I have already created a ticket and written to IB about this issues several times in the last weeks but received no reply
I want to invest in this Swedish company Evolution AB, when I search it under IBKR, I have found that It’s listed at least in Nasdaq Stockholm, US ADR Pink(not sure what this is) and FWB2
US ADR Pink is in USD, it says I don’t have trdaing permission, and I don’t see where I can get it under Client Portal, there is a place where I can request permission for futures, options etc but this is just a normal stock, and I seem to have permission for all European stocks
Then for Nasdaq Stockholm, I have strictly 0 market data, not even delayed data, which is weird, as with other EU stock exchanges i generally have delayed data with IBKR, and for this Sweidish stock I can even have delayed data with Google but not with IB?
ADRs are American Depositary Receipts. In this case a depositary bank in America holds the shares and you will hold the shares indirectly through this depositary bank. Each ADR is then a certain amount of the underlying shares, e.g. 1 ADR could be 10 shares of company X. This is used to make it easier for US investors to invest in foreign markets.
Pink is an old term used for securities that are traded OTC and not on any exchange.
So I guess you won’t get access to these through IBKR, no matter which trading permissions you have.
I always buy my swedish companies (I have 3 now) at the regular place of exchange (Nasdaq Stockholm). Yes, you can’t have the data for any swedish companies at IB for a mysterious reason, but you can buy there without problem.
Thanks, I knew what ADR was but not Pink, do you mean as an individual, even I have IBKR Pro(+100k USD), I am not allowed to trade OTC?
Thanks a lot!
is it normal the commission to convert USD to SEK is very expensive on IB? to convert other major currencies I generally get charged 2-3 CHF each time, but it costs me 22 CHF/USD as commission to convert 27k USD to SEK?!
I don’t get why we don’t even see the free data we can see with Google, also without being able to see the trading volumne etc is a bit anooying.
Ideally I prefer to buy the stock in USD, as I don’t have any connection to Sweden and own no other Swedish stocks, don’t know if owning SEK and stocks in SEK’s currency risk is too high
It has not to do with permissions, you could have all permissions and still couldn’t get it. It’s not that you are not allowed to trade OTC, but IBKR is apparently not a dealer that trades this product. OTC is not a category of securities, OTC is for products that are not traded on an official stock exchange, but rather through a network of dealers.
In this context, OTC/Penny Stocks/Pink Sheets means the same thing.
From IBKR itself:
What is a “Penny” Stock?
Generally, penny stocks are low-priced shares of small companies that are not traded on an exchange or quoted on NASDAQ. Penny stocks generally are traded over-the-counter, such as on the OTC Bulletin Board or Pink Sheets, and are historically more volatile and less liquid than other equities. For these and other reasons, penny stocks are considered speculative investments and customers who trade in penny stocks should be prepared for the possibility that they may lose their entire investment, or an amount in excess of their investment if they purchased penny stocks on margin. Before investing in a penny stock, you should thoroughly review the company issuing the penny stock. In addition, you should be aware of certain specific risks associated with trading in penny stocks.
Just add “Penny Stocks” to permissions and it will work. I’ve traded Pink Sheets/OTC with IBKR before.
Penny stocks are stocks with a low price, but some of them are traded on stock exchanges. Penny stocks can be pink sheets, but a pink sheet is by definition not traded on a stock exchange, so not every penny stock is a pink shert.
You are referring to the colloquial meaning. However, in the context of trading permission and trading, ‘Penny Stocks’ have a specific meaning (hence the separate category of permssions). See also Wikipedia for more details/background:
Penny stocks are common shares of small public companies that trade for less than one dollar per share. The U.S. Securities and Exchange Commission (SEC) uses the term “Penny stock” to refer to a security, a financial instrument which represents a given financial value, issued by small public companies that trade at less than $5 per share. Penny stocks are priced over-the-counter, rather than on the trading floor. The term “penny stock” refers to shares that, prior to the SEC’s classification, traded for “pennies on the dollar”. In 1934, when the United States government passed the Securities Exchange Act to regulate any and all transactions of securities between parties which are “not the original issuer”, the SEC at the time disclosed that equity securities which trade for less than $5 per share could not be listed on any national stock exchange or index.
As you can see, by regulation, Penny Stocks are not listed on any stock exchange or index.