Broker-Dealer

A broker-dealer is a financial firm or individual that engages in the business of buying and selling securities, such as stocks, bonds, options, and other investment products, on behalf of clients or for their own account. They act as intermediaries between buyers and sellers in financial markets. Broker-dealers can provide various services, including executing trades, offering investment advice, underwriting securities offerings, facilitating mergers and acquisitions, and managing investment portfolios.

Broker-dealers are regulated by financial regulatory authorities in the jurisdictions where they operate, such as the Securities and Exchange Commission (SEC) in the United States. They are required to adhere to strict rules and regulations to ensure fair and transparent dealings in the financial markets and to protect the interests of investors. Additionally, they are often members of self-regulatory organizations (SROs) like the Financial Industry Regulatory Authority (FINRA) in the U.S., which further oversee their activities and enforce industry standards.

See also History of Securities Regulation in the USA.