OTC market is the abbreviation of Over-the-counter, that is, OTC market, which is a concept relative to the trading market. Mainly refers to the two sides of the transaction privately negotiate the transaction content, and then conduct one-on-one transactions. There is no fixed place, no prescribed membership quota, no controllable supervision system and no restrictions on trading products for OTC trading. This form of transaction is very common in the financial industry in developed countries.
OTC market is the oldest trading place in the securities world. It stems from the fact that banks initially engaged in stock trading business: it is called OTC market because it sells stocks to customers on the bank counter, and it is also called OTC market because this kind of trading is not carried out on the exchange. Securities that cannot be listed on the stock exchange include stocks that do not meet the listing standards of the stock exchange, stocks and bonds that meet the listing standards of the stock exchange but are unwilling to be listed on the stock exchange.
What do you mean by OTC market? I believe everyone already knows, which countries have OTC market now? Let's take a look at the content.
At present, the most influential OTC markets in the world are Nasdaq, OTC Securities Quotation Announcement (OTCBB) and Pink Sheet. British alternative investment market; French shopping center (CMF) and Paris new market; Korean shopping malls, etc. There is a huge OTC market in the United States, and the number of securities traded in these markets accounts for about three-quarters of the total securities trading volume in the United States.
As an important part of the capital market system, OTC market can not only raise a lot of money for the economic development of the host country, but also provide an exit channel for venture capital, which not only promotes the development of venture capital, but also promotes the development of high technology and the upgrading of industrial structure. In addition, the development of OTC market has improved the exit mechanism of listed companies and promoted the healthy development of the securities market. The specific characteristics of the OTC market are as follows:
[1] OTC market transactions are scattered, and OTC market activities are carried out by several independent securities companies, not by one or several same institutions.
[2] OTC trading is direct: the issuer of securities sells securities directly to investors without the intermediary of securities brokers.
[3] The trading agreement in the OTC market is quite free: OTC is the offline transfer of securities, which is carried out in the process of negotiation and bargaining between securities companies and investors.
Over-the-counter market refers to the securities that cannot be listed on the stock exchange, including stocks that do not meet the listing standards of the stock exchange, stocks and bonds that meet the listing standards of the stock exchange but are unwilling to be listed on the stock exchange.
However, it should be noted that OTC transactions face many risks, including credit risk, market risk, liquidity risk, legal risk and operational risk. Therefore, controlling operational risk should be an important aspect of controlling OTC risk and should be paid enough attention. The stock automatic trading system is also the content to be learned in the stock market.
OTC market also exists in China, including strengthening the construction of financial market system and optimizing the social financing structure of financial service industry; Promote policy banks, large commercial banks, joint-stock commercial banks, small and medium-sized banks, financial institutions and asset management companies to implement differentiated development strategies; Give play to the asset allocation and financing service functions of credit financing, securities, insurance, trust, wealth management, guarantee and other businesses; Vigorously develop the capital market, improve the multi-level capital market system, and promote the establishment of a national OTC market; Accelerate the development of the bond market and improve the variety system of commodity futures and financial futures.