Over the Counter Stock Law and Legal Definition
Over the counter stocks are securities that are not listed and traded on an organized exchange. It is a market in which securities transactions are conducted through telephone and computer network connecting dealers in stocks and bonds, rather than on the floor of an exchange.The stocks are traded directly between two parties. The rules of over-the-counter stock trading are written and enforced largely by the National Association of Securities Dealers (NASD), a self-regulatory group. Prices of over-the-counter stocks are published in daily newspapers, with the National Market System stocks listed separately from the rest of the over-the-counter market.