Dealer is a firm or professional working within the firm that is in the business of acting as a counterparty or principle to foreign currency transactions.
Dealer is a person or company performing exchange or trading mediation at its own expense and on its own behalf.
It has a place on the stock exchange (optional), makes quotation of securities and other assets.
In the case of dealing centre (DC) it forms a stream of quotations to customers, accepts funds of customers on its accounts and pays out compensation.
Revenues of the dealer are formed by the difference (spread) between quotations for the purchase and sale of currencies and securities (CFD), and also due to changes in their rates in case of loss of the clients.
The dealer is an organization that is authorized to quote rates (contracts for differences of shares, commodity futures, financial instruments).
That is, when working through a dealer customer orders at the discretion of the dealer can be displayed directly on the stock exchange (the bank), or taken to the balance of the dealer.
The dealer has the right to give its price for the customer.
A direct example of this is the insertion of spread in stock prices or commodity futures, and then there come out CFD tools.
The client enters into a contract to buy or sell CFD with the Dealer.
FOREX and CFD markets are not centralized exchange markets; therefore each dealer company is, in fact, an exchange in its own for their customers which is not always accountable to any regulatory and supervisory institutions.
On the one hand, this
situation creates a fertile ground for various forms of abuse, but on the other – allows speculation on exchange rates for the players with the minimum amount of accounts.