OTC

The Over-the-Counter (OTC) market is a decentralized marketplace where financial instruments such as stocks, bonds, and derivatives are traded directly between two parties without the involvement of an exchange. This market is popular among small companies that cannot meet the listing requirements of major exchanges like the New York Stock Exchange (NYSE) or NASDAQ. In the OTC market, trading is conducted through a network of dealers who act as intermediaries between buyers and sellers. Unlike the centralized exchanges, the OTC market has no physical location and operates 24 hours a day, five days a week.

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The OTC market is characterized by less regulation and transparency compared to the major exchanges. It is also known for its high volatility and risk due to the lack of standardization and information disclosure. However, the OTC market provides an opportunity for small companies to raise capital and for investors to access a wide range of financial instruments. It is important for investors to conduct thorough research and due diligence before investing in OTC securities to mitigate the risks associated with this market.