Understanding Brokerage Statements: A Comprehensive Guide

A broker's statement is a monthly snapshot of a brokerage account activity. Since account information is available online, monthly statements can seem redundant, but they represent an official record. Investors can choose to receive a paper statement in the mail or an electronic statement online.

Account Summary

A statement provides a quick summary view of an account: total account balance with a monthly increase or decrease; major positions: cash, investments; deposits and withdrawals; dividend and interest income; account fees and charges; transfers; realized and unrealized gains and losses. A statement may contain an account's asset allocation -- cash, fixed income, equities and other assets such as commodity funds -- in a list or pie chart format; and margin information: margin balance, available margin, margin interest rates and charges.

Account Detail

Account detail lists specific positions by asset category with current market values and all account transactions in chronological order (deposits, withdrawals, buys, sells), with long and short positions listed separately.

Money Market Fund Detail

A brokerage account may be linked to a money market account where all uninvested cash is swept automatically. An investor can access the money market fund by check, debit card, or via buys and sells in the brokerage account. It may be confusing to reconcile the money market activity with the brokerage account activity. When an investor deposits cash in his brokerage account, it is shown in the brokerage account detail as a deposit. If the cash is not used right away to pay for an investment purchase, the cash is swept into the money market account, so the brokerage account detail will show a withdrawal to purchase money market shares and the money market fund detail will show a purchase.

Other Information

In addition to the legally-required disclaimers, a statement lists customer account phone numbers in case you have any questions or need assistance. As broker software becomes more sophisticated, account statements may add new features to make it easier for investors to visualize and analyze account activities and investment results.