OTCEI Vs. OTHER STOCK EXCHANGES OTCEl is different from the regular stock exchange in the following ways: ‘SLNo Feature OTCEL Traditional Stock Exchanges 1. Formation Organization promoted by financial | Assoctation formed by brokers of the ‘institutions exchange 2 | Number ‘Only one stock exchange called the OTCE! | Twenty-two stock exchanges exist exists with u nationwide reach independently in the country (including NSE) 3. | Listing ‘Companies with equity shure capital | Companies with equity share capital of between Rs.30 lakhs and Rs.25 crores are | Rs.3 crores and above are allowed listing allowed to be listed 4 Coverage ‘Decentralized exchange with a nation-wide | Centralized exchange with members network operating at a single location (except BSE} —— 5. | Transferable | Share certificate is not a transferable | Ordinarily share certificate acts asa | Document document. Counter Receipt (CR) was the | transferable document transferable document earlier which has since been discontinued 6. | Computer Scrven-based trading with computer | ‘Trading is done in a trading halliring by Usage network public outcry (except BSE) 7. | Transfer Mode | Securities are transferred through ‘counter | Securities are transfered by transferring receipts’ share certificates through demating & | Transparency . | Spot deals with full transparency Speculative activities obstruct transparency 9. | Settlement Daily settlement system Weekly or fartnightly settlement 10, | Price Quotes | Market-makers are obliged ta offer two- | Jobers may ot may not offer two-way ‘way quotes quotes Hi, | Transfer Automatic: transfer upto 0.S percent of | Transfer takes: place with the permission of to Capital ‘equity capital of the company the company 12. | Spreads OTCE! has laid down that market spreads | There is no restriction on spreads volatile would not exceed a specified percentage 13. | FreePricing | SEBI guidelines permit free pricing of | As per SEBI guidclines, free pricing of issues without a track record also under certain conditions Equity of new company shares is not permitted