When a broker-dealer makes securities transactions on behalf of others rather than for its own account, the firm is acting as a(n):

When a broker-dealer executes transactions on behalf of clients, they are functioning as an agent. In this capacity, the broker-dealer acts as an intermediary between buyers and sellers, facilitating trades without taking ownership of the securities. This is a key aspect of agency transactions, where the broker-dealer's role is to execute trades for clients, relying on the clients to provide the necessary capital, while earning a commission or fee for their services.

In contrast, when a broker-dealer acts as a principal, it buys or sells securities for its own account—taking on the risk of ownership. Investors are individuals or entities that purchase and hold securities for potential appreciation or income. Lastly, underwriters are typically involved in the process of issuing new securities and helping companies raise capital, rather than executing trades for clients. Thus, the definition of an agent fits perfectly in this scenario of executing trades on behalf of others.