please excuse my ignorance but could someone please elaborate on the different terminologies?
Wherever I look I find different and contradicting explanations.
Are OTC markets = Dealer markets (as stated in my Schweser notes)? My understanding is that OTC means there’s just 2 parties making a deal without an intermediary. But… if there is a Dealer acting as intermediary, then why would one have counter-party risk. On the other it says Futures are traded in Dealer Markets, which I thought trade on exchanges… So there must be a difference. Or, do Dealers simply Buy/sell on an exchange? Or do dealers buy/sell in OTC markets, along with other participants posting bids and asks (from whom the potential counter party risk stems)?
Could someone please explain why these are the same or why they are different and maybe give an example?