Types of stock markets, Finance Basics

Types of Stock Markets

1. Over the Counter or OTC and Organised Exchange market

This is whereas the selling and buying of securities is done through sellers and buyers are not present but just the agents or brokers internet.  This system is identified "open outcry".

2. Over the Counter Market or OTC

Provides a chance for unlisted or unquoted firms to sell their security. OTC is generally organized via the stock brokers or dealers who that buy securities themselves and after that sell them. They keep a reasonable balance between supply and demand and observe price movements to determine profit of income margins on sale. Trading may be done via telephones, networks, computer, fax and so on.

The dealers or participants set the treading rules OTC specialize in securities as like corporate bonds, Treasury bonds, and equity securities and so on.

Features of OTC Markets are as:

1. Prices are relatively low

2. Generally deal along with new securities of firms

3. Is collected of closely and small held firms.

Posted Date: 2/1/2013 12:06:41 AM | Location : United States

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