Glossary of Municipal Securities Terms


securities transaction executed by a municipal securities dealer, acting as a broker, on behalf of and under the instruction of another party. The municipal securities dealer does not act in a principal capacity and may be compensated by a commission or fee (which must be disclosed to the party for whom it is acting) rather than by a mark-up. To function as a customer’s agent, a municipal securities dealer must disclose or express willingness to disclose the identity of the other side of the transaction. See: AGENCY TRADE; CUSTOMER TRADE; INTER-DEALER TRADE. Compare: PRINCIPAL TRADE.

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