Which market involves the trading of exchange-listed securities in the OTC market?

The Third Market refers to the trading of exchange-listed securities in the over-the-counter (OTC) market. This market is characterized by transactions that occur between broker-dealers and institutional investors, rather than on a traditional stock exchange. The significance of the Third Market lies in its ability to provide additional liquidity and allow larger volumes of trades to occur outside of the exchange environment, potentially at better prices.

In this context, the focus on exchange-listed securities reflects the flexibility and accessibility that the OTC market offers to participants looking to buy or sell large quantities without impacting the market price significantly. It underscores the role of the Third Market in facilitating trades that would otherwise be cumbersome if conducted solely through stock exchanges. This distinctive function sets it apart from other markets.