Because many OTC stocks trade for less than $5.00 per share, E*TRADE classifies them as penny stocks. You must read and acknowledge a risk disclosure in your account settings to unlock permission to trade them. 2. Fund Your Account and Wait for Settlement
📌 Understanding OTC Stocks
Low liquidity means small trades can cause massive swings in a stock's price. buying otc stocks on etrade
Many OTC companies are not required to file financial reports with the SEC, making them targets for fraud and "pump-and-dump" schemes. Because many OTC stocks trade for less than $5
Over-the-counter (OTC) stocks are securities that are not listed on major centralized exchanges like the New York Stock Exchange (NYSE) or the Nasdaq. buying otc stocks on etrade