Contract Note
Contract Note
- Definition: A Contract Note is a legal document and evidence of the trade done by the stock broker, containing details of the transaction such as securities bought/sold, traded price, time of trade, brokerage, etc.
- Details: Contract Notes can be issued in physical or electronic form, with electronic contract notes requiring specific authorization and being digitally signed and encrypted to prevent tampering.
Importance of Contract Note
- Preservation: Investors should preserve Contract Notes for future references, especially in case of disputes.
- Dispute Resolution: Contract Notes play a crucial role in resolving disputes that may arise later.
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Key Considerations
- Timely Issuance: Contract Notes should be issued by the stock broker within 24 hours of the execution of the trade.
- Discrepancy: In case of any discrepancy in the Contract Note, investors should immediately take up the matter with the stock broker.
- Record Keeping: Investors should cross-check their records with the details mentioned in the Contract Note and contact their broker in case of any discrepancy.
Record of Client Order
- Evidence: Stock brokers must keep evidence of client orders, which can be in the form of:
- Physical record written and signed by client
- Telephone recording
- Email from authorized email ID
- Log for internet transactions
- Record of messages through mobile phones
- Any other legally verifiable record.