Deal Ticket

In Chicago, there’s a bar in the shadow of the Chicago Mercantile Exchange. Its name is Cactus, and its motto is "Don't Drink and Trade."

That’s a good lesson in life.

If you’ve ever had too much to drink, and you check your credit card, you might see a big tab. So you call up the bar, and you ask for an itemized list of everything you drank.

You don't believe that you had a Mai Tai, two shots of Jaeger, 12 Bud Lights, and some Absinthe out of a crystal skull. But there it all is...itemized. And they have a copy of a receipt that you signed.

The stock market is a lot like a bar. You make mistakes. There are no takebacks, and there’s always evidence that you executed a deal.

That’s why, like a bar tab, a Deal Ticket exists.

The deal ticket, also called a trading ticket, keeps full tabs of the asset traded, volumes, prices, and dates and times of the deal. Trading houses and brokerages, which execute a lot of deals, will keep these deal tickets in a massive transaction log.

The deal tickets also provide information on related commissions, the order type, the order duration, and the type of transaction (whether it was a buy, sell, short, or buy to close).

That way, when you wake up in the morning and ice your head from a long day of trading, you’ll have a solid piece of evidence.