What Should You Check in Your Trading Contract Note?

After placing a trade, most investors check their positions, account balance, or profit and loss. The contract note often remains unopened in their inbox. However, reviewing this document is an important part of managing a trading account responsibly.

A trading contract note helps you verify what was executed, at what price, and with which charges. Reading it regularly can help you identify unfamiliar transactions, understand trading costs, and maintain accurate records.

Whether you trade occasionally or use automated strategies, the checks below will help you review your contract note with greater confidence.

What Is a Trading Contract Note?

A contract note is a formal document issued by your stock broker recording trades executed on your behalf. It provides evidence of the transactions and includes information about the securities or contracts traded, quantities, execution prices, and applicable charges.

It serves a different purpose from an order confirmation. An order confirmation indicates that an instruction was submitted or accepted; a contract note records executed trades.

SEBI’s investor guidance advises investors to insist on a valid contract note or confirmation memo within 24 hours of the transaction. If yours is missing, check your registered email, spam folder, and broker’s document portal, then contact the broker.

Confirm Your Personal and Trading Account Details

Start by checking your name, client code, unique client code, and PAN wherever displayed. These should match your account records.

This is particularly useful if you manage multiple accounts or receive several trading-related emails. Make sure you are reviewing the correct account before comparing quantities or charges.

If any identifying information is incorrect, request clarification and correction through the broker’s official support channel. Keep the original document and the correspondence so you have a clear record of the issue.

Verify the Broker’s Identity and Document Authenticity

Check the broker’s legal name, registration, and exchange membership details, along with the contract note number and contact information.

For an electronic contract note, review the digital signature information. SEBI has recognized digitally signed electronic contract notes as legal documents in the equity derivatives segment.

Access documents through your registered email or the broker’s official portal. If an attachment or sender looks unfamiliar, verify it independently with the broker before entering account information.

Save the complete original file, including its annexures. A screenshot of the first page may leave out information you need later.

Check the Trade Date and Settlement References

The trade date should match the day your transactions were executed. The date an email arrives can differ from the trade date, so compare the document with your trading history.

Review settlement references wherever provided, especially when reconciling several days of activity.

Execution and settlement are separate stages. A contract note records trading activity; it does not, by itself, confirm that securities have reached your demat account or that funds have arrived in your bank account.

For delivery transactions, review the corresponding demat entries and account statements as part of your reconciliation.

Match the Security or Derivative Contract

A familiar stock or index name is only the starting point. Compare the full instrument description against your trade book.

For equity trades, review the security name, symbol, series, and ISIN wherever available. For derivatives, check the underlying, expiry date, strike price, and option type, as applicable.

Two options can have the same underlying and strike but different expiries. A call and a put are also different contracts.

For a multi-leg strategy, review every executed leg individually. Checking only the overall strategy label can conceal a mismatch in one component.

Verify Buy or Sell and Executed Quantity

Confirm that every transaction has the correct buy or sell direction. Then compare executed quantities with your trade book.

The quantity you requested may differ from the quantity executed. For example, if you placed an order for 100 shares but only 60 were filled, reconcile the contract note against those 60 executed shares.

For derivatives, distinguish between lots and units. Use the lot size applicable to that particular contract and trade date.

Also investigate unfamiliar transactions. Before concluding that a trade was unauthorised, check whether it resulted from an approved strategy, stop-loss execution, or broker square-off under the applicable terms.

Review the Execution Price and Average Price

Compare the price on your contract note with the actual execution records. Your intended entry price, the last traded price and your execution price can differ.

An order may receive several fills at different prices. Consider this hypothetical equity purchase:

The weighted average is the total trade value divided by the total executed quantity. Here, ₹50,120 divided by 100 equals ₹501.20, before charges.

NSE’s revised-format guidance provides for a single weighted average price across exchanges for the same security or common contract. An average price on the summary therefore needs to be checked against the underlying executions.

Read the Trade Annexure.

Do not finish your review at the summary page. NSE specifies that the contract note should include an annexure containing individual trade information, including exchange, order number and time, trade number and time, quantity and price.

Use these references to investigate a particular execution. One order can generate multiple trades, so several trade entries do not automatically indicate duplicate orders.

For automated trading, compare the annexure with your broker’s trade book and strategy logs. A strategy signal alone does not prove execution. Match it to an executed trade before treating it as a completed transaction.

Check Brokerage Against Your Agreed Plan

Review brokerage separately from the execution price. SEBI has emphasized that transaction price and brokerage should be shown separately to support transparency.

Compare the amount with the tariff you accepted. Your plan may use a percentage, a flat fee, a cap, or different charges for different segments.

For example, do not assume that a charge advertised for online equity orders also applies to call-and-trade orders or broker-assisted square-offs.

If the amount appears incorrect, ask the broker to explain the calculation, applicable tariff, and treatment of multiple fills. Avoid comparing the charge with an unrelated plan or an outdated promotional offer.

Understand Taxes and Other Charges

The total cost of trading includes more than brokerage. Depending on the instrument and transaction, review applicable exchange charges, regulatory fees, Securities Transaction Tax, Goods and Services Tax, and stamp duty.

Different taxes have different calculation bases and buy-side or sell-side treatment. NSE publishes guidance on these levies, including rates effective from specific dates. Use the rules applicable on your trade date when checking a calculation.

Ask for a breakdown if a charge is unclear. A label such as “taxes” or “other charges” should not prevent you from understanding the amount.

Also review separately billed services through the relevant tariff and ledger. Do not assume the contract note contains every expense associated with your account.

Reconcile the Net Amount with Your Ledger

After reviewing individual trades and charges, check the net amount payable or receivable.

For a straightforward equity purchase, the debit generally reflects purchase value plus applicable charges. For a sale, the credit generally reflects sale value less applicable charges.

Mixed buy-and-sell activity and derivatives require closer reconciliation. A futures contract’s traded value, for example, should not be treated like the cash payment for an equity delivery purchase.

Compare the contract note with the corresponding ledger entries. Your available balance may also reflect earlier balances, margins, withdrawals or other debits, so it may not equal the contract note total.

What Should You Do If You Find a Discrepancy?

Raise the issue promptly through the broker’s official support or grievance channel. Include your client code, trade date, contract note number, relevant order or trade references, and a clear explanation of the mismatch.

Attach the supporting trade-book records and preserve the complaint acknowledgement. Request a written explanation and, where an error is confirmed, the appropriate correction.

SEBI’s guidance says investors should first approach the concerned intermediary. If the complaint remains unresolved or the response is unsatisfactory, use the applicable exchange grievance process or SEBI’s SCORES mechanism.

Make Contract Note Reviews a Regular Habit

A consistent review is easier than reconstructing months of transactions later. After each trading day, check account details, instruments, quantities, prices, brokerage, and charges. Compare exchange trade alerts with your records, and retain contract notes alongside ledger and demat statements.

SEBI encourages investors to maintain transaction records and regularly check exchange communications and their trading accounts. These habits support clearer cost tracking and faster investigation when something does not match.

Lares Algotech, a SEBI-registered stockbroker and member of NSE, BSE, and MCX, encourages informed market participation. When reviewing your Lares Algotech trading contract note, compare it with your trade book and agreed tariff, and contact the official support team whenever an entry needs clarification. Understanding your trading records is an essential part of responsible market participation.