Cancellation
A notice informing a customer of the cancellation of an erroneous trade that has been credited to his or her account by the broker. Investopedia Says:
Even stock brokers are subject to human error. When an error is made, set guidelines must be followed to rectify the situation.
For example, if a broker mistakenly over-purchases 100 shares of Cory's Tequila Corporation for your account, he or she must sell the 100 shares and bear any losses in his or her internal account. Each transaction is properly recorded and you will be sent statements showing the changes to your account. The procedure is done to ensure that the broker is not improperly trading for your account. Related Terms:
90 Day Letter
Bank Reconciliation Statement
Broker
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