Beginner’s Guide to Unlisted StocksMay 31, 2021
Unlisted stocks, by definition, are stocks or securities that are not traded formally on an exchange like the National Stock Exchange (NSE) or the Bombay Stock Exchange (BSE) in India. The reason, you ask? Simply put, these stocks do not fulfill the set criteria or minimum standards put in place by the Stock Exchange.
So, the next question that begs to be answered is, “what are these criteria that unlisted stocks fail to fulfill?” Unlisted companies typically do not meet the required company size and market share which stand for their financial viability. So, they fail to get featured on the prestigious list of Stock Exchange companies.
Unlisted stocks are sold by unlisted companies that are obviously not listed in Stock Exchanges as mentioned. These companies are privately owned and are usually funded by private investors. One of the major shortcomings of stocks from the unlisted stock exchange is the fact that the valuation of the company is uncertain because there is no stock price available to determine its market price.
This is when platforms like Unlisted Assets come to the rescue. Unlisted Assets have work in collaboration with expert transaction advisors to ensure traders get the best and the most accurate valuation on these stocks. So, if you are planning to invest in unlisted stocks make sure you choose the right platform to ensure optimum safety and security.
Since unlisted stocks cannot be traded on the National Stock Exchange platform, you must be wondering then how unlisted shares buy and sell are performed? This is where the Over-the-Counter or Off-Exchange marketplace comes into the equation. The Over-the-Counter marketplace is a decentralized network where buyers and traders can trade unlisted stocks directly with each other; without the interference of the exchange. These transactions are also free from exchange fees that can often turn out to be quite hefty for heavy investors.
The Pros of Over-the-Counter Market
- OTC market gives smaller companies, start-ups, and unicorns a fair chance to sell their shares. These shares show their true value potential when the companies go for IPO.
- The OTC market turns out to be less expensive to trade for companies and buyers alike. New issues cost less, servicing investors is less expensive and there is no exchange cost involved which makes the trade very profitable.
- The OTC market is highly transparent and offers high liquidity in shares.
- Since there is close contact between buyers and trades, valuable news and information reaches the buyers directly from the
- It ensures higher safety as OTC transactions do not take place on the spot. Instead, trades are conducted digitally through platforms just as unlisted assets which ensure that even beginner investors do not fall into the clutches of deceitful agents.
5 simple steps to buy/sell Unlisted Shares from Unlisted Assets
- Join the safe platform by signing up safely. Visit www.unlistedassets.com.
- Check out the list of shares and bid on those that look promising to you.
- You can negotiate the price of the shares you want to buy directly with the seller!
- Make your payment effortlessly through an Escrow Bank Account of a SEBI registered Trustee.
- Once your transaction is completed, you can see your shares in your Demat account.