Definition of broker

Generally, an intermediary who helps to effect (who brokers) a transaction between two parties. They normally specialise in a particular business, such as insurance and real estate. In securities trade, the broker acts an agent for a buyer or seller, charging a commission (a brokerage fee) usually based on a percentage of the value of the transaction. Although the terms broker and dealer are sometimes used interchangeably, they are different. Dealers trade on their own account,not as agents, and sell from their own inventory. Many brokerage houses (also known as securities houses) act as both brokers and dealers (hence the term broker-dealer).