Over‑the‑counter (OTC) market data refers to pricing, trade and liquidity data generated from activity in OTC markets.
OTC markets are decentralised markets where transactions are negotiated directly between counterparties, rather than executed on a central exchange. As a result, OTC market data is used to understand pricing, liquidity and risk in markets where information is not centrally published.
In simple terms, OTC market data shows where and how markets are trading across decentralised markets, where prices are not published on a central exchange and are accessed through data providers with different roles in the OTC ecosystem, bringing this information together across multiple pricing structures and methodologies.
Key characteristics of OTC markets vs exchange markets
OTC markets differ from exchange‑traded markets in several important ways:
- bilateral negotiation: transactions are agreed directly between counterparties rather than matched on a central order book
- decentralised trading: no single exchange provides a complete view of prices or trading activity
- fragmented liquidity: market activity is spread across multiple participants, venues and instruments
- limited transparency: not all trades, quotes or liquidity are publicly visible in real time
Because of these characteristics, OTC market data is inherently more complex than exchange‑traded data. Pricing and liquidity are distributed across the market, which means reliable OTC market data must be sourced from across the market and delivered in a structured way.
As a result, a range of data providers and supporting market infrastructure have developed to collect, structure and deliver OTC market data in usable forms, enabling it to support trading, valuation, risk management and governance workflows.
How OTC market data is sourced and used
OTC market data can be sourced in several ways, depending on how trading activity is captured and processed.
Common sources include:
- interdealer broker data
- dealer or contributor submissions
- vendor‑aggregated or modelled data
- evaluated or consensus pricing services
Some OTC data reflects direct market activity, such as executed trades or live quotes. Other data is aggregated, interpolated or modelled to provide more complete coverage across instruments, markets or time series.
Each source provides a different view of the market and varies in:
- proximity to underlying trading activity
- level of processing or modelling
- transparency and observability
These differences directly affect how the data can be used in practice. For example, data captured close to price formation may be suited to trading or validation use cases, while more processed data may be required to support valuation, risk or analytics workflows at scale.
Understanding how OTC market data is sourced and transformed is essential when assessing its suitability for specific use cases.
What markets are included in OTC trading
OTC markets span a wide range of asset classes across financial and physical markets. These include, but are not limited to:
Capital markets
OTC capital markets cover a broad set of financial instruments where pricing and liquidity are formed outside of centralised exchanges. These include:
- interest rate swaps and swaptions
- foreign exchange (FX)
- money markets, including repo, deposits and certificates of deposit
- credit derivatives, such as credit default swaps
- equities and equity‑related derivatives, including variance swaps and dividend swaps
- inflation derivatives
These markets are used extensively across trading, valuation, risk management and regulatory workflows by banks, asset managers and other market participants.
Energy and commodities
OTC energy and commodities markets play a central role in global physical and derivative contracts, supporting trading, hedging and operational decision-making. These include:
- oil, including crude, distillates, LPG, fuel oil and refined products
- gas and LNG
- power
- coal
- emissions, including carbon and biofuels
- metals, such as precious metals and iron ore
- freight and tanker rates
Participants rely on OTC market data to understand pricing, liquidity and risk across both physical and derivative contracts.
Across these asset classes, OTC markets represent a significant share of global trading activity, particularly in derivatives and wholesale financial markets.
Who participates in OTC markets
OTC markets involve a wide range of participants, including:
- dealers and investment banks providing liquidity and making markets
- interdealer brokers and electronic platforms facilitating trading
- hedge funds and asset managers trading and managing risk
- insurance companies and pension funds managing long‑term exposures
- corporates hedging interest rate, FX or commodity risks
Each participant plays a role in price formation and contributes to the overall flow of OTC market data.
Who uses OTC market data and why
OTC market data is used across a wide range of market participants and functions, spanning financial institutions, trading firms and corporates active in OTC markets.
Typical use cases include:
- trading and execution: identifying liquidity, market depth and executable price levels
- risk management: modelling exposures, stress testing and value‑at‑risk (VaR)
- valuation and pricing: supporting portfolio valuation, price verification and valuation control
- compliance, governance and reporting: evidencing fair value, best execution and internal controls
For example, hedge funds and asset managers may use OTC market data to support trading strategies, risk modelling and back‑testing. In energy and commodities markets, trading firms and corporates rely on OTC data to manage price risk, value physical and derivative positions, and support internal governance and reporting processes. Insurers and other long‑term holders of OTC exposures may use the data to support valuation and audit requirements.
How to choose OTC market data
Because OTC market data varies widely in how it is sourced, constructed and delivered, selecting the right data is an important consideration.
At a high level, firms typically assess OTC market data based on:
- transparency of methodology: how prices are formed and whether inputs can be understood
- proximity to market activity: how closely the data reflects underlying trading and liquidity
- breadth and depth of coverage: across asset classes, instruments and time horizons
- suitability for specific workflows: such as trading, valuation, risk management, hedging or governance
Many firms use a combination of OTC data types, for example, transactional, indicative or evaluated pricing, balancing observability, coverage and usability depending on how the data will be used.
To understand these trade‑offs in more detail, it is helpful to look at how different types of OTC pricing data are constructed and where they sit relative to underlying market activity.
FAQs
What is OTC market data?
OTC market data is pricing, trade and liquidity data generated from over-the-counter markets, where transactions are negotiated directly between participants rather than executed on a central exchange.
What types of data exist in OTC markets?
OTC markets use different types of data, including trade and order data, indicative pricing, evaluated or verifiable pricing, composite data and consensus data.
Why is OTC data less transparent than exchange data?
OTC data is less transparent than exchange data because trading takes place across multiple participants and venues rather than on a single exchange, meaning prices and trades are not centrally published or consolidated.
What is the difference between OTC data and exchange data?
OTC data is derived from decentralised, bilateral trading activity across market participants, while exchange data comes from centralised order books where prices, trades and volumes are publicly visible.
How is OTC market data sourced?
OTC market data is sourced from a range of providers, including interdealer brokers, dealer submissions and vendor‑aggregated data, with different pricing structures reflecting how trading activity is captured, processed and distributed.
Disclaimer
© 2026 ICAP Information Services Limited (“IISL”). This communication is provided by ICAP Information Services Limited or a member of its group (“Parameta”) and all information contained in or attached hereto (the “Information”) is for information purposes only and is confidential. Access to the Information by anyone other than the intended recipient is unauthorised without Parameta’s prior written approval. The Information may not be not used or disclosed for any purpose without Parameta’s prior written approval, including without limitation, storing, copying, distributing, licensing, selling or displaying the Information, using the Information in an application or to create derived data of any kind, co-mingling the Information with any other data or using the data for any unlawful purpose of for any purpose that would cause it to become a benchmark under any law, regulation or guidance. The Information is not, and should not be construed as, a live price, an offer, bid, recommendation or solicitation in relation to any financial instrument or investment or to participate in any particular trading strategy or constituting financial or investment advice or a financial promotion. The Information does not constitute a public offer under any applicable legislation or an offer to sell or a solicitation of an offer to buy any securities. The Information is not to be relied upon for any purpose whatsoever and is provided “as is” without warranty of any kind, either expressly or by implication, including without limitation as to completeness, timeliness, accuracy, continuity, merchantability or fitness for any particular purpose. All representations and warranties are expressly disclaimed, to the fullest extent possible under applicable law. In no circumstances will Parameta be liable for any indirect or direct loss, or consequential loss or damages including without limitation, loss of business or profits arising from the use of or any inability to use the Information, or any inaccuracy in the Information. Parameta may suspend, withdraw or modify or change the terms of the provision of the Information at any time in its sole discretion, without notice. All rights, including without limitation intellectual property rights, in and to the Information are, and shall remain, the property of IISL or its licensors. Use of, access to or delivery of Parameta’s products and/or services requires a prior written licence from Parameta or its relevant affiliates. The terms of this disclaimer are governed by the laws of England and Wales.
Latest Insights
See All
What are Credit Default Swaps and How Do They Work?
Seeing the Market Clearly: Why Price Discovery Is Getting Harder
