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Over-the-Counter Market

   Also found in: Dictionary/thesaurus, Medical, Acronyms, Encyclopedia, Wikipedia 0.01 sec.
Over-the-Counter Market
Describing a security or trade that does not occur on an exchange. Very often, the OTC market includes securities that are very small and do not trade on an exchange because they do not meet market capitalization requirements. OTC securities may theoretically be traded informally (one may stand on a street corner and sell his/her stocks), but the term usually refers to securities traded through a dealer network.

over-the-counter market (OTC)
A widespread aggregation of dealers who make markets in many different securities. Unlike an exchange on which trading takes place at one physical location, OTC trading occurs through telephone or computer negotiations between buyers and sellers. Although stocks traded over the counter are often more speculative than listed stocks, virtually all government and municipal bonds and most corporate bonds are traded in the OTC market. See also National Quotation Bureau, OTC Bulletin Board, third market.


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And it will let exchanges such as the Chicago Merc handle agricultural "swaps," contracts that now trade privately in the over-the-counter market.
Waco, Texas-based Life Partners Holdings, which had traded on the over-the-counter market since 2000, began trading on the Nasdaq Oct.
The Japan Securities Dealers Association, which is in charge of the Jasdaq over-the-counter market, said its 290 member brokerages, including 50 foreign ones, posted pretax profits totaling 24 billion yen during the period.
 
 
 
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