Contract note

Introduction

This article aims to demonstrate the importance of contract notes and their role in trading. It is crucial to learn how to read a Contract Note. This document contains all information about trades that were made on a particular day.

What is a Contract Note?

Contract notes are records of all trades that were successful on a given day. It is legal proof that a particular individual's transactions are documented.

These components make up each contract note:

• - Order and Trade Number
• - Order & Trade Time
• - Name and symbol of securities traded
• - Buy or sell - Action Carried out
• - Types of trade: Intraday or Delivery
• - Quantity and price of the trade
• - Brokerage & Other Statutory Fees -
• - Net Amount Received / Payable

What purpose do contract notes serve?

• It is used to confirm trades made by investors on a particular day
• You can find the total brokerage cost here
• - The net amount payable/received is shown.

Contract Notes - Examined with a fine-toothed comb!

Look at the meanings of each column.

Order No :

This column shows the unique numbers that Exchanges assign to certain Orders or Trades.

Order Time :

This page highlights the exact moment that an investor placed an Order on the Exchange.

Trade Time :

This column includes the time an investor's trade was executed successfully on the Exchange.

Example: Let's say that the current price for Reliance Equity (Last traded price) is Rs 2,000. At 10:01:05 AM, you placed a Buy order (Limit price) for Rs 1,995. Your order was successfully executed at 10:30:27 AM. Your Trade Time is 10:30:27 am

Securities/Contract Description :

This refers to the stock/contract name that was traded.

Simple - This refers to the type order that an investor has placed.

Quantity :

This is the stock that an investor trades in. Negative (-) numbers are for Sell Orders.

Gross Rate per Unit:

This rate shows the price at which an investor's order was executed on Exchange.

Brokerage per Unit:

Brokerage is charged for each trade listed in Table 2 - Order specific details

Net Rate per Unit:

Because brokerage charges are separately mentioned, the Net Rate per unit is equal to the Gross Rate per unit.

Closing Rate per Unit:

This rate is only applicable to derivative trades. It represents the closing price of a particular contract for the day.

Net Total before Levies :

This is the amount before any additional charges are added.

• A positive (+) number is an indication of an amount that you are entitled to.
• - A negative amount (-) is an indication of an Amount Payable to You.

The 1 st Table provides detailed information, but the next table Orderwise Details is designed to give you a quick summary of your trades and the brokerage.

The last table lists the levies and taxes that have been charged. Let's have a look at these.

Exchange :

This column contains information about the Exchange and segments that have been traded.

Example - Capital : The Exchange refers to NSE, while Capital refers the Equity Segment

Pay In/Pay out Obligation :

This is the net total before brokerage (Table 1) and net total before Levies (Table 2).

• - A positive (+ sign) is an indication of an amount that you are entitled to.
• A negative amount (-) is an indication of an Amount Payable to You.

Securities Transaction Tax, (STT),:

This is the direct tax that the broker collects from every trade on the Exchange and pays to the Exchange. STT can be levied on buying and selling equity delivery as well as on intraday and F&O sales.

Taxable Value of Supply = Total brokerage + exchange transaction charges + SEBI Turnover fees.

• Total Brokerage - Total Brokerage as per your Brokerage plan
• Exchange Transaction Fees - These fees are charged by Exchanges such as the NSE and MCX to enable trading.
• SEBI Turnover fees - To regulate the market, the Securities and Exchange Board of India(SEBI) charges fees for securities transactions.

Central GST

State GST

If you're from Maharashtra, CGST+ SGST will be charged. The rest of the country will be subject to IGST (Interstate GST)/UGST(Union Territory GST).

Stamp Duty :

This is a Government Levy that applies to the transfer of securities such as shares, debentures and futures and options.

Auction/ Other Fees :

If applicable, these charges will be levied on you.

More information on Charges & Levies – Please visit our Transaction Charges page.

Net Amount Received by Client / (Payable to Client) :

After all levies, charges and taxes, the Net Total.

• Amount Received by You is indicated by a positive (+) number
• - A negative amount (-) is an indication of an Amount Payable to You

If you need to find Charges related to DP, Auto Square-Off and Call-n-Trade as well as Delayed Payment, MTF Interest or AMC Fees, refer to your Ledger Report.

Contract notes give investors a summary and overview of trades they made on a specific day. These trades are accompanied by an overview of their losses and profits. Electronic contract notes can be downloaded with a digital signature.

Contact us for any additional assistance .