November 30, 2016 - By Louis Casey
Upon recent trading, SPECIAL DIVERSIFIED (OTCMKTS:SDOI) shares caught focus of OTC traders as the price moved $-0.05, touching the $1 price point. Analyzing past data, SPECIAL DIVERSIFIED’s shares price was big mover in the last 1-year with the 52-Week low of 20.48% and 52-Week high of -15.25%.
Measuring a firm’s market value, also known as market capitalization allows investors and financial analysts assess the size of a firm relative to the market. Market capitalization can be understood as a statistic reflecting the public’s confidence in a firm because the calculation highlights the public’s investing arrangements. Financial institutions can put similarly-sized firms into groups such as mid-cap, small-cap AND large-cap by establishing a firm’s market capitalization.
Market capitalization is a vital financial indicator for two main reasons. Firstly, it helps investors in establishing value comparison between firms with their stocks trading at different levels. Secondly, it helps decide a firm’s size in relation to its peers. A firm’s market cap varies as its shares price changes, so financial editors compute market capitalization for public firms daily. SPECIAL DIVERSIFIED (SDOI)’s market capitalization is currently $20.44 million.
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SPECIAL DIVERSIFIED’s shares has traded at $-63.33 month over month. The short interest of stock currently stands at 1,100 against short interest of 3,000 last month. Investors have 0.1 days to close the position.
The over-the-counter market is a place where stocks that are not listed on the NASDAQ, NYSE, or AMEX are traded. This term is referred exclusively for marginal or small firms that don’t fulfil the listing guidelines of the regulated stock exchanges. These stocks are sometimes called ‘pink sheet’ stocks, a term coined from the old days when such stocks lists were published on pink paper (now exclusively online). Since these equities are small and frequently financially suspect, OTC stocks are stated to be risky and, thus, are poorly traded. They are rarely traded, which indicate that the prospect of getting a bargain price is better over the stocks listed in an organized market. As a result, some traders are inclined to purchase OTC stocks in anticipation of making fast gains. The possibility of fast money becomes easier following the cheap prices of most of the OTC shares, often under $2.00-$1.00 per share, though it’s made tougher by the fact that detailed information on these equities is scarce and often undependable.
Trading in OTC securities is no different from straight gambling, and it is not suggested for beginners. Over-the-counter market is a decentralized market, with no central physical location. Market participants use communication methods like the telephone, email and proprietary electronic trading systems for trading. The exchange market and over-the-counter (OTC) market are two simple ways to establish a financial market.
Within an OTC marketplace, dealers are termed ‘market makers’ when they quote equity prices where they will sell and buy a currency or security. Trades can be carried out between two members in an OTC market without others being made informed of the transaction price, making OTC markets less reliable than exchanges. They are subject to fewer guidelines, which means increasing problems for investors. OTC markets are used mainly to trade currencies, structured products, derivatives and bonds. OTC markets can be used to trade stocks, such as the OTCQB, OTC Pink and OTCQX marketplaces in the U.S. Dealers that function in the U.S. markets are controlled by the Financial Industry Regulatory Authority, popularly named FINRA.
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OTC marketplace is a platform where clients and dealers trade with each other just like institutions and corporations do. The price a buyer gets from a seller may vary from the price received for same equity from another seller. The ask-bid margin is often wider for the OTC stocks. OTC markets operate smooth during the normal times, however, their lack of transparency becomes a vicious factor that can result in financial stress, and it was the same case when the 2007-2008 worldwide credit crisis happened. Mortgage-backed equities such as CMOs and CDOs, which were traded solely in the OTC markets, could not be dependably priced as liquidity was poor, and buyers were reluctant to trade in this market. This resulted in an increased count of dealers backing out from market-making activities, increasing the liquidity issue while driving a global credit crunch. The regulatory measures created in as the outcome of the crisis resolved this problem with the setup of clearinghouses for post-trade activities.
Disclaimer: The advice provided on this website is general advice only. It has been prepared without taking into account your objectives, financial situation or needs. Before acting on this advice you should consider the appropriateness of the advice, having regard to your own objectives, financial situation and needs. Where quoted, past performance is not indicative of future performance.
More important recent Special Diversified Opportunities Inc (OTCMKTS:SDOI) news were published by: Seekingalpha.com which released: “Special Diversified Opportunities: A Shell Company Trading Below Net Cash” on October 06, 2016, also Seekingalpha.com published article titled: “Special Diversified Opportunities: Buying Upside For Free”, Seekingalpha.com published: “Special Diversified Opportunities: The Ultimate Deep Value Play With A …” on November 05, 2014. More interesting news about Special Diversified Opportunities Inc (OTCMKTS:SDOI) was released by: Streetinsider.com and their article: “Form SC 13D/A Turning Point Brands, Filed by: Standard General LP” with publication date: November 25, 2016.
Special Diversified Opportunities Inc. is a shell company. The company has a market cap of $20.44 million. The Company’s board of directors has been exploring strategic alternatives to maximize shareholder value going forward, including deploying the proceeds of the Asset Sale in business acquisition opportunities, merging with another company, or other actions to redeploy the Company’s capital, including, without limitation, distribution of cash to its shareholders. It currently has negative earnings. Prior to the completion of the Asset Sale, the Company was a biotechnology company, which was engaged in developing, commercializing and marketing products, services and solutions that preserve and enhance the human health and wellness.
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By Louis Casey