A broker isapersonorentitythat arrangescontractsand acts as an intermediary between a buyer andsellerfor acommission. A broker is an independent party to a transaction and should not be confused with anagentwho acts on behalf of a principal party in a deal. There are many types of brokers, and they appear in several different industries. For example, broker-dealer for tradingsecurities, customs broker,real estate broker, insurance broker,mortgage brokeretc.
Additionally, brokers in many fields are regulated and licensed by each state and have afiduciary dutyto act in the best interests of their customers or clients. Brokerage firms are also generally subject to regulations based on the type of brokerage andjurisdiction.
[Last updated in June of 2022 by the Wex Definitions Team]
