What's What in the Financial Services Industry

Broker-Dealer Agent

Definition: a person in the business of buying and selling securities operating as both a broker and a dealer depending on the transaction. Technically, a broker is only an agent who executes orders on behalf of clients, whereas a dealer acts as a principal and trades for his or her own account. Because most brokerages act as both brokers and principals, the term broker-dealer is commonly used to describe them.

License: Series 7 (required), Series 63 (required), Series 66 (optional), Series 24 (required for principal agents)

Regulated by: on the federal level, broker-dealer agents are regulated by the Financial Industry Regulatory Authority (FINRA); on the state level they are regulated by the Indiana Securities Division

Standard of Care: suitability responsibility

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Explanation of License Exams:

  • Series 7 - General securities representative exam
  • Series 63 - Uniform state law exam
  • Series 65 - Investment adviser exam
  • Series 66 - Uniform combined state law exam
  • Series 24 - General securities principal

Related Information: