How to Read your Futures and Options Statement - Bell Potter ...
How to Read your Futures and Options Statement - Bell Potter ...
How to Read your Futures and Options Statement - Bell Potter ...
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how <strong>to</strong> read<br />
the futures<br />
& options<br />
statements.
HOW TO READ FUTURES & OPTIONS<br />
TRADING STATEMENTS<br />
This information has been prepared <strong>to</strong><br />
help you underst<strong>and</strong> <strong>your</strong> <strong>Futures</strong> <strong>and</strong><br />
<strong>Options</strong> Trading <strong>Statement</strong> (Tax Invoice).<br />
It should be read in conjunction with<br />
<strong>your</strong> trading statements.<br />
About <strong>your</strong> Trading <strong>Statement</strong>s<br />
If you have provided <strong>your</strong> email address,<br />
trading statements will be emailed when<br />
trading activity occurs. <strong>Statement</strong>s that<br />
are mailed use the st<strong>and</strong>ard Australia<br />
Post service, so please allow for delivery<br />
periods <strong>to</strong> <strong>your</strong> address location.<br />
We recommend that you subscribe <strong>to</strong> the<br />
email delivery service as this will enable<br />
you <strong>to</strong> receive statements overnight on<br />
the day of processing. Please ensure that<br />
you have provided <strong>your</strong> email address as<br />
part of the account information requested<br />
in the Account Opening Form if you wish<br />
<strong>to</strong> utilise this service.<br />
Please retain copies of <strong>your</strong> trading<br />
statements for tax purposes, as additional<br />
statements will incur a reproduction fee.<br />
Important<br />
It is important that clients read <strong>and</strong><br />
underst<strong>and</strong> the contents of issued<br />
documents <strong>and</strong> review the full contents<br />
of all statements issued <strong>and</strong> advise<br />
<strong>Bell</strong> Commodities of any discrepancies<br />
immediately. <strong>Bell</strong> Commodities<br />
representatives are available if you<br />
require assistance on receipt of <strong>your</strong> first<br />
trading statement.<br />
We recommend that clients maintain an<br />
order book of all instructions given <strong>to</strong> <strong>Bell</strong><br />
Commodities <strong>and</strong> verify that the contents<br />
of the statements are in accordance with<br />
the instructions given. In the event that<br />
you do not receive a statement via email<br />
or postal delivery, please contact <strong>your</strong><br />
<strong>Bell</strong> Commodities Adviser.<br />
Address<br />
Your postal address will appear at the<br />
<strong>to</strong>p of the statement. Please advise <strong>Bell</strong><br />
Commodities in writing immediately of<br />
any change of address.<br />
1. Date<br />
This is the processing date for the<br />
business contained on the statement.<br />
Please note that non-Sydney <strong>Futures</strong><br />
Exchange is processed one day after the<br />
trade date due <strong>to</strong> the time difference<br />
between Australia <strong>and</strong> other major<br />
international financial regions.<br />
2. Adviser<br />
Your adviser’s initials.<br />
3. Account<br />
The number assigned <strong>to</strong> <strong>your</strong> account.<br />
This should be quoted when placing<br />
all orders or making enquiries on <strong>your</strong><br />
account, <strong>to</strong>gether with the full account<br />
name. This is also the “agent reference”<br />
that must be quoted on all bank deposits<br />
of funds in<strong>to</strong> our segregated bank<br />
accounts. Please keep this account<br />
number confidential.<br />
In accordance with industry regulations,<br />
all client fund accounts are “Segregated<br />
Accounts” <strong>and</strong> this will show on <strong>your</strong><br />
statement.<br />
<strong>How</strong> <strong>to</strong> read the futures <strong>and</strong> options statements V110801<br />
3
HOW TO READ FUTURES & OPTIONS TRADING STATEMENTS<br />
Explanation of Trading <strong>Statement</strong><br />
Trades Confirmations<br />
A<br />
B<br />
C<br />
D<br />
E<br />
F<br />
G<br />
The Exchange the contract is traded on.<br />
Contract Description<br />
Transaction Reference<br />
Buy Contract<br />
Sell Contract<br />
Expiry Month (prompt date) for this contract.<br />
Option Type<br />
C = Call An agreement that gives an inves<strong>to</strong>r the right (but not the obligation) <strong>to</strong> buy a s<strong>to</strong>ck, bond, commodity, or other<br />
instrument at a specified price within a specific time period.<br />
P = Put An option contract giving the owner the right, but not the obligation, <strong>to</strong> sell a s<strong>to</strong>ck, bond, commodity or other<br />
instrument at a specified price within a specified time. This is the opposite of a call option, which gives the holder the<br />
right <strong>to</strong> buy.<br />
H<br />
Strike Price<br />
The price at which a put or call option can be exercised.<br />
I<br />
J<br />
K<br />
L<br />
M<br />
N<br />
Price = Traded Price<br />
The currency denomination of the futures or options contract.<br />
Date = Trade Date<br />
Expiry Date - The day on which an options or futures contract expires <strong>and</strong> is no longer valid.<br />
Premium - The income received by an inves<strong>to</strong>r who sells (or paid by the buyer)<br />
Commissions <strong>and</strong> GST on commission<br />
0 <strong>Futures</strong> trade as a result of an exercise or assignment of an option.<br />
Delivery <strong>and</strong> Cash Settlement<br />
P<br />
Q<br />
Details of opening (original) <strong>and</strong> closing (delivered) trades, including trade date, contract details, trade price <strong>and</strong> delivery<br />
(cash settled price) price.<br />
Realised profit <strong>and</strong> loss (excluding fees <strong>and</strong> associated charges) on delivered or cash settled contracts.<br />
Exercises<br />
R<br />
S<br />
T<br />
Option exercise, which includes trade date, market, contract, strike, Put or Call <strong>and</strong> exercised price.<br />
Premium value calculated by number of contracts * Tick size of contract * Traded price. Realised profit or loss excluding<br />
fee <strong>and</strong> associated charges.<br />
Commission change for exercised rights of the contract option as agreed <strong>to</strong> the client’s commission schedule.<br />
4
TAX INVOICE<br />
MR JOE CITIZEN<br />
1 THE STREET<br />
MELBOURNE VIC 3000<br />
K<br />
L<br />
o<br />
STATEMENT DATE: 24/06/11<br />
ACCOUNT NUMBER: SAMPLE<br />
ADVISOR:<br />
A B C D E F G H<br />
I j<br />
T R A D E S C O N F I R M A T I O N S<br />
THE FOLLOWING TRADES HAVE BEEN EXECUTED THIS DAY FOR YOUR ACCOUNT AND RISK.<br />
MARKET CONTRACT<br />
DATE NUMBER BUY SELL CONTRACT DESCRIPTION REFERENCE PRICE CCY DEBIT/CREDIT<br />
CBOT WHEAT future<br />
24-JUN-11 199 25 SEP 2011 7-590 USD<br />
24-JUN-11 200 10 SEP 2011 8-130 USD<br />
TOTAL 25 10 EX- 14-SEP-11 COMMISSION USD 119.35 DR<br />
CBOT SOYBEAN MEAL option<br />
24-JUN-11 214 5 AUG 2011 C 380.00 16.00 USD 8 000.00 DR<br />
TOTAL PREMIUM USD 8 000.00 DR<br />
TOTAL 5 EX- 22-JUL-11 COMMISSION USD 16.05 DR<br />
24-JUN-11 215 5 DEC 2011 C 400.00 11.00 USD 5 500.00 DR<br />
TOTAL PREMIUM USD 5 500.00 DR<br />
TOTAL 5 EX- 25-NOV-11 COMMISSION USD 16.05 DR<br />
COMEX GOLD future<br />
24-JUN-11 216 5 AUG 2011 EXERC 1500.00 USD<br />
TOTAL 5 EX- 29-AUG-11 COMMISSION USD 0.00 CR<br />
COMEX SILVER future<br />
24-JUN-11 208 5 DEC 2011 39.535 USD<br />
24-JUN-11 209 5 DEC 2011 40.205 USD<br />
24-JUN-11 210 10 DEC 2011 40.685 USD<br />
24-JUN-11 211 3 DEC 2011 41.440 USD<br />
24-JUN-11 212 2 DEC 2011 42.390 USD<br />
TOTAL 20 5 EX- 28-DEC-11 COMMISSION USD 140.00 DR<br />
COMEX GOLD option<br />
24-JUN-11 216 15 AUG 2011 C 1500.00 22.00 USD 33 000.00 DR<br />
TOTAL PREMIUM USD 33 000.00 DR<br />
TOTAL 15 EX- 26-JUL-11 COMMISSION USD 84.00 DR<br />
24-JUN-11 201 3 DEC 2011 C 1500.00 74.00 USD 22 200.00 DR<br />
TOTAL PREMIUM USD 22 200.00 DR<br />
TOTAL 3 EX- 22-NOV-11 COMMISSION USD 16.80 DR<br />
m<br />
N<br />
p<br />
D E L I V E R Y A N D C A S H S E T T L E M E N T S<br />
DATE NUMBER MARKET BUY SELL CONTRACT DESCRIPTION TRADE PRICE CCY DEBIT/CREDIT<br />
24-JUN-11 199 CBOT 8 WHEAT future SEP 11 7-590 USD 35 900.00 DR<br />
24-JUN-11 5167 CBOT 8 WHEAT future SEP 11 6-692<br />
TOTAL 8 8 EX- 14-SEP-11 P&L USD 35 900.00 DR<br />
COMMISSION USD<br />
0.00 CR<br />
q<br />
R<br />
E X E R C I S E S<br />
DATE TRADE NUMBER MARKET BUY SELL CONTRACT DESCRIPTION TRADE PRICE CCY DEBIT/CREDIT<br />
24-JUN-11 216 COMEX 5 GOLD option AUG 11 C 1500.00 22.00 USD 11 000.00 DR<br />
TOTAL 5 EX- 26-JUL-11 COMMISSION USD 0.00 CR<br />
S<br />
T<br />
<strong>How</strong> <strong>to</strong> read the futures <strong>and</strong> options statements V110801<br />
5
HOW TO READ FUTURES & OPTIONS TRADING STATEMENTS<br />
Explanation of Trading <strong>Statement</strong><br />
Purchase & Sale<br />
Part of the trading statement shows the closing out of the trade <strong>and</strong> the realised profit of loss (excluding fees <strong>and</strong> associated<br />
charges).<br />
T<br />
U<br />
Elimination or reduction of a current long or short position by entering in<strong>to</strong> an equal <strong>and</strong> opposite transaction of the<br />
same security which is also called an offset. Details of the opening <strong>and</strong> closing trades including trade date, details of<br />
contract, trade price.<br />
Realised Profit or Loss. This is calculated by number of lots, difference between open <strong>and</strong> closing prices * futures<br />
underlying contract. Refer Q.<br />
Open Position<br />
V Trade Details. Refer A - H,<br />
W<br />
Settlement Price – Closing market price from the previous business day. Closing market price from the previous<br />
business date. This price is used <strong>to</strong> calculate Y.<br />
X Currency product traded. Refer J.<br />
Y<br />
Z<br />
Debit/Credit unrealised P&L or mark <strong>to</strong> market. This is calculated Traded price – settlement price * number of lots *<br />
<strong>Futures</strong> contract tick size.<br />
Currency conversion value.<br />
Journal Entries<br />
Journal entries are generally manual cash postings. All payments are posted with a transaction date, value date, payment type,<br />
description, currency <strong>and</strong> credit or debit amounts.<br />
1. Interest posting. Interest is calculated daily <strong>and</strong> posted monthly.<br />
2. Payments – Funds received or paid <strong>to</strong> the client’s bank account. These payments can be posted across all currencies.<br />
Commissions – The amount of brokerage <strong>and</strong> GST (if applicable) charged in the currency of the contract that has been<br />
traded. (not shown)<br />
Currency conversion - The exchange rates (also known as the foreign-exchange rate, forex rate or FX rate) between two<br />
currencies specifies how much one currency is worth in terms of the other. It is the value of a foreign nation’s currency<br />
in terms of the home nation’s currency. The process by which the transaction currency is converted in<strong>to</strong> the currency of<br />
settlement or the currency of the issuer for the purpose of facilitating transaction authorization, clearing, <strong>and</strong> settlement<br />
reporting. (not shown)<br />
6
STATEMENT DATE: 24/06/11<br />
ACCOUNT NUMBER: SAMPLE<br />
ACCOUNT NAME: MR JOE CITIZEN<br />
ADVISOR:<br />
T<br />
P U R C H A S E & S A L E<br />
DATE TRADE NUMBER MARKET BUY SELL CONTRACT DESCRIPTION TRADE PRICE CCY DEBIT/CREDIT<br />
24-JUN-11 199 CBOT 10 WHEAT future SEP 11 7-590<br />
24-JUN-11 200 CBOT 10 WHEAT future SEP 11 8-130<br />
TOTAL 10 10 EX- 14-SEP-11 P&S USD 27 000.00 CR<br />
24-JUN-11 208 COMEX 5 SILVER future DEC 11 39.535<br />
24-JUN-11 211 COMEX 3 SILVER future DEC 11 41.440<br />
24-JUN-11 212 COMEX 2 SILVER future DEC 11 42.390<br />
TOTAL 5 5 EX- 28-DEC-11 P&S USD 57 125.00 CR<br />
v<br />
O P E N P O S I T I O N S<br />
DATE TRADE NUMBER MARKET LONG SHORT CONTRACT DESCRIPTION PRICE CCY DEBIT/CREDIT<br />
W<br />
X<br />
U<br />
Y<br />
24-JUN-11 199 CBOT 7 WHEAT future SEP 11 7-590 USD 31 412.50 DR<br />
TOTAL 7 EX 14-SEP-11 SETTLEMENT PRICE 6-692 USD 31 412.50 DR<br />
TOTAL IN COUNTERVALUE AUD 33 146.47 DR<br />
AVERAGE LONG 7.59000<br />
z<br />
24-JUN-11 214 CBOT 5 S-BEAN MEAL opt AUG 11 C 380.00 16.00 USD 750.00 CR<br />
TOTAL 5 EX 22-JUL-11 SETTLEMENT PRICE 1.50 USD 750.00 CR<br />
TOTAL IN COUNTERVALUE AUD 791.40 CR<br />
AVERAGE LONG 16.00000<br />
24-JUN-11 215 CBOT 5 S-BEAN MEAL opt DEC 11 C 400.00 11.00 USD 2 500.00 CR<br />
TOTAL 5 EX 25-NOV-11 SETTLEMENT PRICE 5.00 USD 2 500.00 CR<br />
TOTAL IN COUNTERVALUE AUD 2 638.00 CR<br />
AVERAGE LONG 11.00000<br />
24-JUN-11 216 COMEX 5 GOLD future AUG 11 1500.00 USD 10 250.00 CR<br />
TOTAL 5 EX 29-AUG-11 SETTLEMENT PRICE 1520.50 USD 10 250.00 CR<br />
TOTAL IN COUNTERVALUE AUD 10 815.80 CR<br />
AVERAGE LONG 1500.00000<br />
24-JUN-11 209 COMEX 5 SILVER future DEC 11 40.205 USD 129 325.00 DR<br />
24-JUN-11 210 COMEX 10 SILVER future DEC 11 40.685 USD 282 650.00 DR<br />
TOTAL 15 EX 28-DEC-11 SETTLEMENT PRICE 35.032 USD 411 975.00 DR<br />
TOTAL IN COUNTERVALUE AUD 434 716.02 DR<br />
AVERAGE LONG 40.52500<br />
24-JUN-11 216 COMEX 10 GOLD option AUG 11 C 1500.00 22.00 USD 37 400.00 CR<br />
TOTAL 10 EX 26-JUL-11 SETTLEMENT PRICE 37.40 USD 37 400.00 CR<br />
TOTAL IN COUNTERVALUE AUD 39 464.48 CR<br />
AVERAGE LONG 22.00000<br />
24-JUN-11 201 COMEX 3 GOLD option DEC 11 C 1500.00 74.00 USD 23 610.00 CR<br />
TOTAL 3 EX 22-NOV-11 SETTLEMENT PRICE 78.70 USD 23 610.00 CR<br />
TOTAL IN COUNTERVALUE AUD 24 913.27 CR<br />
AVERAGE LONG 74.00000<br />
J O U R N A L E N T R I E S<br />
DATE VALUE DATE PAYMENTS TYPE DESCRIPTION REG CC DEBIT/CREDIT<br />
1<br />
24-JUN-11 25-JUN-11 Interests Interests from 23/06/11 <strong>to</strong> 24/06/11 01 AUD 0.48 CR<br />
24-JUN-11 24-JUN-11 Payments RECEIVED FUNDS FROM CLIENT 01 AUD 5 000.00 CR<br />
TOTAL<br />
2<br />
01 AUD 5 000.48 CR<br />
24-JUN-11 24-JUN-11 Payments RECEIVED FUNDS FROM CLIENT 01 GBP 20 000.00 CR<br />
TOTAL 01 GBP 20 000.00 CR<br />
24-JUN-11 24-JUN-11 Payments RECEIVED FUNDS FROM CLIENT 01 USD 10 000.00 CR<br />
TOTAL 01 USD 10 000.00 CR<br />
2<br />
2<br />
<strong>How</strong> <strong>to</strong> read the futures <strong>and</strong> options statements V110801<br />
7
HOW TO READ FUTURES & OPTIONS TRADING STATEMENTS<br />
Explanation of FINANCIAL account summary<br />
The account summary outlines the financial aspects of the client account. The Summary is shown per currency <strong>and</strong> is then<br />
notionally converted <strong>to</strong> the base currency on <strong>your</strong> account.<br />
Account cash balance – physical cash held on the account as at close of business the previous day.<br />
Realised Profit <strong>and</strong> Loss - The <strong>to</strong>tal of all realised Profit <strong>and</strong> Loss including ‘Delivery <strong>and</strong> Cash Settlements’ (“P-Q”) <strong>and</strong><br />
‘Purchase <strong>and</strong> Sale Activity’ (“T-U”).<br />
Premium sub<strong>to</strong>tal of all option premium.<br />
Payment/Receipt – <strong>to</strong>tal of all funds received or paid <strong>to</strong> the client.<br />
Interest – Refer Jounral Entries 1.<br />
Commission – Total brokerage<br />
GST – Service Tax<br />
New Cash Balance – Total balance from all of the above.<br />
Total Equity - The value of the securities in the account, assuming that the account is liquidated at the current settlement price.<br />
Option Market Value – Unrealised Profit <strong>and</strong> Loss on current open option position.<br />
Net Liquidation Value – The sum of Total Equity <strong>and</strong> Option Market Value. If all of the positions were closed at settlement price,<br />
this would be the account balance (not including brokerage <strong>and</strong>/or GST.<br />
Initial Margin – The deposit requirement using the defined exchange calculation method that you have positions denominated in.<br />
Margin Default Excess: The excess or shortage of the overall account. If a debit you are required <strong>to</strong> pay in funds <strong>to</strong> cover the<br />
margin call, if a credit the funds are available <strong>to</strong> you.<br />
Open Trade Equity - The unrealised Profit <strong>and</strong> Loss on current open futures transactions.<br />
Total Equity - The sum of New Cash Balance <strong>and</strong> Open Trade Equity.<br />
8
STATEMENT DATE: 24/06/11<br />
ACCOUNT NUMBER: SAMPLE<br />
ACCOUNT NAME: MR JOE CITIZEN<br />
ADVISOR:<br />
Processed exchanges : COMEX,ASXD,SFE,CBOT<br />
Non-processed exchanges :<br />
Account Summary as of 24/06/11<br />
Seg. AUD Seg. GBP Seg. USD<br />
SPOT RATE 1.00000000 0.65830000 1.05520000<br />
ACCOUNT CASH BALANCE 0.00 CR 0.00 CR 0.00 CR<br />
REALIZED PROFIT/LOSS 0.00 CR 0.00 CR 48 225.00 CR<br />
PREMIUMS 0.00 CR 0.00 CR 68 700.00 DR<br />
PAYMENTS/RECEIPTS 5 000.00 CR 20 000.00 CR 10 000.00 CR<br />
INTERESTS 0.48 CR 0.00 CR 0.00 CR<br />
COMMISSIONS 0.00 CR 0.00 CR 392.25 DR<br />
GST 0.00 CR 0.00 CR 39.24 DR<br />
NEW CASH BALANCE 5 000.48 CR 20 000.00 CR 10 906.49 DR<br />
OPEN TRADE EQUITY 0.00 CR 0.00 CR 433 137.50 DR<br />
TOTAL EQUITY 5 000.48 CR 20 000.00 CR 444 043.99 DR<br />
OPTION MARKET VALUE 0.00 CR 0.00 CR 64 260.00 CR<br />
NET LIQUIDATING VALUE 5 000.48 CR 20 000.00 CR 379 783.99 DR<br />
INITIAL MARGIN 0.00 CR 0.00 CR 385 424.00 DR<br />
MARGIN DEFAULT/EXCESS 5 000.48 CR 20 000.00 CR 829 467.99 DR<br />
BASE CURRENCY AUD<br />
SPOT RATE 1.00000000<br />
ACCOUNT CASH BALANCE<br />
0.00 CR<br />
REALIZED PROFIT/LOSS<br />
50 887.02 CR<br />
PREMIUMS 72 492.24 DR<br />
PAYMENTS/RECEIPTS 28 718.00 CR<br />
INTERESTS 0.48 CR<br />
COMMISSIONS 413.90 DR<br />
GST 41.41 DR<br />
NEW CASH BALANCE 6 657.95 CR<br />
OPEN TRADE EQUITY 457 046.69 DR<br />
TOTAL EQUITY 450 388.74 DR<br />
OPTION MARKET VALUE 67 807.15 CR<br />
NET LIQUIDATING VALUE 382 581.59 DR<br />
INITIAL MARGIN 406 699.40 DR<br />
MARGIN DEFAULT/EXCESS 857 088.14 DR<br />
>><br />
<strong>How</strong> <strong>to</strong> read the futures <strong>and</strong> options statements V110801<br />
9
LIST OF EXCHANGES<br />
Australian Securities Exchange (ASX) <strong>and</strong> ASX 24<br />
Chicago Mercantile Exchange (CME)<br />
Chicago Board of Trade (CBOT)<br />
New York Board of Trade (NYBOT)<br />
Chicago Board of <strong>Options</strong> Exchange (CBOE)<br />
Philadelphia S<strong>to</strong>ck Exchange (PHLX)<br />
New York Mercantile Exchange (NYMEX)<br />
Kansas City Board of Trade (KCBT)<br />
Minneapolis Grain Exchange (MGE)<br />
Montreal Exchange (ME)<br />
Winnipeg Commodity Exchange (WCE)<br />
Euronext<br />
Eurex<br />
London International Financial <strong>Futures</strong> Exchange (LIFFE)<br />
London Metal Exchange (LME)<br />
International Petroleum Exchange (IPE)<br />
Singapore Exchange (SGX)<br />
Hong Kong Exchange (HKEX)<br />
Tokyo International Financial <strong>Futures</strong> Exchange<br />
www.asx.com.au<br />
www.cme.com<br />
www.cbot.com<br />
www.nybot.com<br />
www.cboe.com<br />
www.phlx.com<br />
www.nymex.com<br />
www.kcbt.com<br />
www.mgex.com<br />
www.me.org<br />
www.wce.ca<br />
www.euronext.com<br />
www.eurexchange.com<br />
www.liffe.com<br />
www.lme.co.uk<br />
www.theice.com<br />
www.sgx.com<br />
www.sehk.com.hk<br />
www.tfx.co.jp<br />
10
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<strong>How</strong> <strong>to</strong> read the futures <strong>and</strong> options statements V110801<br />
11
<strong>Bell</strong> Commodities GPO Box 4718,<br />
Melbourne VIC 3001,<br />
Australia<br />
Toll Free 1800 672 405<br />
Fax 03 9256 8787<br />
www.bellpotter.com.au<br />
<strong>Bell</strong> <strong>Potter</strong> Securities Limited<br />
ABN 25 006 390 772<br />
AFS Licence No. 243480