SIE Exam Question 150: Answer and Explanation

Question: 150

Which of the following are considered to be actions falling under the role of a dealer?

I. Charges a commission for their services

II. Participates in the trade by trading in and out of his or her own account

III. Fills the role of market maker

IV. May facilitate only the order execution for a customer

• A. II only
• B. I, II, and III
• C. I and IV
• D. II and III

Correct Answer: D

Explanation:

Actions falling under the role of a dealer include participating in trades by trading in and out of his or her own account, such as using securities in the account to fill a buy order or buying securities for the account to fill a customer's sell order. Further, making a market in a security is also an action performed by a dealer. Conversely, a broker simply facilitates order execution for a customer, while not participating in the transaction, and charges a commission for their services.