question_answer

OTCEI is an exchange established on the lines of NASDAQ to provide quicker liquidity to securities at fixed and fair prices.

(i) What are the advantages of OTCEI?

(ii) What values are looked upon by OTCEI to serve the various stakeholders?

Answer:

(i) Advantages of OTCEI market are given below: (any three) [a] It provides a platform for trading to smaller and less liquid companies as they are not eligible for listing on a regular exchange. [b] Family concerns and closely held companies can go public through OTCEI. [c] Dealers can operate both in new issues and in secondary market at their option. [d] There is no problem of bad and short deliveries. [e] Uniform transparent system of trading with free flow of information between market makers to customers, since there is close contact between them. (ii) Values looked upon by OTCEI are: [a] Safety and fairness in transactions for investors. [b] Equality and opportunity in funds raising for smaller companies.