Bob Brinker's Marketimer

  Tuesday November 21, 2017

Next Marketimer © Mailing Date: November 6th


© 1997-2017
Privacy Policy

Hosted by:
@ ADPAD INC.




WHAT KINDS OF SECURITIES ARE TRADED ON THE OVER-THE-COUNTER MARKET?
Learn even more about this topic with the Encyclopedia of Personal Finance™

Securities traded over the counter are primarily stocks and bonds. Virtually all government and municipal bonds are traded on the OTC market. In addition, corporate stocks and bonds are traded here as well.

Any company can sell its securities on the OTC market. This is another distinction between OTC trading and the trading on stock exchanges, where companies must apply to be listed and where the exchange board regulates which companies may be traded.

Because they are not listed with an exchange, companies traded exclusively over the counter are often called unlisted companies.

Companies whose stocks are traded over the counter often do not meet the listing requirements of the stock exchanges, which typically require companies to meet minimum levels of annual net income along with a minimum number and value of outstanding shares. As a result, OTC companies tend to be smaller and newer than companies listed on exchanges. And, you are not likely to find blue chip stocks -- the highly reliable stocks of older, established powerhouses like General Motors or IBM -- on the over-the-counter market.

Some larger companies do prefer to be traded OTC, and it is possible to find exchange-listed stocks traded over the counter (referred to as third market trading.)

Even though it occurs outside an exchange, OTC trading is still subject to regulation. We will learn about who regulates it and how next.




LEARN EVEN MORE WITH THE ENCYCLOPEDIA OF PERSONAL FINANCE. CLICK HERE!

Powered by


Copyright ©1999-2017, Precision Information, LLC. All Rights Reserved