Mechanics behind OTC markets

Hello.

I was wondering what OTC is? It’s a different way of trading than we are used to?

I suspect my lack of knowledge on this subject is showing also.

Despite having been an invertor since 2016, this is an area with hold in my knowledge base.

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Should probably get that checked out.

(Sorry I was unhelpful, I don’t know much about OTC’s)

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OTC is typically much smaller companies and have low threshold for audit compliance.

In Kiplinger in 2017, Dan Burrows wrote that American OTC markets are rife with penny stock fraud and other risks, and should generally be avoided by investors “with the exception of large, established foreign firms”.

Thanks for the explanation. Now I know. I would only touch mature companies and personally wouldn’t go near buying small cap stocks individually.

I do have a worldwide small cap ETF though.

Anyway that’s not important right now and now I have an answer to the question. :hugs::+1:

There are some big names on OTC including LVMH but soon we’ll be able to buy most of the bigger more stable companies on their native exchanges.