Welcome to The Expert Exchange, part of our Investing Has No Borders series — a global look at how investors can unlock opportunities beyond their home markets.
In this session, we focus on U.S. markets with Jason Paltrowitz, Executive Vice President at OTC Markets Group, the largest U.S. trading venue for international equities. Jason breaks down how OTC Markets works, how cross-border access has evolved, and what global small-cap investors should expect next.
Watch the full video, or read the transcript below.
TMO: Welcome to The Expert Exchange, and thanks for joining us for the first session in our Investing Has No Borders series — an informative look at how investors around the world can access opportunities outside their home markets.
Today, we’re focusing on the U.S. markets, and joining us is Jason Paltrowitz, Executive Vice President at OTC Markets Group.
Jason, can you start by giving us a quick explanation of how OTC Markets works and how the platform has evolved to make cross-border access easier for investors?
Jason: Sure — and thanks for having me. Many people don’t realize this, but OTC Markets is actually the largest stock market in the United States for non-U.S. equities. We’re home to some of the biggest companies from Canada and around the world — Air Canada, Adidas, Roche, Heineken — as well as early-stage growth and developing companies looking to access the breadth and depth of U.S. investors.
Unlike the larger U.S. exchanges such as the NYSE or Nasdaq, we’re primarily a secondary market. Companies can go public in their home exchanges — Canada, London, Paris, Germany, and others — and then passport their home-market disclosure into the U.S. in a more cost-effective and efficient way.
They don’t need to be SEC-reporting companies, they don’t need to comply with Sarbanes-Oxley, and they don’t need to reconcile to U.S. GAAP. Because of that, we now have companies from over 70 countries that want access to the U.S. investor base — the largest in the world — while still mitigating the costs and risks of a traditional U.S. listing.
TMO: For companies already listed on exchanges like the ASX or CSE, what advantages does an OTC quotation provide?
Jason: The main advantage is the ability to passport home-market disclosure. The U.S. has a concept called the foreign private issuer exemption — SEC Rule 12g3-2(b). It says that if you’re listed on a primary exchange outside the U.S., in good standing, and you make your disclosure available in English to us at OTC Markets, you can have your securities trade in the U.S. without the cost and complexity of a traditional U.S. exchange listing.
This allows companies to stay national champions — raising capital and remaining primary in their home market — while still gaining access to the same pool of U.S. capital. It’s a bridge or gateway for global companies seeking U.S. investor reach.
TMO: And if an international investor buys a U.S. OTC security, what should they understand about settlement or FX conversion fees? Does this differ by region?
Jason: Most investors trading on our market are U.S. investors — that’s the advantage we provide.
What makes us a bit different is that, as a secondary market, many of these securities are actually traded, settled, and cleared in the home market. If you’re a U.S. investor using Schwab, for example, and you buy 100 shares of a Canadian resource company, it will look like a U.S. trade: priced in dollars, with a U.S. ticker symbol. But that trade may actually execute in Canada.
For the investor, it’s quite transparent. Market makers quote in U.S. dollars and “bake in” the FX. Occasionally, there may be small peripheral costs, but overall the experience is seamless.
TMO: How is international demand for U.S. small-cap exposure trending? Are you seeing growth in interest from regions like Canada, Australia, or the UK?
Jason: We’ve always had a deep relationship with Canada. U.S. investors have traditionally been the natural investor base for Canadian early-stage growth companies, especially in mining, resources, and exploration.
There’s a large ecosystem of self-directed U.S. high-net-worth investors who love opportunities in Canadian and Australian markets — not only in mining and resources, but also in green tech, fintech, AI, and other pre-revenue industries.
This year we’ve seen a tremendous increase in interest for non-U.S. equities — not just from Canada, but from across EMEA, Europe, and Asia. We’re seeing a significant uptick in dollar-volume growth, with many UK companies joining to tap into the U.S. investor opportunity.
TMO: And naturally, the next question is: what’s next for the global small-cap investment landscape?
Jason: I think we’ll see more of the same. We’re in a boom cycle for mining and resources. There’s huge interest in technology, AI, green tech, pharma, and biotech.
There’s also a lot of cash on the sidelines, and no sign of that slowing.
What’s interesting is that the U.S. market has become highly concentrated. The top 10 stocks in the S&P 500 account for 40% of the index. Outside those big tech names, the rest of the U.S. market hasn’t performed as strongly — so U.S. investors are increasingly looking abroad for opportunity.
We expect that trend to continue into next year. And we’re seeing growing interest in companies from Germany, Switzerland, Austria, Hong Kong, alongside Canada, the UK, and Australia. There’s still plenty of opportunity outside the U.S.
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