Consolidated Tapes
Analysts rely on numerous sources of information to find out more about the securities they follow.
  • For equities, the most immediately recognizable source is consolidated tapes - the electronic successor to the old ticker-tape machine tracking exchange-traded shares.

  • The tapes' "Network A" covers the NYSE-listed securities, and it identifies not only the per-share bid price of the latest block to trade on each stock, but also the originating market because many of these securities also trade in regional markets away from the Big Board.

  • "Network B" performs a similar function for securities listed on the Amex and for securities listed only on regional exchanges. When a transaction takes place, the tape will list the stock symbol, the number of 100-share blocks trading, the letter "s" for "shares" and the price. If 1,200 shares of Exwhyzee Corp. stock should trade at $90.25 cents on the NYSE, then Network A would report: "XYZ 12 s 90¼".
Over the Counter (OTC)
The exchanges operate on an auction basis, meaning the highest price an investor is willing to pay for a stock is that stock's price. Away from the exchanges, in what is known as the over-the-counter (OTC) market, shares trade on a negotiated basis, meaning there is a price that is requested by a party who owns shares, and that is countered by an offer of what another party is willing to spend. These are known as the bid and ask prices, respectively.
  • The most famous portion of the OTC market is the Nasdaq, the largest electronic screen-based equity securities market in the United States.
  • With approximately 3,300 companies, it lists more companies and, on average, trades more shares per day than any other U.S. market.
  • Technically, it is not an exchange, just a system for trading stocks that are not listed on the major national or regional exchanges.
  • How Does the Nasdaq Provide Information?
    • Nasdaq makes information available on a subscription basis; the amount of information a broker-dealer receives is a factor of how much it pays:
    • Level 1 provides the bid and ask prices of securities traded through the Nasdaq.
    • Level 2 includes quotations from individual market makers as well as the Level 1 data.
    • Level 3 includes the ability to enter quotations, to direct and execute orders and to send information; this service is restricted to FINRA member firms that function as registered market makers in either exchange-listed or OTC securities.
  • Nasdaq Listing Requirements
    • The Nasdaq has certain listing requirements related to shareholders' equity, market capitalization and per-share price.
    • Not all publicly traded shares meet these thresholds, and not all the companies whose shares do meet the criteria for Nasdaq listing choose to participate.
    • This is where you enter the realm of the true OTC market, sometimes called the "penny stock" market because of the ubiquitous low share prices - typically under $5, sometimes under $1.
  • The OTC Bulletin Board
    • Similar to Nasdaq Level 1, the OTC Bulletin Board is a regulated quotation service displaying real-time quotes, last-sale prices and volume information for OTC securities not listed on Nasdaq.
    • The OTC Bulletin Board lists not only stocks, but also warrants, ADRs and DPPs.
    • These securities are traded by a community of market makers linked through a closed computer network.
The Nasdaq, the related Nasdaq Small-Cap Market and the OTC Bulletin Board are collectively known as the interdealer quotation systems.

Pink Sheets
A private firm called Pink Sheets is the leading provider of pricing and financial information for the OTC securities markets. Pink Sheets is a source of competitive market maker quotations, historical prices and corporate information about OTC issues and issuers.

The origins of the Pink Sheets go back to 1904, when the National Quotation Bureau began as a paper-based, inter-dealer quotation service linking competing market makers in OTC securities across the country. Since that time, the Pink Sheets have been the central resource for trading information in OTC stocks. In 1999, Pink Sheets introduced an Internet-based, real-time quotation service for OTC securities for market makers and brokers, expanding it to a publicly accessible web portal in 2000.

Yellow Sheets
The Yellow Sheets is a publication once related to the Pink Sheets, and is now a daily bulletin from the National Quotation Bureau providing bid and ask prices for OTC corporate bonds. The Yellow Sheets also lists broker-dealers that act as market makers in those bonds.

Blue List
Continuing with the multihued theme, municipal and corporate bond information comes courtesy of the Blue List. Published by Standard & Poor's, the Blue List is a daily digest of municipal and corporate bond offerings, market commentaries, fixed-income statistics and other items of interest to bond investors., its online ticker service, updates dealer offerings from 8:00 a.m. until 5:00 p.m. Eastern time.

Bond Buyer
The less colorfully named Bond Buyer is a daily newspaper serving the municipal bond market and providing news, data, statistics and analysis. Unlike the Blue List, it is focused entirely on munis. Its new issue worksheets summarize recent underwritings, showing the percentage of new issues sold.

For the purposes of your Series 7 exam, there are three indexes found in the Bond Buyer that you should familiarize yourself with:
  • REVDEX - This 25-bond index contains bonds froam a variety of industries (with a variety of ratings) and estimates the yield on 30-year revenue bonds. (Hence "REV")
  • GO Index - This index is comprised of 20 bonds rated "A", and estimates the yield for 20-year GO bonds. (Remember that "GO" stands for General Obligation bonds)
  • Bond Buyer Municipal Bond Index (40-Bond Index) - This daily, 40-bond index, contains recently issued munis with an average maturity of 20-years. It calculates the average price of 40 issues from 6 brokers' broker quotations, and adjusts the price to a 6% yield basis.
Also, within this publication you would find the 30-day visible supply.

Other Sources of Bond Information
Other sources of bond information include Munifacts, the municipal bond newswire service which provides information on both new issues and secondary markets, and Moody's Bond Survey, which tracks trends for the fixed-income market and offers specific recommendations on individual issues. Public newspapers are also frequently cited in analysts' reports. The Wall Street Journal in particular is a popular source, but other financial publications and even the hometown papers of the municipalities under scrutiny are also used.

Financial Press
The financial press is also a key source of data about listed options, as is the Options Price Reporting Authority (OPRA), which provides last-sale information and current options quotations from designated participating exchanges.

Sources of Investment Research Information
Keep in mind that you will probably be applying for a job as a sales representative for your broker-dealer, not as an analyst. Much of the information from the above sources is likely to be overwhelming in its complexity. You will need focused, summary information.
The Business Cycle

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