For small companies, pink sheets create an opportunity to get access and raise capital by selling their shares to the public. Because of the lack of a stock historical backing or a reliable financial track record, these small companies are often forced to sell their stock at considerably low prices.
The low share prices make it possible for more investors to afford the company’s shares. Additionally, pink sheet transaction costs are low since the listing fees of the large exchanges are not charged.
Pink sheets generally come with both advantages and disadvantages (the pros and cons respectively).
Some of the disadvantages or cons of Pink sheet listing and trading include: