📈 Stocks & Equities · Lesson 4 of 9 · 14 min
NYSE, NASDAQ, OTC & Pink Sheets
🏛️ Stocks trade in different neighborhoods, and just like real estate, the address tells you a lot. Some are gleaming exchanges. Others are the financial equivalent of a deal done in a parking lot at 2am.
💡 Key idea
NYSE/NASDAQ = safer. OTC/Pink Sheets = high risk.
🧠 Why it matters
NYSE = blue chips (Coca-Cola, JPMorgan). NASDAQ = tech (Apple, Google). OTC = off-exchange, thin disclosure. The lowest OTC tier (the old 'Pink Sheets,' now 'Pink Limited') = wild west.
🌍 In the real world
⚠️ Most pump-and-dump scams happen on Pink Sheets. Always check WHERE a stock trades before buying.
📌 Takeaways
- NYSE & NASDAQ = regulated, safer
- OTC (incl. the old 'Pink Sheets' tier) = thin disclosure, minimal oversight
- Check exchange before buying
📖 Terms in this lesson
Liquidity: How quickly something can be turned into cash without losing value.
✅ Test yourself
Strictest exchange requirements?
- Pink Sheets
- OTC
- NYSE
- NYSE American
Answer: C · NYSE
NYSE (like Nasdaq's top tier) has strict listing requirements — companies must meet high financial and reporting standards.
Where do most pump-and-dump scams happen?
- NYSE
- NASDAQ
- Pink Sheets
- S&P 500
Answer: C · Pink Sheets
Pink Sheets are barely regulated, making them the favorite hunting ground for scams. Tread very carefully.
A friend pitches a 'hot' stock trading on Pink Sheets. Smart move?
- Buy immediately
- Be very skeptical and research hard
- Borrow money to buy more
- Tell everyone you know
Answer: B · Be very skeptical and research hard
Pink Sheet stocks lack regulation and transparency. Extreme caution — most 'hot tips' there are traps.
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