When we say a derivative contract trades Over the Counter (OTC) what does that mean? Would a company prefer OTC? Please explain in your own words.
Question
When we say a derivative contract trades Over the Counter (OTC) what does that mean?
Would a company prefer OTC? Please explain in your own words.
Solution
When we say a derivative contract trades Over the Counter (OTC), it means that the contract is traded directly between two parties, without going through an exchange or other intermediaries. This is typically done through a dealer network. OTC markets are less transparent than exchanges and are subj
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