What happens to your investment when a stock gets delisted from NASDAQ?

So what happens when you buy a stock and it gets delisted from NASDAQ like Spansion? I didn’t buy it. Do you just lose your investment? When it gets delisted it is an OTC stock right? Also lets say you bought it when it ’s an OTC and they go back up to were they were. Can they get put back into NASDAQ? What happens to your investment if that happens?
Sorry SpanKy, but that’s not what delisting means…

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Saturday, March 13th, 2010 nasdaq

4 Comments to What happens to your investment when a stock gets delisted from NASDAQ?

  1. You need to contact the company and inquire about the missing listing.

    2. SpanKy on March 13th, 2010

  2. A stock being delisted from any exchange is a bad sign. Not being listed on an exchange makes the stock less liquid. This means that while the stock may still have value it is much more difficult to find buyers for your position. It also can result in a big price decline as index based ETFs and Mutual funds sell their positions and add the replacement stock. The same thing occurs when a stock is added to and index or an exchange, if a stock is added to an index it usually experiences a short term spike in the price as it is purchased en mass by the index funds and ETFs that replicate the index, when its added to an exchange it often results in increased liquidity for the shareholders. Hope that helps!

    3. financegal27 on March 13th, 2010

  3. No, delisting, as a single event, is not equivalent to liquidation.

    Yes, it would normally trade OTC, pink sheets, unless it was taken private.

    If taken private before delisting, your broker would receive payment in exchange for your shares and you would get the cash at clearing. If after delisting, you would have to fill out the exchange paperwork yourself and mail in the share to get payment.

    If it is not taken private or liquidated (bankruptcy), it could theoretically be re-listed if things changes and it refiles for listing. however, I believe the stats on this are grim — it rarely happens.

    4. MVD34 on March 13th, 2010

  4. Its usually quoted in the Pink Sheets or the Over the Counter Bulletin Board, with a steep drop in price. Chances are usually slim they will ever get back on an exchange. And it could completely disappear.

    5. jeff410 on March 13th, 2010

Dow Jones Index

The Dow Jones Industrial Average (NYSE: DJI, also called the DJIA, Dow 30, INDP, or informally the Dow Jones or The Dow) is one of several stock market indices, created by nineteenth-century Wall Street Journal editor and Dow Jones & Company co-founder Charles Dow. It is an index that shows how certain stocks have traded. Dow compiled the index to gauge the performance of the industrial sector of the American stock market. It is the second-oldest U.S. market index, after the Dow Jones Transportation Average, which Dow also created. The average is computed from the stock prices of 30 of the largest and most widely held public companies in the United States. The "industrial" portion of the name is largely historical—many of the 30 modern components have little to do with traditional heavy industry. The average is price-weighted. To compensate for the effects of stock splits and other adjustments, it is currently a scaled average, not the actual average of the prices of its component stocks—the sum of the component prices is divided by a divisor, which changes whenever one of the component stocks has a stock split or stock dividend, to generate the value of the index. Since the divisor is currently less than one, the value of the index is higher than the sum of the component prices.
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