How to understand the contract note?

A contract note is the legal record of all transactions through stockbrokers on stock exchanges, and it includes all the trades executed on a particular day. The contract notes for the trades are sent to the registered email on the trade date. The contract notes can also be downloaded from Console. To learn more, see How to download contract notes?

The format of the contract notes has changed from 1 August 2024, as per the circular (WEB). The first page of the contract note displays the broker and client's information, along with other details like trade date, settlement date, settlement number, etc.

The next page displays the segment (equity, derivatives), the securities' International Security Identification Number (ISIN), quantities, Weighted Average Price (WAP), and brokerage details in a tabular format.

Weighted Average Price (WAP) for trades in the equity segment

• The WAP for buy trades is calculated across exchanges using the following formula:
  WAP = (Total buy trade value for ISIN across exchanges) / (Total number of shares bought across exchanges)
  
  
• The WAP for sell trades is calculated across exchanges using the following formula:
  WAP = (Total sell trade value for ISIN across exchanges) / (Total number of shares sold across exchanges)

WAP for trades in the derivative segment

• The Weighted Average Price (WAP) for common contracts across exchanges is calculated using the following formula:
  WAP = (Total buy/sell trade value for common contract across exchanges) / (Total quantity bought/sold across exchanges)
  
  
• For other derivative contracts, the WAP is calculated as:
  WAP = (Total buy/sell trade value of contract) / (Total quantity bought/sold)

The next page displays the obligation details.

The following information is displayed on the obligation details page:

• Pay in/pay out obligations by the client are displayed in the first column. If the amount is enclosed in brackets, the amount is payable. If the amount is not in brackets, it is receivable.
• All the brokerages and taxes applicable, i.e., GST, STT, stamp duty, SEBI turnover fee, and exchange transaction tax, are displayed from the second column onwards. CGST and SGST of 9% each will be charged if the billing address is Karnataka, and IGST of 18% for other states.
• The net amount receivable or payable by the client is displayed in the last column. If the amount is enclosed in brackets, it is payable. If the amount is not in brackets, it is receivable.

Annexure A is attached on the next page of the contract note.

Annexure A includes the details of the trades taken for the day, such as:

• Order No column displays the exchange order number.
• Order time displays the timestamp of when the order was placed.
• Trade No displays the trade number on the exchange.
• Trade time displays the timestamp of when the order was successfully executed at the exchange.
• Security/Contract description column displays the stock or instrument for which the order is for.
• Buy(B)/Sell(S) mentions the transaction type.
• Exchange column displays the name of the exchange where the security is traded.
• Quantity column displays the traded quantity.
• Gross Rate/Trade Price Per unit (Rs) column displays the price at which the order was executed.
• Brokerage per Unit (Rs) displays the brokerage charged per unit.
• Net Rate per unit (Rs) column will be the same as the gross rate per unit, as brokerage charges are mentioned separately in the contract notes.
• Closing Rate per unit(only for Derivatives) (Rs) is applicable to carried-over derivative contracts and displays the price at which the contract is closed for the day.
• Net total (Before Levies) displays the total amount due to the client or from the client before brokerage and taxes.
• Remarks column will display the remarks if there are any.

Did you know?

• Other charges such as call and trade and DP charges, are not displayed on the contract note. However, they are displayed on the funds statement. To learn more, see How to view or download the funds statement? and What are call and trade charges?
• The Order no. and the Trade no. is displayed as  111111 or  222222 to indicate that the position is exchange settled. For physical settlement (delivery based), the order no. is 333333. The Order time is displayed as 15:40:00, and the Trade time as 00:00:00.
• The format of contract notes has been changed starting from August 1, 2024. As a result, the old format will be displayed if a client downloads a contract note dated prior to August 1. To learn more, see How to understand the old format of the contract note?