Free Stock Trading / Pink Sheet Broker

If you are looking for investments off of the beaten path, you should consider using the services of a pink sheet broker. You may have heard of pink sheets called Over-the-counter bulletin board stocks, or BB stocks, but they are all the same thing. A pink sheet broker will let you access the over-the-counter markets and purchase stock in unlisted corporations, that is, corporations that do not meet the stringent listing requirements of the major American stock exchanges. Pink sheet trading is attractive for a few reasons. Primarily, the over-the-counter market is good if you are a novice investor without a large amount of capital to build up your portfolio. Because pink sheet stocks are usually offered by smaller corporations, the price of the stocks are lower, allowing you to develop a more diversified portfolio than if you were purchasing expensive blue chip stocks off of the NYSE. And as long as you never invest too much money in any on pink sheet stock, you should not be exposed to too much exposure. When you do not have as much money invested in any one stock, you will not be hit as hard financially when its price drops. The chance to receive an impressive return is also there because any movement in a pink sheet stock’s price will probably result in dramatic movement. Of course, this movement could go either way. If you only paid a few dollars for a pink sheet stock, it does not have to rise in price too much for you to make an impressive profit. This is, of course, the major drawback to investing your money through a pink sheet broker; because pink sheet stocks do not meet the listing requirements, they are generally less stable corporations and thus present a riskier investment.

If you are interested in trading pink stocks, you are likely looking into online stock trading options. Online trading is a great opportunity for investors to escape from oppressive brokerage fees. Indeed, some online trading services even offer free stock trading. You should look carefully into the service before signing up with a free stock trading service, however. Most of the free online services make money by investing the margin and cash balances clients keep stored in their accounts. For this reason, free stock trading services will usually require you to keep a quite substantial balance; when they are not making money per transaction, they need to ensure that you have sufficient funds in your account for them to use. Also, free services will likely limit the number of free transactions you can perform every day or month. Further, free services, since they are, after all, free, can probably not be expected to offer as good customer service as even a discount brokerage service that operates on a flat fee basis. All in all, unless you are content to sign up for a service where profits are made solely from your money, it will be to your benefit to sign up with a flat fee online stock trading service.