BREAKING DOWN 'Over-The-Counter - OTC'For many investors, there is little practical difference between OTC and major exchanges. Improvements in electronic quotation and trading have facilitated higher liquidity and better information. However, there are key differences between the transaction mediums. On an exchange, every party is exposed to offers by every other counterparty, which may not be the case in dealer networks. There is less transparency and less stringent regulation on these exchange," so unsophisticated investors take on additional risk and could be subject to adverse conditions.Read more: Over-The-Counter (OTC) http://www.investopedia.com/terms/o/otc.asp#ixzz4kh4z464w