Execution Reports and Trade Confirmations

Between clicking buy and seeing a position in your account, several messages pass between your platform, your broker and the trading venue. Each one tells you something about your order: that it was received, whether it was filled and at what price, and finally the official record of the trade. Knowing what these messages mean helps you catch errors, check execution quality and keep proper records.

The messages in an order's life#

Professional systems exchange these messages using standard formats such as the FIX protocol. See FIX Protocol.

Order acknowledgments and rejections#

An acknowledgment confirms your order is live. A rejection tells you it never reached the market. Common rejection reasons include insufficient buying power, a price too far from the market, a closed or halted symbol, an unsupported order type for the session, and size above a limit. If you do not see an acknowledgment, do not assume the order is working.

Execution reports and partial fills#

Each fill produces an execution report with the quantity, price, time and often the venue.

The trade confirmation#

The trade confirmation is the formal record your broker must send after a trade. In the United States, broker-dealers are required to provide one at or before completion of the transaction. It typically includes:

• trade date and settlement date,
• security, quantity and price,
• whether the broker acted as agent or principal,
• commissions and fees,
• total amount due or received.

Many brokers deliver confirmations electronically. Keep them; they are part of your tax and trading records. See Record Keeping for Traders.

Using these records to check execution#

Execution reports let you measure how well your orders are filled:

1. Compare your fill prices with the quote at the time you sent the order to estimate Slippage.
2. Note the venue and any price improvement.
3. Check fees on confirmations against your broker's schedule.
4. Track fills in your Trading Journal so your recorded entries match reality.

When something looks wrong#

• Unexpected fill price: check the time and the market's prices at that moment. Fast markets and gaps explain most surprises.
• Missing fill: check whether the order was acknowledged, rejected or cancelled.
• Duplicate fill: contact your broker immediately; erroneous trades are easier to correct quickly.
• Clearly erroneous trades: exchanges have rules to cancel or adjust trades at obviously wrong prices, usually only if reported promptly.

Frequently asked questions#

What is an execution report?#

A message from your broker or the trading venue confirming that all or part of your order has been filled, with quantity and price.

What is the difference between an execution report and a trade confirmation?#

Execution reports arrive in real time as orders fill. The trade confirmation is the formal record of the completed trade, including fees and settlement details.

How long should I keep trade confirmations?#

Keep them with your tax records for as long as your local tax rules require, often several years.

Sources#

• U.S. Securities and Exchange Commission, Trade confirmations