Execution puts the
confirmation
process in motion.
The
trade is reported on the market's
ticker
tape.
Your broker and the broker on the other side
of the transaction are notified electronically that the deal is
done, and the price at which the stock traded.
The details are entered in each
clearing
firm's
processing system.
Your confirmation
If you placed your order online, you may receive an email informing
you that you've bought or sold. Or your broker may call you.
Whether or not you hear immediately, you'll receive a written
confirmation with all of the details of the transaction, including
a unique trade identification number. The confirmation document
reports the stock's name and security identifier —
known as the
CUSIP
number — the number of shares traded, the price, the commission,
the fees, the trade and settlement dates.
The CUSIP number, issued by the Committee
on Uniform Securities Identification Procedures, is a 9-character
combination of letters and numbers that identifies the security
and helps facilitate the next steps in the transaction process:
clearing and settlement.
Keep it for your records
Your trade confirmations are also important tax documents. Confirmation of purchase is a record of your
cost
basis,
and confirmation of sale is a record of your
capital gain
or loss. You'll want to hold onto purchase records as long as you hold the stock and, if you sell, make the matched pair part of your permanent tax files.
The
trade is reported on the market's
