The SEC Office of Investor Education and Advocacy issued an Investor Bulletin on "microcap stock basics." The Investor Bulletin provided a brief overview of how to adequately research microcap companies which are often known as penny stocks. The Investor Bulletin recommended that investors should access current research information from:
- the microcap company directly (particularly though its website), noting its management;
- the SEC through its EDGAR database;
- their own state's securities regulator (or the regulator for the state where the company is located);
- other government regulators, such as the Federal Reserve System, the Office of the Comptroller of the Currency or the FDIC;
- reference books, websites and commercial databases; and
- the Secretary of State where the company is incorporated to determine whether the company is in good standing.
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