Trading For Canadians For Dummies
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For the Series 7 exam, you need to know some basic information about trade confirmations. A trade confirmation (receipt of trade) is the document you send to a customer after a trade has taken place. You have to send out trade confirmations after each trade, at or before the completion of the transaction (the settlement date). Here's a list of information included in the confirmation:

  • The customer's account number

  • The registered rep's ID number

  • The trade date

  • Whether the customer bought (BOT) or sold (SLD)

  • The number of shares of stock or the par value of bonds purchased or sold

  • The yield (if bonds)

  • The Committee on Uniform Security Identification Procedures (CUSIP) number, a security ID number

  • The price of the security

  • The total amount paid or received, not including commission

  • The commission, which is added on purchases and subtracted on sales (if the broker-dealer purchased for or sold from its own inventory, the markdown or markup doesn't have to be disclosed)

  • The net amount, or the amount the customer paid or received after adding or subtracting the commission (if the investor purchased or sold bonds, the accrued interest is added or subtracted during this calculation)

About This Article

This article is from the book:

About the book authors:

Michael Griffis, MBA, has been an active trader for more than two decades. He has written about stock trading for online audiences, and today, writes about investing and marketing for clients in the banking and brokerage industries. Lita Epstein, MBA, enjoys helping people develop good financial, investing, and tax planning skills. She designs and teaches online courses and has written more than 40 books, including Bookkeeping For Dummies and Reading Financial Reports For Dummies. Christopher Cottier, BSc, MBA, is a senior investment advisor based in British Columbia. He was one of the first fee-based advisors in Canada. He has served as technical editor for several Dummies books.

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