Rules on penny stocks
SEC Definition on Penny Stocks: Although the definition provided by the Securities and Exchange Commission is open with respect to the trading of penny stocks, these are generally not traded in NYSE or NASDAQ. There is a rare chance that these will be traded at any foreign exchange, however the Securities and Exchange Commission has put the higher ceiling of $5.0 for these speculative stocks.
US Securities and Exchange Commission: The mission and aim of the US Securities and Exchange Commission is to protect the investors from fraud, scam or other type of misappropriation. The commission is also ensure that the markets are efficient and fair. The commission also facilitates capital formation. The commission encourages more and more investors to get benefit from the share markets. It is one of the pillars for improving the economy of United States that will result more healthy opportunities for employment and better health and living standards for common people of United States.
The role of the commission is not limited to ensure proper protection of investors but it is also responsible for framing various rules and guidelines for smooth functioning of stock exchanges. It also lay guidelines for companies desirous to collect money from the market and strictly monitor the financial and other activities of such companies. It also ensures that the companies are taking care of their investors according to the rules and guidelines.
SEC Rules on Penny Stocks: As per the rules laid down by SEC, a broker or dealer is required to approve the customer desirous to sell the penny stock before the transaction. The broker should also get a written request from such customer.
SEC rules that a customer desirous to purchase a penny stock should be provided a document mentioning the risk involved in the penny stock. The broker or dealer should also inform the customer the current market rate of the penny stock and the commission that will be charged by the broker.
SEC further rules that a monthly statement of the account showing the current market rates of each penny stock held by the customer in his or her account should be send to the customer.
Summary: Penny stocks are governed by certain rules and regulation as lay down by SEC (Securities and Exchange Commission of US). The brokers and dealers should mandatory follow the instructions otherwise they are liable for punishment. The SEC rules provide protection of investors from fraud or misappropriation and dealers should also inform the investor about the current market rate and dealers commission before selling the stock.
Comments
Menu
My Articles
Penny Stocks: Are They Right For You?Learning The Basics Of Penny Stocks
Investing In Penny Stocks
Penny Stocks: Are Penny Stocks Dangerous?
Trading Of Penny Stocks
Penny Stocks Market
Penny Stocks: What Are Penny Stocks?
Penny Stock Picks
Penny Stocks: From Little Pennies To Big Dollars?
Penny Stocks: Learning More About Penny Stocks
How You Can Make (or Lose) Money On Penny Stocks
Fraudulent Activities In Penny Stocks
Penny Stocks And Investments
Risks In Penny Stock Investments
Penny Stocks: Are Penny Stocks Too Risky?
Penny Stock Returns
Penny Stocks: Aren’t All Penny Stocks A Scam?
Penny Stocks: How Do You Trade In Penny Stocks?
Penny Stocks Getting Started
What Are Penny Stocks?
Penny Stocks Risks
Penny Stocks: Is It A Good Idea To Invest?
Penny Stocks: Are Penny Stocks Legal?
Rules On Penny Stocks
My Articles Penny Stocks: Are They Right For You? Many people know that the stock market is a good way to invest, and.. Penny Stocks: Learning More About Penny Stocks There’s so much information out there on different stocks, and advice on.. Trading Of Penny Stocks Introduction to penny stocks: The trading of the regular stocks.. Learning The Basics Of Penny Stocks Penny stocks are stocks that are either low in value or low in the.. |
|
|
Related News:
|