In the context of sell-side equity revenue, when a dealer acts as an agent for a client's trade, the revenue is typically earned as a commission. The dealer facilitates the trade between buyers and sellers without taking ownership of the securities, earning fees for providing this service.

Types of Revenue in Sell-Side Trading:

Commission: Earned when the dealer acts as an agent.

Spreads: Earned when the dealer acts as a principal, buying securities at one price and selling at a higher price.

Fees: Charged for additional services, such as research or analytics.

Interest: Earned from financing activities or margin accounts, not directly tied to trading.

Explanation of Options:

A . Fees: Incorrect; fees are typically charged for services, not for acting as an agent.

B . Spreads: Incorrect; spreads are earned when the dealer acts as a principal.

C . Interest: Incorrect; interest revenue is unrelated to acting as an agent.

D . Commission: Correct answer. Acting as an agent involves earning commissions for facilitating trades.

CSC Volume 2, Chapter 27: The Role of Sell-Side Dealers, which details revenue models in institutional and retail trading.