Published Feb 7, 2023 A broker-dealer (B-D) is a financial services firm that acts as both a broker and a dealer. That means it can both buy and sell securities for its own account and on behalf of its customers. Broker-dealers are typically registered with the Securities and Exchange Commission (SEC) and are subject to its regulations. To illustrate this, let’s look at a broker-dealer called ABC Securities. ABC Securities is a full-service broker-dealer that offers a wide range of services to its customers. On the one hand, it can buy and sell securities on behalf of its customers. That means it can execute trades for them and provide them with advice on which investments to make. On the other hand, ABC Securities can also buy and sell securities for its own account. That means it can speculate on the markets and make profits from price movements. Broker-dealers are an important part of the financial system. They provide liquidity to the markets by buying and selling securities on behalf of their customers. In addition to that, they also provide advice to their customers on which investments to make. That means they can help their customers to make informed decisions and maximize their returns. Finally, broker-dealers also provide an important source of revenue for the financial system. By buying and selling securities for their own account, they can generate profits that can be used to finance other activities.Definition of Broker-Dealer
Example
Why Broker-Dealers Matter
Financial Economics