Since the onset of the pandemic, the number of retail investors has seen a huge rise. Thus possibilities of conflicts are also increasing day by day. The Securities Exchange Board of India (SEBI) has taken a lot of measures to safeguard the interests of retail investors. One of these is done by issuing contract notes, showing the price, brokerage, GST, and securities transaction tax (STT) in the prescribed format.
Contract notes are easily one of the most relevant legal documents available to investors and traders in the stock market. It shows in detail all transactions which took place in a day in one place, along with profit and loss information. It is a legal record of any of the trades made by a trader on a stock exchange. It records and confirms the trades taken place on a particular day, performed on a stock exchange (BSE or NSE). This document is sent to the trader by the broker, listing out the details of the shares bought and sold through them. This document is generally available in an electronic form.
A contract note gives traders and investors a basic description of the trades they have taken, along with the date, period, lot size, or quantity traded. It also gives the trader a reference number with which they can cross-reference their transactions with the stock exchange.
Sample of a contract note issued by TradeSmart
As there has recently been a huge increase in the number of participants in the stock market, the odds of disputes are also rising at a similarly increasing rate as days go by. SEBI has taken a few steps to shield the retail investors. One of the first actual steps on this course is the digital contract note in the prescribed format showing Price, Brokerage, GST, STT etc. By perusing this report thoroughly, an investor can be confident that the order he has placed with his broker has been executed correctly. This report is a prerequisite for submitting a grievance against your broker, you must always insist on regular delivery of contract notes from your broker.
Just by glancing at this report, an investor can be assured that the order he executed through his brokerage was carried out efficiently. Contract Notes can act as a ready reference in case of doubt with reference to any transactions as you can guarantee the genuineness of the same on the BSE/NSE website. The most common use of a contract note is:
In summation, contract notes offer investors a summary of their trades taken on a specific day. Additionally to those trades, they’re given an overview of their profits or losses. Contract notes are provided in an electronic format with a digital signature of the authorized signatory of the brokerage firm.
A Contract Note is a brief written statement of trades taken by a trader during a particular period. It is issued by a trader’s broker so that the trades can be easily verified.
A Contract Note is issued to the investor / trader by the broker denoting all trades done during the course of a day. It acts as the evidence of the trades done by the investor / trader. They are regulated by the directions of the Securities and Exchange Board of India (SEBI).
Contract Notes are one of the most essential legal documents available to investors and traders in the stock market. It contains all the details of the trader’s transactions in one place, along with the profit and loss details.
A trader can ask their respective broker to send it to them in case they are not already receiving them. If your email id is registered with the broker, it will be delivered to you via email.
Please note that by submitting the above mentioned details, you are authorizing TradeSmart to call and email you and also to send promotional communication even though the contact number may be registered under DND.
Please note that by submitting the above mentioned details, you are authorizing TradeSmart to call and email you and also to send promotional communication even though the contact number may be registered under DND.
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Please note that by submitting the above mentioned details, you are authorizing TradeSmart to call and email you and also to send promotional communication even though the contact number may be registered under DND.