How to Invest to Win in the OTC Market

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By Jesse Schmitt
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Watch your money grow!

With all the bedlam of recent months, many may be afraid of the stock market. Even if you think you can’t afford to get into the market in any real way, the fact is, you can! Follow these steps to potential big gains in the Over the Counter (OTC) Stock Exchange and you could be pick a winner with limited losses!

Difficulty: Easy

Instructions

Things You'll Need:

a small amount of expendable money
DD
guts
time

Step 1

Due Diligence (DD): Before you earn your riches among commoners, you need to do your DD. “Due Diligence.” You have to know some information about the company you’re investing in if you’re going to reap profits. You need to know when to buy, how much, when to sell, and when your investment has turned sour. That said DD will have you riding the upswings instead of chasing the market. The market goes up and down; the simplest way for you to lose money in the market is buy high, sell low, and not ride the down-currents in an otherwise strong stock that’s just going through some troubles. Before you do anything else, do your DD.
Step 2

Fund Your Dreams: You have to have the money in place and you have to have a brokerage account. Lucky for you the money to required to get involved at the OTC market is small and brokerage houses are available everywhere. Fidelity, StrongFunds, TD Ameritrade, and ScottTrade are retail brokerage you hear about all the time. It could pay to do a little bit of research here too. You can often find great programs at your existing bank (Bank of America, Chase, etc…) and often there are people here who can help you out (though they probably will advise against the OTC markets in lieu of mutual funds or something like that; just be clear about what you want and they have to give it to you…or go somewhere else!)
Step 3

Invest Online: You can open up an account, fund your trades, monitor and research your stocks, make buy and sell orders, and collect the profits all online. It’s a great day when the Internet came about; invest with confidence and tinker around with your brokerage houses online services before giving over your loot.
Step 4

OTC/Pinksheets: OTC Stocks (over-the-counter) and Pinksheets are two very viable options depending on your timeline. If you’re nearing retirement than you may want to stay away; however if you’ve got a lot of time, you can make a lot of money for little up-front costs. OTC stocks are just another platform for stocks like the NYSE and NASDAQ, the OTC stock exchange is where new players get in the mix. Everyone wants to be on the big floors but companies have to prove themselves. So they go to the OTC exchange. All sorts of stocks trade here and if you do your DD you may find some stock that’s trading for less than pennies that could be ready to raise the roof! Ride the wave all the way to the top!
Step 5

Give It Time: Once you’ve made your bets, done your DD, opened your account, found your entry point, and taken your position, give it some time. The OTC market is not the place to play with rent money. But if you’ve found a good stock in a promising industry that’s got bright prospects, you may find grand returns in the long run! Consider that 10,000 shares of a stock that’s ¼ a penny will only cost you twenty five bucks; if that stock shoots up to a dime, you’ve just made $975. Onwards and upwards from there!