OTC Stock Shell Risk Scoring: How to Screen Penny Stocks Programmatically

OTC Stock Shell Risk Scoring: How to Screen Penny Stocks Programmatically

When building retail trading tools or fintech apps that need to screen penny stocks and other over-the-counter (OTC) companies, one of the most significant challenges is identifying shell companies. These are entities with no real business operations but often have inflated stock prices due to speculative buying and selling.

Identifying Shell Companies: A Python Example

Here's a simple example using Python to identify OTC companies that may be shell companies:

python
import requests

# API endpoint for screening OTC companies
url = "https://api.verilexdata.com/api/v1/otc/sample"

def screen_otc_companies():
    response = requests.get(url)

    if response.status_code == 200:
        otc_data = response.json()

        # Assuming we are interested in a specific attribute like 'company_name' and 'status'
        filtered_data = [
            {"name": company["company_name"], "status": company["status"]}
            for company in otc_data
            if company["status"] == "shell"
        ]

        return filtered_data
    else:
        print(f"Failed to retrieve data: {response.status_code}")
        return []

# Call the function and display results
screened_companies = screen_otc_companies()
for company in