Paltrowitz of the OTC Markets on the competitive three platforms serving 10,000 companies globally
October 17, 2016 — Jason Paltrowitz, Executive Vice President and Global Head of Business Development at the OTC Markets Group Inc., in an interview with InvestorIntel Sr. Editor Fred Cowans discuss their three tiered markets used by nearly 10,000 U.S. and international securities. Jason explains that their platforms provide “early stage and developing companies a place to be proactive to engage their investors while having some very light touch requirements that aren’t onerous for an early stage company.” Discussing the benefits of listing on the OTCQX and OTCQB, Jason explains that the OTC Markets Group give companies all the benefits of being listed on an exchange at a significantly reduced cost.
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Fred Cowans: OTC, Over the Counter markets used to differ from stock exchanges. Is there any difference in this electronic age?
Jason Paltrowitz: Yes there’s still a difference. The company actually is over 100 years old and started as something called the National Quotation Bureau. It became Pink Sheets, which was a publisher of stock quotes on pink paper. We are now what’s called a ATS, alternative trading system, FCC regulated FINRA member firm. Unlike an exchange, we still trade electronically in a way similar way NASDAQ was before it became an exchange, so a network of broker-dealers that are linking electronically, messaging to trade off-exchange listed securities in the U.S.
Fred Cowans: You have I think something in the range of 10,000 companies listed on your three platforms. What are the three platforms?
Jason Paltrowitz: From lowest to highest, we have what’s called the Pink Market. Pink is that legacy dealer market. It’s an amalgamation of securities ranging from bankrupt all the way up to some of the largest international companies — really where it’s a broker driven trading so companies aren’t involved, but if a broker-dealer in the U.S. wants to trade those securities they can get a ticker symbol. They can apply, get a ticker symbol and trade those securities. It provides a valuable service. If you think of when American Airlines went bankrupt there was a place for their investors to still trade the security. Our next market up is something called OTCQB. That’s what we call our venture market. That has company involvement. It’s got some light touch requirements for companies to be traded there. It gives early stage and developing companies a place to be proactive to engage their investors while having some very light touch requirements that aren’t onerous for an early stage company. Our best market, OTCQX has significant financial requirements. It requires companies have a light touch corporate governance regime put in place and really gives companies all the benefits of being listed on an exchange at a significantly reduced cost so that they can focus on their companies rather than meeting the myriad of requirements that are put in place by the exchanges that might not be suitable for them given their size and scope as a public company….to access the complete interview, click here
Fred’s business career began in 1972 with Canada’s largest bank. In 1989, Fred left the bank’s Treasury Division to provide foreign exchange derivative strategies to ... <Read more about Fred Cowans>