is a company
that trades securities
for customers as well as for its own account. In the United States, a broker-dealer has to be registered with the Financial Industry Regulatory Authority
. When executing trade orders on behalf of a customer, the institution is said to be acting as a broker
. When executing trades for its own account, the institution is said to be acting as a dealer
. Securities bought from clients or other firms in the capacity of dealer may be sold to clients or other firms acting again in the capacity of dealer, or they may become a part of the firm's holdings.
There are two types of broker dealers: introducing and clearing.