The 101,000 Exchange is not the only place where you can make a trade. It is possible for two investors to trade directly with each other on individual terms. The place of such transactions is called the over-the-counter market.

In this article we offer you to disassemble the over-the-counter market in detail and understand how different it is from the stock market.

It is worth noting that the over-the-counter market is typical of more experienced market participants who are able to create and offer each other favorable trading conditions that are not on the classic stock exchange. To do this, you need a brokerage account.

What is the over-the-counter market

OVER-the-counter are called decentralised markets where transactions can be made, excluding the participation of intermediaries. They are made directly between investors (counter-agents) thanks to phone, email and one of the world’s recognized specialized software. An example would be Bloomberg.

In the over-the-counter market, dealers take on the role of market makers. This means that market participants declare the cost of buying or selling assets and execute the transaction. At the same time, the other participants (i.e. with the exception of the two between which the transaction is carried out) cannot be aware of the conditions under which the contract was implemented.

With which types of assets can be made on the over-the-counter market

Market participants have the right to trade on the non-stock market with shares, bonds, derivatives and various structural products. It is worth noting that the network, including official sources, does not have specific information on this topic. This means that there is no specific list of what can be done and what cannot be done on the market without a prescription.

However, the contract under which counterparties deal is radically different from a normal agreement to purchase or sell financial instruments on a stock exchange. In this agreement, the parties may agree on the purchase or sale price, as well as the type of financial instrument and any additions there to it.


The simplest, most popular and developed example of an over-the-counter market is the Forex market. The fact is that brokerage firms in the Forex market, they play the role of the same market makers in relation to the financial instruments that their clients can trade. This means that they themselves support fixed quotes.

When a trader trades to buy or sell currency pairs, this is done inside the brokerage system, but not in the large over-the-counter foreign exchange market. And brokers, in turn, exchange information about prices and other indicators achieved in the company.

However, there is one trick. As we have already mentioned above, there is no single principle that describes the principles of non-existent financial structures. Therefore, Forex brokers set these prices for currency pairs that are primarily beneficial to them and not to you. And since transactions are made within the system, the income goes primarily to the company itself, not to the counterparty.

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