Quick Answer
Every order ticket needs two time stamps (receipt and execution), the short-sale indicator required by Regulation SHO, and a solicited-versus-unsolicited designation that determines whether the full Reg BI suitability obligation applies. The ticket is the audit trail regulators use to detect trading ahead of a customer order.
Missing or incomplete order-ticket elements are some of the most commonly tested details in this unit, precisely because they're easy to overlook.
Information Required on an Order Ticket
Every customer order must be documented on an order ticket at the time the order is received. Required elements include:
| Element | Description |
|---|---|
| Security symbol/description | Identifies the security being traded |
| Account number | Customer account identifier |
| Buy or sell | Direction of the order |
| Number of shares or units | Quantity |
| Price instructions | Market, limit price, stop price, or other modifier |
| Order type/qualifications | All-or-None (AON), Fill-or-Kill (FOK), Immediate-or-Cancel (IOC), Good-Till-Canceled (GTC), day, not held, etc. |
| Time of order receipt | When the order was received from the customer |
| Time of execution | When the order was filled |
| Execution price | Price at which the order was executed |
| Registered representative | Identity of the rep who entered the order |
| Solicited or unsolicited | Whether the trade was recommended by the firm or initiated by the customer |
| Discretionary indicator | Whether the rep exercised discretion |
| Short sale indicator | Whether the sale is a short sale (required by Regulation SHO order-marking rules) |
Time-Stamping Requirements
- Order tickets must be time-stamped at two points:
- Time of receipt: when the order was received from the customer
- Time of execution: when the order was filled
- This creates an audit trail for regulatory review and best execution analysis
- Ensures compliance with order handling rules and helps detect trading ahead of a customer order (a firm or rep trading for its own account between the receipt and execution of a customer's order)
Exam Tip: Gotchas
- Order tickets require two time stamps: time of receipt AND time of execution. The exam may present options with only one; both are required.
- The short sale indicator is required by Regulation SHO (Short Sale Regulation). This is a frequently tested detail that students overlook.
The Solicited vs. Unsolicited Distinction
This designation has real regulatory consequences:
- Solicited (recommended by the rep): The firm has a full suitability obligation under Reg BI (Regulation Best Interest)
- Unsolicited (customer-initiated): The obligation is reduced but not eliminated; the firm still cannot execute clearly unsuitable trades
Exam Tip: Gotchas
- The solicited vs. unsolicited designation is a required order ticket element. If a trade was recommended by the rep, the firm has heightened suitability obligations under Reg BI.
- Unsolicited does not mean "anything goes." The firm still cannot execute clearly unsuitable trades, even when the customer initiated the order.
What Should You Check on Exam Day?
- Can you name all required order-ticket elements, including the short-sale indicator and both time stamps?
- Do you know the difference in suitability obligation between a solicited and an unsolicited order?
- Can you explain how time-stamping helps detect trading ahead of a customer order?