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Explain the role of a dealer in the OTC market

Explain the role of a dealer in the OTC market.

Dealers make their living purchasing securities and reselling them to others. They operate like car dealers who purchase cars from manufacturers for resale to others. Dealers make money through buying securities for one price (called the bid price) and selling them for higher price, (called the ask price). The difference, or spread, among the bid price and the ask price show the dealer’s fee.

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