Markets & trading
Exchange-traded markets use a central venue and standard rules; over-the-counter markets involve dealer or bilateral networks. Transparency, standardisation and counterparty arrangements differ.
Make it click
One marketplace displays standard lots under common rules; another consists of counters where terms are quoted or negotiated. Both can be organised, but information and relationships differ.
Now put that into markets
Listed shares and futures commonly trade on exchanges, while many bonds, currencies and derivatives trade OTC. Electronic platforms can blur the surface distinction.
Exchanges centralise order matching and often clearing. OTC trades can be customised and may use dealers, collateral agreements and central clearing where required.
Check venue, quote source, trade reporting, clearing, contract terms and counterparty. Do not infer liquidity from the label alone.
OTC does not automatically mean unregulated or illiquid, and exchange listing does not remove market risk. Counterparty and documentation can be more prominent OTC.
Takeaway
