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Finance
Dealer
A firm or individual that buys and sells financial assets for their own account. Unlike brokers, dealers take on risk by holding inventory of securities or other financial instruments. They provide liquidity and help markets operate efficiently while seeking to earn profits from price differences.
Dealers are critical to market functioning because they provide liquidity and facilitate continuous trading. By holding inventory, they can meet immediate demand for buying or selling assets. While this involves risk, their presence ensures that buyers and sellers can transact without long delays.
Dealers may specialize in specific securities, commodities, or derivatives, and they often operate in both retail and institutional markets. Their strategies require expertise in pricing, risk management, and market trends.