Over Counter

Over Counter
It is the market which is directly conducted between the principals and dealers through telephone and a network rather than the regulated trading floor exchange. Stocks of the small companies, securities and bonds which are not traded on a formal argument can be dealt on the counter. In such type of markets, the dealers who are also called as the market makers purchase and sell the securities from self-inventories. So, if the investor wanted to purchase or sell a particular security, he would consult with a dealer of a specific security and demand for perfect ask or bid price. Forex trading is also done in the over the counter market because exchanges are not executedfrom the centralized exchange.