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I've found references that this term is originally used for the purchase of stocks that not listed on the stock exchange.

From etymology.com:

Adjective phrase over-the-counter is attested from 1875, originally of stocks and shares.

It seems like it could mean two things:

  • Stock is sold retail rather than through an exchange. The exchange takes place simply by handing the stock "over the counter" rather than through a third party exchange.
  • Stock is sold "on the other side of the counter" rather than "behind" the counter which implies unlisted.

I would be appreciative if someone with an OED subscription wouldn't mind taking a look and seeing if maybe this was derived from another term or if some of the earlier documented references of its use could give some hints.

  • Good question. I'll be waiting for an answer with you. – user98990 Jun 22 '15 at 3:21
  • This question is about the provenance of the term, which is in finances. For perspective (in case people are confused like I was) there is a second medical meaning: the first thing that comes to mind is 'I bought some over-the-counter pain relievers for my back' meaning I bought some medicine available in a drug store without needing a prescription (necessitating a doctor to prescribe it and a pharmacist to prepare it). For example, a bottle of aspirin is usually sold over-the-counter. – Mitch Jun 22 '15 at 12:55
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    @Mitch - I think the medical/finance idiomatic usage is explained in the answer, but OP seems to be asking for the original meaning of OTC, before it was used idiomatically. – user66974 Jun 22 '15 at 13:09
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    @Josh61 You're all well ahead of me. I just wanted to put a sign post here for people like me who might be confused expecting a question about going to the drugstore when really it's about where that came from. I've always wondered what OTC stocks, and why they would be described with the same words as pharmaceuticals. Now I know it's the other way round. – Mitch Jun 22 '15 at 13:56
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Over-the -counter is quite an old expression whose meaning is just literal, and refer to an informal sale, generally in a shop, without any specific rule or prescription. (Ngram)

  • Mr. PURVER:' In England, nearly all bread was sold over the counter ; here, it was nearly all sold by delivery. In England, the bread was weighed over the counter. Mr. O'CONNOR said he was very glad to have received the deputation and to ...(Votes & Proceedings, Volume 2 -1803 Di New South Wales. Parliament. Legislative Council)

  • B.S. Keeps in a small town a wine and spirit vaults, selling over the counter, and ( on market days only) providing also rooms for customers to sit down in. B. S. does not reside at the premises, but they belong to and are occupied by a relative , ...(Justice of the Peace and Local Government Review, Volume 12-1844)

  • The idea is that of a shop, where you generally have a counter with on one side the shop-assistant and a client on the other side. The product is sold and handed over the counter to the client . Nowadays you help yourself at the counter and go to the cashier directly. –

Idiomatically it is commonly used in (pharmacy) and finance:

  • Legal for sale or distribution without the requirement of a prescription (of medicine and other treatments); abbreviated as OTC. (Wiktionary)
  • Over-the-counter in finance, simply refers to an exchange of shares or bonds which are not listed in official markets, or , even though they are listed, volumes are too thin to allow proper transactions, so OTC transaction are carried out between a buyer and a seller, generally through a brokerage house, but without going thorough the official markets. (Wikipedia)
  • You refer to what the over-the-counter idiom means, but i what I've asked (or meant to ask) it what the literal words "over the counter" mean in this context, without an idiom. Does it mean on the other side of the counter? Or that we're selling it by passing the item on top of the counter? – user606723 Jun 22 '15 at 7:25
  • Or rather, why is it called over-the-counter. Where did such an expression come from originally? – user606723 Jun 22 '15 at 7:26
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    The reference is to a shop, where you generally have a counter and on the one side the shop-assistant while on the other side the client. The product is sold and handed over the counter to the client. That is the image. The highlighted sentence above bread is sold over the counter refers to that kind of sale. Nowadays you help yourself at the counter and go to the cashier directly. – user66974 Jun 22 '15 at 7:28
  • Ah, I missed that. Do you have any more examples? – user606723 Jun 22 '15 at 7:31
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    Arguably, 'over the counter' meaning '[to be found] on the opposite side of the counter' could be described as a 'literal' usage. Prepositional usage is far from simple, and the degree of metaphor used in individual usages complex and debated. But a good answer. – Edwin Ashworth Jun 22 '15 at 8:18

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