Cotman arrives from Triglav Krani, who have produced a number of promising youngsters in recent years.
Under-17 international Cotman almost joined Italian side Empoli last year, but a dispute between the clubs saw the move fail to materialise.
Now Wolves have stepped in to land the young keeper.
"The fee was not big as we wanted, but we had to offer the boy the chance to move forward with his career," said Triglav director Miran Subic.
"We are extremely proud to sell one of our players to a Premier League side."