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Finra Series-6 Exam - Topic 10 Question 98 Discussion

Actual exam question for Finra's Series-6 exam
Question #: 98
Topic #: 10
[All Series-6 Questions]

The primary difference between dealers and brokers is that:

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Suggested Answer: A

Of the selections, only 12b-1 fees and management fees are included in the expense ratio of the fund. Brokerage costs that the fund incurs when it buys and sells securities are not included (which is why a fund's turnover ratio is important to consider.) Redemption fees are paid by the shareholder to the fund, so it would not be included in a fund's expense ratio since it is not an expense of the fund.


by Danica at Mar 08, 2025, 11:28 AM

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Carylon
3 months ago
Wait, are dealers really just market makers? That’s surprising!
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Kimberlie
3 months ago
I thought brokers could also operate in the primary market?
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Oretha
4 months ago
Definitely agree with C. Makes total sense!
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Ceola
4 months ago
B is misleading, brokers deal with more than just stocks and bonds.
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Katina
4 months ago
C is spot on! Dealers really do make the market.
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Micaela
4 months ago
I’m confused about B because I thought brokers could deal with various types of securities, not just stocks and bonds. Could D be correct?
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Loreta
5 months ago
I practiced a question similar to this, and I think it emphasized that dealers are market makers. So C seems to fit what I learned.
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Jutta
5 months ago
I'm not entirely sure, but I feel like brokers can operate in both markets, not just the secondary one. That makes me hesitant about A.
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Shalon
5 months ago
I think I remember that dealers actually hold inventory, while brokers just facilitate trades. So maybe C is the right answer?
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Fletcher
5 months ago
Ah yes, I remember learning about this in class. Dealers are the ones who provide liquidity by trading from their own accounts, while brokers just facilitate trades between other parties. Option C is the winner here.
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Lenny
5 months ago
Dealers and brokers operate in different markets, that much I know. But I can't quite recall the specifics. I'll have to think this through carefully.
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Argelia
5 months ago
Hmm, I'm a bit confused on the difference between the primary and secondary markets. I'll need to review that before I can confidently answer this question.
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Yvonne
6 months ago
I think the key difference is that dealers are market makers who buy and sell from their own inventory, while brokers just match buyers and sellers. Option C looks like the best answer.
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Sheron
10 months ago
Well, if you're a dealer, you're basically the one-stop-shop for all your clients' trading needs. Brokers, on the other hand, are like the matchmakers of the financial world - they just bring the parties together and let them do the dance.
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Francesco
10 months ago
C is the way to go. Dealers are the ones who take the risk and provide the liquidity, while brokers are just the middlemen.
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Laurel
9 months ago
Exactly, dealers provide liquidity in the market while brokers facilitate trades.
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Leonardo
9 months ago
So, dealers are like market makers while brokers are like matchmakers.
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Kizzy
9 months ago
That's true, brokers just connect buyers and sellers without taking on any risk.
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Adelle
10 months ago
I agree, dealers are the ones who take on the risk by holding inventory.
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Barrie
11 months ago
Hmm, I was leaning towards B, but C makes more sense. Dealers are the ones who hold the inventory and make the market.
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Mozell
9 months ago
So, it seems like the primary difference is that dealers hold inventory and make the market, while brokers just facilitate trades.
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Madonna
9 months ago
I agree, dealers are the ones who buy and sell from their own inventory, while brokers just connect buyers and sellers.
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Leslee
10 months ago
I think C is the correct answer. Dealers are market makers who hold inventory, while brokers match buyers and sellers.
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Kasandra
11 months ago
I think D is the correct answer. Both the differences in B and C are valid between dealers and brokers.
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Chu
11 months ago
Yes, D is the most comprehensive choice that describes the distinctions between dealers and brokers.
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Shala
11 months ago
I agree, D seems to cover all the differences between dealers and brokers.
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Deonna
11 months ago
Hmm, that makes sense too. I see where you're coming from.
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Adelaide
11 months ago
Definitely C, dealers are the ones who buy and sell from their own inventory, while brokers just match buyers and sellers.
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Cathrine
10 months ago
Yes, that's correct. Dealers take on more risk by holding inventory, while brokers do not.
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Stefan
10 months ago
So, the primary difference is that dealers trade from their own inventory, while brokers do not.
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Shaun
10 months ago
Brokers just connect buyers and sellers without holding inventory.
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Gussie
10 months ago
I agree, dealers are market makers who trade from their own inventory.
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Josefa
12 months ago
I disagree, I believe the answer is D. Both B and C describe the differences.
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Deonna
12 months ago
I think the answer is C. Dealers are market makers and brokers are matchmakers.
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