Articles Posted in Investment Terms and Concepts

How Are Microcap Stocks Different From Other Stocks? Lack of public information. Often, the biggest difference between a microcap stock and other stocks is the amount of reliable publicly-available information about the company. Most large public companies file reports with the SEC that any investor can get for free from the SEC’s website. Professional stock…

FAQ – Where Do Microcap Stocks Trade? Many microcap stocks trade in the “over-the-counter” (OTC) market. Quotes for microcap stocks may be available directly from a broker-dealer or on OTC systems such as the OTC Bulletin Board (OTCBB), OTC Link LLC (OTC Link), or Global OTC. OTC Bulletin Board is an electronic inter-dealer quotation system…

What Is a Microcap Stock? The term “microcap stock” (sometimes referred to as “penny stock”) applies to companies with low or micro market capitalizations. Companies with a market capitalization of less than $250 or $300 million are often called “microcap stocks” – although many have market capitalizations of far less than those amounts. The smallest…

What is a Boiler Room Scheme? Boiler room schemes are large-scale operations designed to lure in as many investors to an investment scam as possible, often using high-pressure sales tactics. Boiler room scheme operators may cold call investors or solicit investors through emails, text messages, social media, and other means. Beware of boiler room scheme…

Do anti-fraud provisions apply? All securities transactions, even exempt transactions, are subject to the antifraud provisions of the federal securities laws. This means that you and your company will be responsible for false or misleading statements that you or others on your behalf make regarding your company, the securities offered, or the offering. You and…

Exchange Traded Notes (ETNs) Frequent Asked Questions – Boca Raton, Florida FINRA Arbitration and State and Federal Court Litigation Attorney: Frequently asked questions about Exchange Traded Notes (ETNs). ETNs are unsecured debt obligations of financial institutions that trade on a securities exchange. ETN payment terms are linked to the performance of a reference index or…

Bank Claims – Breach of Fiduciary Duty and Breach of Contract Federal and State South Florida Commercial Litigation Attorney Bank Claims – Breach of Fiduciary Duty: Does a bank owe you a duty of care, which would support a claim for negligence? “To maintain an action for negligence, a plaintiff must establish that the defendant…

FAQs Margin – Boca Raton, Florida Margin Abuse and Breach of Fiduciary Duty FINRA Arbitration and Litigation Attorney Margin: Borrowing Money To Pay for Stocks: “Margin” is borrowing money from your broker to buy a stock and using your investment as collateral. Investors generally use margin to increase their purchasing power so that they can…

T + 3 – Settlement of Security Transactions – Boca Raton, Lake Worth and North Palm Beach, Florida Securities Litigation and Arbitration Attorney What is meant by T+3? Generally, investors must complete or settle their security transactions within three business days. This settlement cycle is known as “T+3,” shorthand for “trade date plus three days.”…

FAQs Regulation SHO – Boca Raton and Delray Beach, Florida Securities Litigation and Arbitration Attorney Regulation SHO Compliance with Regulation SHO began on January 3, 2005. Regulation SHO was adopted to update short sale regulation in light of numerous market developments since short sale regulation was first adopted in 1938 and to address concerns regarding…