12th Nov 2009 by Amelia Timbers
OTC means "Over the Counter". Over the Counter equity is not open to the public. They are trades of derivatives, private equity, and unusual investment instruments. OTC securities are traded in the OTC Bulletin Board or Pink Sheets. These assets are not usual for typical investors and are typically employed by large institutional investors. These markets are only accessible by properly licensed finance professionals. OTC securities are also where "market makers" trade. For example, in OTC markets UBS trades with ETrade, etc. OTC markets are what many hedge funds deal in. These assets are not like stocks that just anyone can purchase; there are generally captial and organizational standards to be met for market access.
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