Over-the-Counter Option

Definition:

An option traded off-exchange, as opposed to a listed stock option. The OTC option has a direct link between buyer and seller, has no secondary market, and has no standardization of striking prices and expiration dates. See also Secondary Market.

Investing Essentials


Copyright © 2011 Campbell R. Harvey, Professor of Finance, Fuqua School of Business at Duke University

Term of the Day

Foreign Credit Insurance Association (FCIA)

A private consortium of US insurance companies that offers trade credit insurance to US exporters in conjunction with the US Export-Import Bank.

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