NYSE MKT PennyStocks. . .
The American Stock Exchange,
• became the NYSE Amex Equities on Oct 1st, 2008.
• is now the NYSE MKT LLC effective May 14, 2012.
Small Cap and Micro Cap Stocks
This stock exchange functions to trade small cap and micro cap stocks, which is the reason for the focus on NYSE MKT pennystocks trading.
Micro-Cap stocks (Penny Stocks) on this Exchange are Listed Securities being traded on a SEC authorized Stock Exchange. Therefore, penny stocks on this exchange are under a review board.
This means that stocks on this exchange are considered by stock traders to be of high quality in comparison to the unlisted penny stocks on the OTCBB. So, you are going to see higher volume of trading with penny stocks on the NYSE MKT.
NYSE MKT Penny stock Trading is a little different than trading penny stocks on the Nasdaq or NYSE. This page describes those differences within the NYSE MARKET and how you can trade profitably knowing these difference.
Just like the NYSE, this exchange is an auction market.
Trades are conducted mostly electronically on this exchange in the auction market format.
What this means is that all trades directed to this exchange are facilitated by one Market Specialist (Designated Market Maker or DMM) whose job is to match buy and sell orders.
If your trades are handled through an online broker, your order may be routed to one or more of several sources to be filled - if possible. . .
• Your online broker may automatically route your order directly to the NYSE MKT and then directed to a Market Specialist (Designated Market Maker or DMM) of your target stock.
Rarely, if ever, will a penny stock be routed to a floor broker, and probably never for penny stocks.
The Market Specialist, through the use of the electronic display book - the Universal Trading Platform (UTP) - efficiently matches your order with another order to create a fill if possible.
The UTP is fully automated, international in scope, and lightning fast.
NOTE: UTP replaces the NYSE's matching engine, Display Book (DBK), and supporting database Super Display Book (SDBK) and is universally available to trade all NYSE Euronext Stocks soon.
• Your online broker may also automatically route your order of the stock to a Third Market-Maker - not to be confused with the Designated Market Maker (Market Specialist). Any number of third market-makers trade a stock on the open market.
The Third Market Maker is similar to a market maker (dealer-broker) of the dealer-market (described under NASDAQ on this site) in that their trading activity helps keep stock trading liquid.
The difference is that the Third Market-Maker is not appointed by the exchange as are Market Makers; rather, they are registered trader NYSE members who trade from their own accounts on that security providing additional liquidity and price stability.
The Third Market Maker can, at times, actually provide a better quote price for you than when matched by a Market Specialist of a security (stock).
• Your online broker may also route your order to one of five regional exchanges as listed on the NYSE page of this site.
• Your online order may be routed to an ECN (Electronic Communications Network) to be filled, if the quote price is better than on the Exchange.
Besides getting you a possibly better fill for your order, your online broker will likely also receive a commission from a third market-maker or a regional exchange for placing an order through them.
NYSE MKT PennyStocks Tracking:
Google Finance and Yahoo Finance are two free easy to use sources to view real time quoting and charting for NYSE Market pennystocks.
FinViz is also popular, and a good choice.
Your online broker account (with any good brokerage firm) will provide free access to real-time streaming quotes and charts that display quotes live of most securities. In a later topic, this site gives advice on online penny stock friendly brokerage services.
NYSE MKT Pennystocks Trading:
Thoughts to Build Strategies
Here are some interesting thoughts that help us understand the kind of penny stocks trading on the NYSE MKT:
• This exchange has more liberal regulations than either the NYSE or NASDAQ in that the NYSE MKT review board looks at each company more subjectively on its own real and perceived merits and potential, thus waiving the more strict written requirements in many instances when a company does not measure up to those rules.
• This stock exchange is far smaller than either the NYSE or the NASDAQ handling about 10% of all trades made in the US.
• This exchange, as noted earlier, functions as a small-cap and micro cap equities (stocks) exchange.
NOTE on NYSE AMEX Options:
NYSE MKT associated options market will continue to do business under the name NYSE Amex Options.
The NYSE MKT also trades ITF's and I-Shares.
Both of these securities are like mini-mutual funds consisting of a class or composite of securities that you can trade just like regular stocks. Some investors who desire to trade in the foreign markets but within the US Stock Market do so by trading ITF's.
More trading of ITF's occurs on the NYSE MKT than anywhere else.
NYSE MKT pennystocks are mainly micro-cap stocks.
Nano-cap stocks trade on this exchange as well due to the qualitative review of each stock by the the NYSE MKT Review Board, which relaxes the written listing requirements for struggling but otherwise high potential stocks.
I will review the written listing requirements shortly.
NYSE MKT PennyStocks and Basher Campaigns
NYSE MKT pennystocks, are pretty high caliber because the NYSE MKT review board does watch them like a hawk.
Even so, marketeer stock basher involvement is high and highly organized. Don't let the stock basher dupe you out of a good trade or dupe you into a bad trade.
As well, don't underestimate the highly organized larger basher campaigns that frequent the NYSE MKT. Such basher campaigns can actually drag a fairly good company down that may otherwise have succeeded.
The stock basher likes to take advantage of the fact that many investors look at penny type stocks with suspicion or paranoia, as if all are potentially scams. The stock basher scares shaky investors into selling their shares of good but struggling stocks driving share prices down.
The stock basher will short shares of such stock and ride it down on bad news they create to rattle investors. Then, if the stock is still viable, they buy up shares at discount values after the stock bashing campaign is complete and begin promoting the stock.
The NYSE MKT is a favorable environment for stock bashing.
Why?
1. The stock basher takes advantage of the difference between the strict written regulations and the more liberal leeway the review board commonly grants to struggling companies.
2. Easy to short most stocks traded on this exchange because they are listed securities.
3. NYSE MKT pennystocks are not normally as thinly traded as OTC stocks, but not as heavily traded as Nasdaq penny stocks. This happy medium is favorable for large organized marketeer involvement.
The marketeer stock basher scheme includes scaring traders and investors into selling a particular stock by harping on the fact that the company is not in compliance with the written regulations and could be delisted any time.
NYSE MKT PennyStocks: The Written vs Qualitative Review
Even though the review board of this stock exchange watches penny stocks like a hawk, and have written listing requirements active, they are reasonable.
The review board will be lenient with companies that are struggling, temporarily suspending written regulations in an attempt to give such companies a reasonable opportunity to succeed and comply.
Most other stock exchanges are similar in this regard, but the NYSE MKT is more so.
NYSE MKT Environment and Trading Risks
Due to the environment of this exchange as described, struggling NYSE MKT pennystocks are not uncommon. Powerful marketeer basher campaigns and shorting of stocks are high. Trading can be risky for most.
Knowing the trading environment of this exchange, and the type of stocks traded on it, help the Extraordinary Investor diminish most risks as described.
NYSE MKT Pennystocks Trading vs Scam Stocks
You will not likely find many dud or scam stocks on this stock exchange, but you may find more struggling companies that would be of particular risk to invest in than the NASDAQ.
The initial stock listing requirements for NYSE MKT stocks
Companies seeking to list on NYSE MKT are initially required to meet one of the following 4 standards:
1. $750,000 pre-tax income; $3 million market value of public float; $3 minimum price; $4 million stockholders equity
2. $15 million market value of public float; $3 minimum price; 2 year operating history; $4 million stockholders equity
3. $50 million market capitalization; $15 million market value of public float; $2 minimum price; $4 million stockholders equity
4. $75 million market capitalization; or (at least $75 million in total assets and $75 million in revenues); $20 million market value of public float; $3 minimum price
Those are the minimum initial listing requirements for the micro-cap and small-cap stocks as expressed by NYSE. But remember, once the stock is trading on this exchange, one or more of those requirements are commonly suspended for many months to give quality, but struggling, companies an opportunity to comply.
How to use this information for NYSE MKT pennystocks trading to Limit Risks and increase Successful Trading:
Since the penny stocks on this exchange are pretty good quality due to the efforts of its review board, an investor. . .
• will find some good quality non-scam penny stocks to invest in that are struggling and thus trading at a discount before marketeers begin their stock promotion campaign.
• must constantly be aware that marketeers will also find the higher quality struggling penny stocks on this exchange to be worthy targets for dump and pump schemes
• should take the lenient and reasonable review board policies and basher campaign potential into account when considering potential stocks to trade. . .
For instance, will a good struggling stock that is not able to meet the listing requirements of this exchange actually be delisted? In a worse case scenario, yes, but; more likely the Review Board will give the company ample time to comply with the listing requirements.
The stock basher would love to scare you into thinking the company could be delisted. They will attempt to cause you to sell your shares in emotional hysteria. Most investors know that a delisting would likely cause the value of shares to lose most of their value overnight. No investor wants to be caught holding shares of stock that will be delisted.
NYSE MKT PennyStocks Trading strategies
Since you are investing in and trading penny stocks listed with the NYSE MKT, the stock is most likely of better quality - but do your research! If the company is any good at all, then it will not be delisted without a fighting chance.
Most importantly watch the quarterly SEC financial reports.
• When is the next SEC quarterly report due?
• What are the reasonable results of the company's financial condition and its ability to pay their debts and loans, or its ability to obtain continued financing on good terms?
• Can you predict with accuracy if the company may default on its financing agreement(s)? If so,how will that likely affect the share price? I think, not good, in most circumstances.
• Will the stock bashing campaign of your target stock likely result in that stock unraveling? If the financing is poor, little stock history, financing options are poor, and product under development is shaky when compared to competition, etc, then the stock will likely not recover from a basher compaign.
You must determine how solid or shaky a company is by studying its fundamentals just as this site is revealing to you.
Consider carefully the above questions before investing in any company just before a quarterly or annual SEC report is published. The bargain share price is not a bargain at all if the company is financially distressed - taking into consideration all fundamentals.
These types of questions are what Extraordinary Investors consider.
NYSE MKT PennyStocks Trading requires solid and ongoing fundamental research
If you see a struggling penny stock on this exchange plunge in value, research the reasons. Do a good fundamental research including its financial records and reports. Find out if the company is now trading at a bargain over a period of a few months to several years.
The stock may have plunged in value due to a marketeer basher scheme - check the news headlines and message boards for scare tactics. If all this is true, and the fundamentals are solid, then you have a super opportunity to pick up shares and ride the trend up in due time with the marketeers.
This is how the Extraordinary Investor calculates his trades. These extraordinary investment strategies are being revealed to you on this site.
My personal experience with NYSE MKT pennystocks trading:
I have found the NYSE MKT PennyStocks to be of high quality in general compared to the OTC BB. Even so, I have not as yet given myself the opportunity to invest in but a few penny stocks on this exchange.
I lost pretty big trading a penny stock on this exchange
I made two mistakes that led to this loss as follows:
My first mistake was investing in the stock based on a very good friend's persistent advice and recommendation of the stock.
Secondly, I underestimated the power of the basher campaign's affect on the NYSE MKT Review Board. . . The Review Board finally delisted the stock.
I learned from that mistakes, and life goes on.
Most of my trades are on the NASDAQ and OTC-BB.
You have completed this lesson on the:
NYSE MKT PennyStocks Trading
When you are ready, please continue on with the next sub-topic: NASDAQ financial market is fertile ground for high potential tech related penny stock trades.