How are Penny Stocks traded?
Most penny stocks are traded in the over the-counter (OTC) market, as opposed to the national securities exchanges such as the New York Stock Exchange, the American Stock Exchange, and the Midwest Stock Exchange. The number of shares traded (volume) and the price information on exchange-listed stocks and certain OTC stocks is continuously collected and reported to the public. But current price and volume information about most penny stocks is not made available to the public. Brokerage firms trading penny stocks usually provide information only about the trades they make themselves. As a result, the investor may not know that a better price is available elsewhere, or worse, that there is no other brokerage firm willing to buy or sell these stocks.
