Market participants tests who is acting, and in what capacity. A firm selling from its own inventory acts as a dealer or principal and adds a markup; a firm arranging a trade between others acts as a broker or agent and charges a commission. The same firm can do both, but not on the same trade.
20% of the bank for this topic is rated hard — well above the exam average. Budget more time here than its blueprint weight alone suggests.
Question-type mix across the 80 questions in this topic.
With the explanation — which is the part that teaches.
When a firm trades from its own account and compensates itself through a markup (or markdown), it is acting as a dealer, or principal. A broker (agent) instead arranges a trade for a customer and charges a commission.
At SIE depth, an introducing broker generally has the customer relationship, while a clearing broker performs clearance, settlement, custody, and related back-office functions.
A broker-dealer effects securities transactions for customer accounts and may receive transaction-based compensation. Investment advisers, municipal advisors, and transfer agents have different roles.
Every one carries the same kind of explanation. Ten a day at no cost, no card.
Real-format questions, an explanation on every answer, and a mistake bank that only clears when you get it right.
