Over the Counter Shares

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Maverick3320
Posts: 438
Joined: Tue May 12, 2015 2:59 pm

Over the Counter Shares

Post by Maverick3320 » Fri Sep 11, 2015 11:15 am

I recently have become somewhat enamored with a stock that, to my surprise, is only available (at least through Vanguard brokerage) via over the counter shares.

Does anyone have any experience trading in over the counter shares? It seems a bit more risky, but this a 20 billion+ market cap company. Anything else to watch out for? Any liquidity issues?

YttriumNitrate
Posts: 1062
Joined: Tue Mar 26, 2013 12:13 pm

Re: Over the Counter Shares

Post by YttriumNitrate » Fri Sep 11, 2015 11:51 am

Is the company a large foreign company that doesn't want the hassle/expense of being listed on a more reputable market?
http://www.bloomberg.com/bw/magazine/co ... 995629.htm

barnaclebob
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Joined: Thu Aug 09, 2012 10:54 am

Re: Over the Counter Shares

Post by barnaclebob » Fri Sep 11, 2015 12:27 pm

Enamored implies your judgment is clouded.

Maverick3320
Posts: 438
Joined: Tue May 12, 2015 2:59 pm

Re: Over the Counter Shares

Post by Maverick3320 » Sat Sep 12, 2015 8:01 am

YttriumNitrate wrote:Is the company a large foreign company that doesn't want the hassle/expense of being listed on a more reputable market?
http://www.bloomberg.com/bw/magazine/co ... 995629.htm
It's Standard Chartered. Market cap of 18 billion. They are listed on the London and Hong Kong exchanges. For some reason, I can only buy over the counter shares through the Vanguard brokerage.

bawr
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Joined: Thu May 19, 2011 9:10 pm

Re: Over the Counter Shares

Post by bawr » Sat Sep 12, 2015 9:00 am

Standard Chartered is traded on the OTC Pink Sheets as SCBFF. The average daily volume is minuscule, at just over 5,000 shares. I suspect the bid offer spread for SCBFF is going to be unfavourable.

If I wanted to buy this stock, I would execute the transaction on the Hong Kong exchange (symbol: 2888) via Interactive Brokers. The market there is liquid (> 1M shares) and the stamp duty, at 0.1% per side, is less than the UK's 0.5% (buy side only).

Maverick3320
Posts: 438
Joined: Tue May 12, 2015 2:59 pm

Re: Over the Counter Shares

Post by Maverick3320 » Mon Sep 14, 2015 8:58 am

bawr wrote:Standard Chartered is traded on the OTC Pink Sheets as SCBFF. The average daily volume is minuscule, at just over 5,000 shares. I suspect the bid offer spread for SCBFF is going to be unfavourable.

If I wanted to buy this stock, I would execute the transaction on the Hong Kong exchange (symbol: 2888) via Interactive Brokers. The market there is liquid (> 1M shares) and the stamp duty, at 0.1% per side, is less than the UK's 0.5% (buy side only).
Thank you!

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