What are delivery and non-delivery trades in stock market terminology?
And how do they affect online trading?
Answers:
Your question is imprecise. You probably mean trades in which the stock certificate is delivered to the buyer, versus trades in which the stock certificate is kept in street name, that is, held by the broker with whom you have your trading account.
Most investors in stocks do not take delivery of their shares. Instead they keep their shares with the brokerage firm and receive a monthly statement of their account. The broker collects any dividends paid by the shares and credits them to the owner's account. When the investor wants to sell shares, there is no need to go through the complicated process of endorsing them, guaranteeing the endorsement and delivering them safely to the broker. Typically, on-line trading is not accomplished with delivery of shares. It would be a waste of time and would involve a high cost.
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