Over the counter exchange vs exchange

Over the counter exchange

v/s stock exchange

What is Over the counter exchange of India(OTC) ????

OTCEL is an electronic stock exchange with the object of providing an opportunity to small &medium companies to assess public funds at a low cost.

Why was it set up?????

It was set up to access high-technology enterprising promoters in raising finance for new product development in a cost effective manner and to provide transparent and efficient trading system to the investors.

Objectives of OTCThe objectives of the OTC are-liquidity-fixed-fair price-simplified process of buying and selling-quick disposal of orders-cheaper method of public sale of new issues

Benefits for company of OTCOTCEI offers facilities to the company having a issued equity capital of more than Rs.30 lakhsSmall & medium closely held company can go publicEncourage entrepreneurshipCompany can get the money before the issue in cases of bought out dealsEasy issue marketing by using the nation-wide OTCEI dealers networkNation wide trading by listing at just 1 exchange

Benefits for investorsEasily accessible by any investorProvide greater confidence to investors because of the complete transparency in IndiaTransactions are fast and completed quicklyEnsures security, liquidity, by offering 2 way quotes,OTCEI is an investors friendly exchange with single window clearance for all investor requests.

What is Stock exchange ????A stock exchange is an entity that provides services for stock brokers and traders to trade stocks, bonds, and other securities. Stock exchanges also provide facilities for issue and redemption of securities and

other financial instruments, and capital events including the payment of income and dividends.

Securities traded on a stock exchange include shares issued by companies, unit trusts, derivatives, pooled

investment products and bonds.

History of Stock ExchangeIn 1609, investors led by one Isaac Le Maire formed history's first bear syndicate.The Dutch West India Company was formed in 1621, bringing a new issuer to the burgeoning securities market.On February 8, 1971, NASDAQ, the world's first electronic stock exchange, started its operations.A bond issued by the Dutch East India Company, dating from 7 November 1623, for the amount of 2,400 florins.

Facts about the Stock Exchange

The Code of Hammurabi recorded interest-bearing loans.In 1609, investors led by one Isaac Le Maire formed history's first bear syndicate.The Dutch West India Company was formed in 1621, bringing a new issuer to the burgeoning securities market.NASDAQ was the first electronic stock exchange.By 1698, a broker named John Castaing, operating out of Jonathan's Coffee House, was posting regular lists of stock and commodity prices. Those lists mark the beginning of the London Stock Exchange.On February 8, 1971, NASDAQ, the world's first electronic stock exchange, started its operations.

The role of stock exchangesRaising capital for businessesMobilizing savings for investmentFacilitating company growthProfit sharingCorporate governanceCreating investment opportunities for small investorsGovernment capital-raising for development projectsBarometer of the economySpeculation

Major stock exchanges of the worldNew York Stock Exchange, New York CityLondon Stock Exchange, the City of LondonTokyo Stock Exchange, TokyoHong Kong Stock Exchange, Hong KongBolsa de Madrid, MadridBombay Stock Exchange, MumbaiToronto Stock Exchange, TorontoSao Paulo Stock Exchange, Sao PauloAustralian Securities Exchange's Sydney exchange centre, SydneyFrankfurt Stock Exchange, FrankfurtParis Stock Exchange, ParisSWX Swiss Exchange, ZurichMexican Stock Exchange, Mexico City

Difference between OTC & Exchange

In exchange markets, there’s a regulator (exchange) through which transactions are completed, while in

OTC markets there is no regulator.Exchange markets have less chances of price

manipulation, while the many competing traders in OTC markets can manipulate prices.

Exchange markets ensure transaction security, while OTC markets are prone to fraud and dishonest

traders.