Stocks-OTC.Com
| NYSE, TSX, AMEX, NASDAQ FOREX |
A security traded in some other way rather than on a formal security exchange such as the NYSE, TSX, AMEX, etc. The phrase "over-the-counter" (often called PENNY STOCKS ) can be used to refer to stocks that trade via a dealer network instead of on a centralized exchange. It also includes debt securities and various other financial instruments such as derivatives, that are traded through a dealer network.
Often, the reason for
which a stock is traded over-the-counter
is because the company is small, making it
unable to meet the security exchange listing
requirements. Also called "unlisted stock",
these securities are sold by broker-dealers who negotiate
with one another over computer networks, fax and by
telephone. Bonds, because they do not trade on a formal exchange and are considered OTC securities. Most debt instruments are traded by investment banks making markets for specific issues. If an investor wants to buy or sell a bond, they must call the bank that makes the market in that bond and ask for a quote. The Foreign Exchange Market – known as FOREX - is a world wide market for buying and selling national currencies. It handles a huge volume of transactions 24 hours a day, 5 days a week. Daily exchanges are approximately $1.5 trillion (US dollars). In comparison, the United States Treasury Bond market averages $300 billion a day and American stock markets exchange about $100 billion a day.
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