The waters of Over-The-Counter or OTC trading seem quite murky for the most part. Maybe because not that many people genuinely understand what OTC trading is all about, perhaps it’s because Over-The-Counter trading has a bit of a shady reputation… or, well, both.
This video explains what OTC trading is as well as what broker-dealers do in just one minute. You’ll find out how OTC Link and OTCBB work, with the entire process being quite logical if you take things one step at a time.
In the spirit of doing just that, I’ve started by explaining Over-The-Counter trading as a concept, with us then moving on and looking at the main actors, specifically the (in)famous broker-dealers.
You will find out what the pros associated with OTC trading are, what cons you need to be aware of and whether or not this is an option that might make sense for you at one point or another.
Do keep in mind that even Walmart started out in the Over-The-Counter space, so it would perhaps be wise to acknowledge that we’re simply dealing with a tool which is neither inherently good nor inherently bad, it’s all a matter of how you use it :)