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Author: DrBear One star, 50 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 76398  
Subject: Re: stocks not on exchanges Date: 4/7/1998 11:27 AM
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<<I think that my first reaction was the same as JeanDavid: there must be a better way to "burn down" the balance than to buy an unlisted stock.

Then, I had some second thoughts-maybe this is a local company (bank, manufacturing, retail, etc.) that the person has some knowledge of, but is not traded on an exchange. I would not necessarily criticize someone for owning such a company.>>

One of my former employers is a privately held bank, and I would kill (figuratively, not literally) to get my hands on some of it's stock. Fortunately, I was able to receive some benefit indirectly while I was there through the appreciation of the stock in the profit-sharing plan.

On this point I would concur: If you know the business inside and out and still want to invest, it's not necessarily throwing your money away. However...

<<Talk about a timely issue...I opened the current issue of Kiplinger's (May, pg.56) and found some interesting information. It appears that some very good companies are not listed, including Kohler (plumbing supplies), Nestle, Nintendo, and Adrian Steel. The explanation was that some companies either didn't care to file the SEC documents and pay the listing fees or they just don't care to have an active market for their shares.>>

Dr Bear would like to point out that you need to consider other criteria when investing in non-publicly traded stocks. You become a minority owner of the business, subject to the whims of the majority owner(s), including, but not limited to:
- what price you buy at
- what price you sell at
- who you sell to
- when and if you can buy/sell the stock.
There are many great companies which aren't actively traded, but that doesn't mean you should own the stock. Liquidity and fair pricing should be primary considerations in any purchase decision.
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