Broker/Dealer Flashcards

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1
Q

What is a Dealer

A

Acts on behalf of the brokerage firm, initiating transactions for the firm’s own account

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2
Q

What is a Broker

A

Handles transactions, buying and selling securities on behalf of their clients.

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3
Q

Define Dealer

A

People or firms who buy and sell securities for their own account, whether through a broker or otherwise

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4
Q

Who regulates Dealers?

A

SEC

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5
Q

Who are Market Makers?

A

Dealers

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6
Q

Do brokers trade their own portfolio?

A

No

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7
Q

How does a dealer profit?

A

The spread between the bid and ask prices, while also adding liquidity to the market

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8
Q

Who does a trader buy for?

A

Trader buys and sells securities for their own account—not on a business basis

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9
Q

How does a dealer get paid?

A

Mark-up

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10
Q

How does a broker get paid?

A

Commissions

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