T21:14:11.939-07:002020-09-24T21:14:11.939-07:00Dan,
Based on your last update of your portfolio,...Dan,<br /><br />Based on your last update of your portfolio, I assume you are saying your largest holding is HYDI. I understand if you don't want to disclose, but I think this brings up an interesting topic. When I look at OTC Markets, HYDI has at least released their 2019 annual report. I use Schwab and they label it as "no information." This is the part that made me nervous about any OTC stocks. I realize it is probably irrational, but I have a material (to me) amount invested in these. Do you see this as Schwab not having it updated or needing quarterly reports? Markhttps://www.blogger.com/profile/15350288303949096929noreply@blogger.comtag:blogger.com,1999:blog-754894216207950592.post-3056512258638036482020-09-22T22:06:04.421-07:002020-09-22T22:06:04.421-07:00Braxton I feel your pain. All valid points. All ...Braxton I feel your pain. All valid points. All brought up to the SEC and they didn't care. <br /><br />If stocks just move to the grey market I'd be OK with that. I can still trade that<br /><br />I wonder if some will end up on otcmarkets "Expert Market". I don't know much about that one so I've got some reading to do. I know the rules to be considered accredited recently got modified so maybe it'll be easier for individual investors to transact there. Dan Schumhttps://www.blogger.com/profile/05728696891530868697noreply@blogger.comtag:blogger.com,1999:blog-754894216207950592.post-58314553904514494342020-09-22T09:33:42.941-07:002020-09-22T09:33:42.941-07:00Hi Mark.
OTC current I don't think will hav...Hi Mark. <br /><br />OTC current I don't think will have any issue. My guess is the problems will only be with the stop sign or skull and cross-bones stocks on otcmarkets. <br /><br />No I'm not making any moves based on this. I'm just waiting. I have been selling some stocks recently for living expenses but that's unrelated. I am thinking about but haven't done anything. Overall it's not that huge a part of my portfolio that is in dark stocks. I think my largest holding is a stop sign stock though. So it's a mixed bag on my endDan Schumhttps://www.blogger.com/profile/05728696891530868697noreply@blogger.comtag:blogger.com,1999:blog-754894216207950592.post-75912473815003043592020-09-21T20:17:46.960-07:002020-09-21T20:17:46.960-07:00Hi Dan,
Obviously, this is terrible news. I'...Hi Dan,<br /><br />Obviously, this is terrible news. I'm working on liquidating a few positions, but also concerned about some others. What are your thoughts on stocks that show as trading OTC current info? I am a little concerned that a lot of brokerages will also cut these as well to make things easier for themselves. Are you making moves based on this? Markhttps://www.blogger.com/profile/15350288303949096929noreply@blogger.comtag:blogger.com,1999:blog-754894216207950592.post-59765760471802402272020-09-19T13:36:47.885-07:002020-09-19T13:36:47.885-07:00This probably means that the price of dark shares ...This probably means that the price of dark shares will fall. Investors will sell them, because they are afraid that they cannot trade them anymore. Michuhttps://www.blogger.com/profile/03414971091277943787noreply@blogger.comtag:blogger.com,1999:blog-754894216207950592.post-47282509813346885782020-09-17T12:12:20.494-07:002020-09-17T12:12:20.494-07:00I remain appalled by the final rule's fundamen...I remain appalled by the final rule's fundamental injustice. Even if it does not categorically bar investors from transacting dark stocks (they can still be traded on the grey market), it is certain that liquidity will dry up precipitously. Brokers will undoubtedly take a very conservative stance in applying the rule, impairing the market value of existing investors' holdings.<br /><br />Blocking the publication of quotes on dark stocks will ostensibly cause managements to get religion and start putting out financials. But color me skeptical. I can picture Richard DePiano Jr. tap dancing to work after hearing the news. The incentives are clearly out of whack: fiduciaries who are already looting shareholder money would like nothing more than to go about it more conveniently.<br /><br />The only ones who will be hurt are shareholders. The odd pump and dump shell that doesn't file on OTC Markets can correct that easily enough, and it would be naive to believe that the actual financial situation of the companies will matter in the slightest to the sorts who fall for pump and dump schemes. At best, this rule will move pump and dumps from the pink sheets to the NASDAQ and NYSE, as was already happening.Braxton Gannhttps://www.blogger.com/profile/00024264900264476611noreply@blogger.comtag:blogger.com,1999:blog-754894216207950592.post-1751489275341867032020-09-16T21:57:52.800-07:002020-09-16T21:57:52.800-07:00well they went through with it. makes me so sad. ...well they went through with it. makes me so sad. <br /><br />press release here: <br />https://www.sec.gov/news/public-statement/clayton-otc-2020-09-16<br /><br />and full rule here:<br />https://www.sec.gov/rules/final/2020/33-10842.pdf<br /><br />I'll get started reading the full thingDan Schumhttps://www.blogger.com/profile/05728696891530868697noreply@blogger.comtag:blogger.com,1999:blog-754894216207950592.post-38330110026862918162020-07-24T14:09:34.349-07:002020-07-24T14:09:34.349-07:00sadsadM.aniqhttps://www.blogger.com/profile/06409390531800554627noreply@blogger.comtag:blogger.com,1999:blog-754894216207950592.post-70063404324823362492019-12-18T01:16:22.209-08:002019-12-18T01:16:22.209-08:00hmmhmmdonghttps://www.blogger.com/profile/14066144842786874096noreply@blogger.comtag:blogger.com,1999:blog-754894216207950592.post-85518165475498578602019-12-11T07:24:57.325-08:002019-12-11T07:24:57.325-08:00It's also on the Planet MicroCap Podcast here:...It's also on the Planet MicroCap Podcast here: https://planetmicrocap.podbean.com/e/ep-102-sec-wants-to-stop-trading-in-dark-stocks-with-dan-schum-nonamestockscom/Dan Schumhttps://www.blogger.com/profile/05728696891530868697noreply@blogger.comtag:blogger.com,1999:blog-754894216207950592.post-37624728707278160922019-10-29T14:24:14.900-07:002019-10-29T14:24:14.900-07:00"Companies that want to have their stocks tra...<br />"Companies that want to have their stocks trade will man up and provide financials. For those that don't, so what? There are thousands of publicly traded companies you can choose from (including 100s of microcaps). The idea that it's somehow in the public interest (or investors' interest) to have all these dark companies publicly trading is strange to me. I agree with the SEC on this one." <br /><br /><br />I actually believe most of the scammers will comply, but I also believe many of the family-owned businesses won't and then will purposefully NOT provide updated financials, as many couldn't care less about their stock price. You go where the bargains are and there are some real gems in this space. They are generally very illiquid, but with patience you can build a significant position. For years, SIMA traded below its net cash levels. At its low, SIMA was trading at 10 cents a share with $5/share in net cash and a good business. Pretty sure you won't find similar bargains elsewhere. <br /><br /><br /><br /><br /><br />"HAUP, you bought an already dark stock. Management doesn't care about you, as they have made clear. They don't provide you with any info and likely never will. You knew all of this prior to buying (I assume) and thought you could pressure them into providing financial info. That's all well and good and I wish you the best of luck with HAUP. But how does the SEC's proposed rule hurt you in this case? I don't see that it does at all. BTW, you also haven't responded on the HAUP point. The new rule would force them to do exactly what your HAUP posts are crying out for - for them to provide their financials. Isn't this what you want?"<br /><br /><br /><br />I'm afraid you have it backwards. The 'stick' the SEC is using is no public quotes for companies that don't file updated financials. That doesn't force HAUP to file their financials, in fact, HAUP would treat the penalty as a 'carrot' because that is exactly what they want. You should not be rewarded for actions that deserve a penalty. The SEC should get together with all the various state agencies and hammer out some rules that require updated financials. If they do not comply, then penalize the companies, management, and insiders, NOT the outside shareholders. <br /><br />JJRhttps://www.blogger.com/profile/12802197298585305592noreply@blogger.comtag:blogger.com,1999:blog-754894216207950592.post-41488392661693342342019-10-29T13:57:01.550-07:002019-10-29T13:57:01.550-07:00Sklarquist, I think everybody agrees that what the...Sklarquist, I think everybody agrees that what the SEC is trying to accomplish is a good idea. No one wants to see investors getting ripped off by scammers. There are a lot of OTC 'pump and dump' schemes, but the way the SEC is attempting to do it will NOT solve the problem and it actually creates a new one. <br /><br />Think about it, scammers require a stock that trades, so they will follow the letter of the law and post their vaporware financials. They are well aware that another breathless press release will get the unsophisticated mo-mo crowd excited. Many of the folks in this space couldn't care less about a company's financials as long as the stock is 'showing some action". So the crooks will post their financials and penny stocks will continue to soar and crash.<br /><br />The unintended consequence for profitable companies who do not post their financials is not allowing broker-dealers to quote their stock price. So while hundreds of scammers will now post their financials, many other legitimate insider-owned companies will welcome the idea of not having to post updated financials any longer because they don't care if their stock trades. <br /><br /><br /><br /><br />"The proposed rule actually prevents these investors from being hurt, b/c the stock will immediately cease trading and they won't feel pressured to sell out at $0.02/share."<br /><br /><br />Would your portfolio take a mark-to-market hit if your stocks stopped trading? There are deep value investors in the OTC space and while we certainly don't need an actively traded stock, we also don't want public trading to completely shut down. <br /><br /><br /><br /><br />"The only reason you got SIMA so cheap was b/c the SEC allowed the stock to keep trading despite no public info being available. That's EXACTLY the scenario the SEC is trying to address and prevent in the future. FWIW this seems totally reasonable to me - in other words, if a company wants it's stock to trade publicly, they have to make available publicly updated financial info."<br /><br /><br />The SEC wants publicly traded companies to provide current financials, that's obviously something that investors also want. But the SEC's 'carrot and stick' approach falls far from the mark. Many companies (including SIMA) would love to not be bothered by pesky minority shareholders. Unlike past years, this year they are requiring an onerous NDA to be signed in order to get the 2018 AR. If this SEC rule passes, they would love to not provide current financials if it resulted in a stock price that was no longer quoted. <br /><br /><br /><br />"If companies like HAUP and SIMA start providing their updated financials, liquidity in their stocks should improve dramatically, which is a good thing whether you want to buy more or sell."<br /><br /><br />The opposite is also true. If the companies refuse to post updated financials, then liquidity dries up completely. Both these companies would like nothing better. <br /><br /><br /><br /><br /><br />"I have zero problem with, for example, you or anyone else buying SIMA at $0.05/share even though any reasonable analysis shows it's worth $2/share, SO LONG AS THE RELEVANT FINANCIAL INFO IS AVAILABLE to both you and the seller."<br /><br /><br />With the exception of HAUP, which I'm now suing and will win since they have no leg to stand on, I've never been refused the financials of any company I owned. So all shareholders can get the financials, but they often make us jump through hoops to get them. If this SEC rule proposal passes, that will no longer be the case. <br />JJRhttps://www.blogger.com/profile/12802197298585305592noreply@blogger.comtag:blogger.com,1999:blog-754894216207950592.post-50910233428278211072019-10-22T11:42:32.692-07:002019-10-22T11:42:32.692-07:00I did a video interview on this with Robert Kraft ...I did a video interview on this with Robert Kraft of stocknewsnow.com. You can see it here: https://www.youtube.com/watch?v=d2dzVETwKFkDan Schumhttps://www.blogger.com/profile/05728696891530868697noreply@blogger.comtag:blogger.com,1999:blog-754894216207950592.post-35421266883746866522019-10-17T07:18:51.710-07:002019-10-17T07:18:51.710-07:00I think if shares do not trade anymore, the value ...I think if shares do not trade anymore, the value of a stock is strongly related to the dividend yield. (Unfortunatly, most of the stocks covered here by Dan do not pay any dividends). Michuhttps://www.blogger.com/profile/03414971091277943787noreply@blogger.com