A person regularly engaged in the business of buying or selling securities for its own account (see Section 2(a)(12) of the Securities Act and Section 3(a)(5)(A) of the Exchange Act). Unlike a broker, who only acts as an agent for a customer in exchange for a commission, a dealer typically acts as a principal by dealing in securities for its own inventory as part of a regular business. A trader is not considered a dealer since it does not engage in transactions for its own account as part of a regular business.

A dealer can also act as a broker. Dealers are subject to regulatory oversight by the SEC and must also register with a self-regulatory organization. Dealers may also be subject to state regulation under blue sky laws.

For more information on the registration requirements, see Practice Note, Broker-Dealer Registration Overview and Practice Note, Determining Broker-Dealer Status.