Afternoon D & C Dedicated To Mumbai
Home > Business & Investment > What is a Contract Note and why is it important?

What is a Contract Note and why is it important?

Monday, June 10, 2019

The Contract Note as a concept originated when electronic trading did not exist. Back then, investors would personally contact their brokers to place orders for stocks and bonds. The brokers would then execute the trade and send a confirmation of the price to the investor. The contract note was used as a de-facto reference point for investors to see their trades and the price at which they were made.

Times have changed now, investors can now see their trades being executed in real time with Exchange Order Numbers and time stamps. With trading going online, investors get the Contract Note via email, and physical copy on the same day () as the processing time is reduced and the note is system generated.

The function of a Contract Note still remains the same. It is still the legal record of any transaction carried out on a stock exchange through a stockbroker and it still serves as the confirmation of trade done on a particular day on behalf of an investor on a stock exchanges.

It is a receipt that the broker issues to the investor, informing or confirming the trade with complete details of the transaction in a prescribed format by Stock exchanges.

A valid Contract Note has the following details in a structured format:

  • SEBI registration number of the Trading Member / Sub-broker
  • Details of trades: Order number, Trade number, Trade price, Trade execution time, Traded security and quantity, Brokerage charged, Details of other service charges
  • Signature of Authorized Signatory or Digital Signature in Electronic format
  • Bylaws and regulations pertaining to Arbitration

How do you acquire a Contract Note?
There are two ways to acquire a Contract Note:

Online: Your Contract Note will be mailed to your email account in electronic format automatically after making your transaction.

Offline: Your broker/trading member will send your Contract Note to delivered to the registered address.

MSE IPF Blog: An Investor Education Initiative by MSE Investor Protection Fund

No Comments Posted
City news
Focus on Agriculture, Jobs, Infrastructure and Di
Under flak for scrapping internal assessment mark
In an interesting case, the Communist Party of ...
I am really very uneasy and disturbed. I started
Dr. Rajan B. Bhonsle, M.D. (Bom)
Consulting Sex Therapist & Counsellor
Dr. (Mrs.) Minnu R. Bhonsle, Ph.D.
Consulting Psychotherapist & Counsellor
Select Sun sign:
Aries (Mar 21 - Apr 20)
Aries (Mar 21 - Apr 20)You are likely to remain careful and watchful today, foretells Ganesha. And because you'll be invited to parties and other social events, your enthusiasm will remain buoyant. You will also strike the right balance between business and pleasure, says Ganesha.
- Advertising -
Recently, Madurai High Court Bench expressed alar
The development of transportation and telecommuni
A national campaign to touch-base with 50,000 rur
Read More