NISM Certifications · NISM-Series-VII: Securities Operations and Risk Management · Market Participants in the Securities Market
Ramesh Securities, a stockbroker, receives a client's order and executes it. Which document must the broker issue to the client after execution to confirm the trade details, including the trade number, time and price, within the prescribed time?
The broker must issue a contract note to the client after the trade is executed. It is the formal confirmation of the transaction and records the order and trade numbers, times, quantity, price and brokerage. Delivery slips, margin statements and pay-in advices serve different operational purposes.
- AContract noteCorrect
- BDelivery instruction slip
- CMargin statement
- DPay-in advice
Explanation
The broker issues a contract note as the legal confirmation of the executed trade, showing the order and trade numbers, times, quantity, price and brokerage. The other documents relate to delivery, margins or settlement funds and do not confirm the trade.
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