What term describes a group of brokerage houses formed by the originating house to sell a security?

A syndicate refers to a group of brokerage houses that come together, usually under the leadership of an originating firm, to sell a security. This collaboration allows the participating members to pool resources and share the risks involved in underwriting or distributing a new issue of securities, such as stocks or bonds. The syndicate works collectively to facilitate the sale, often enabling them to reach a wider array of investors than any single firm could achieve on its own.

In this context, forming a syndicate allows for a more efficient process because it combines the expertise and distribution capabilities of multiple firms. The lead broker or originating house often takes the primary role in organizing the syndicate, determining pricing, and managing the logistics of the sale. This collective effort is particularly beneficial for larger issues of securities that may be challenging for one brokerage to handle independently.