Digitized by the Internet Archive in 2017 with funding from Duke University Libraries https://archive.org/details/wallstreet01hodg WALL STREET By Charles F. Hodges WALL STREET A practical text on the work of all departments of the brokerage house, with information for investors and traders. Part I covers the methods, routines, bookkeeping and accounting practices of the Cash- ier’s Cage, the Bookkeeping, Margin, Stock Record, Dividend and Transfer Departments; the Clearing House, the Order, Trading, Statistical and Runners Departments; the Method of Making a Brokerage House Audit, and a Glossary of Terms :nd Defini- tions. Part II — What Investors Should Know. By CHARLES F. HODGES Published by the Wall Street Business School New York Copyright, 1930, by The Wall Street Business School 5 / / 6 / ^ ^ 3- £ + 1 . CONTENTS v Part I Chapter 1 The New York Stock Exchange 11 2 Order Department 39 3 Clearing House Department 51 4 Margin Department 89 5 Bookkeeping Department 109 6 Stock and Bond Record Department 143 7 Dividend and Coupon Department 157 8 Cashier’s Department 177 9 Transfer Department 233 10 Unlisted Trading Department 243 11 Statistical Department 251 12 The Method of Auditing a Stock Brokerage Firm 287 13 Runners Department 301 Part 2 What Investors Should Know 311 Terms and Definitions 347 Symbols New York Stock Exchange 387 Symbols New York Curb Exchange 429 299044 5 FOREWORD The constantly increasing numbers of those who have become investors in the securities of the nation’s industries in recent years has created a growing interest on the part of the invest- ing public in matters pertaining to investments, in the work of Wall Street, and in the activities of the banking and brokerage houses in their handling of the financial work of the country. Of particular interest to the investor are those investment problems with which the investor is confronted in the selection of securities which will provide safety of principal, a good in- come, and prospects of appreciation in the value of his security holdings. This interest has led to an increasing demand for informa- tion on the subject of investments, and has resulted during the past five years in the publication of many works on investment and finance which has made available a broad fund of knowl- edge to those desirous of becoming better infortned on this rather complex subject. In this literature are many volumes on the principles of in- vestment, investment analysis, the management of investment funds, the analysis of financial statements, the work of invest- ment trusts, the structure, operation and methods of the stock market, and on the subjects of finance and economics as related to the problems of investment. Included also in this literature are treatises on the effects of new industrial developments and changing economic conditions on security values; on the rela- tion of the cyclical movement of business to investments, and the significance of such movements as providing opportunities for the more rapid enhancement of principal and income. Therefore, while today the field of investment literature affords many works of great practical value to the investor, to the best of the author’s knowledge there exists no work on the routine methods and practices employed by brokerage houses in the handling of securities, or on the mechanics of the transactions involved in the purchase and sale of securities for investment, speculative or trading purposes. WALL STREET In order to meet the need for a book covering this field Wall Street has been written. It represents the knowledge gained by the author in more than twenty-five years of active experience in connection with practically all departments of the brokerage business. The volume is used as a text in the Wall Street Business School, and has been written primarily for those interested in obtaining a practical knowledge of the mechanics involved in the work of the modern brokerage house. In this volume the author has treated in detail the work of the Order Department, the Bookkeeping Department and the Margin Department. The work of the Transfer, Dividend and Stock and Bond Record Departments are also covered, as well as the work of the Cashier, the Cashier’s Cage, the Loan Clerk, the Clearing House Clerk, and the other activities of the broker- age house. In addition, the functions, organization and opera- tion of the New York Stock Exchange and the Clearing House Corporation are also presented in such manner as to show clear- ly the work and the relation of these organizations to the work of the brokerage house. While, due to the differences in the size of the houses and the character of the business done, the organization set-up and routine methods of some brokerage houses may vary somewhat in detail, the routine methods and practices as presented herein represent the practices which are standard in the great majority of the brokerage houses. Covering as it does, the practical working of these depart- ments and organizations, it is believed that banking and brokerage houses generally will find this volume helpful as a work of reference, and that those at present engaged in carry- ing on the detail activities of these houses will find the work of considerable practical value in the handling of the problems which arise daily in connection with their work. In addition, it is believed that the general investor and trader will also find that an understanding of the practices followed by banking and brokerage houses in the handling of investment and trading transactions will be of considerable value in en- abling them to prevent the losses frequently sustained through oversights, mistakes or misunderstandings, in connection with their investment and speculative activities. C. F. H. 8 CHAPTER I The New York Stock Exchan g THE NEW YORK STOCK EXCHANGE Functions and Services of the Exchange. How Orders are Handled. Government and Organization. History of Growth and Development. Listing of Securities. The fundamental and basic function of the New York Stock Exchange is to distribute securities to investors and provide a ready market for their resale. In other words, it is a market place for securities. Securities are sold like anything else and in order to handle the work involved in their distribution in as efficient and economical a manner as possible marketing places or stock exchanges are established. The average investor usually considers the stock exchange to be a place which exists primarily for the purpose of handling the transactions involved in the purchase and sale of securities. This, however, is only one of the functions performed by the Stock Exchange, for in addition to the routine handling of the large volume of transactions daily consummated through the facilities which it affords, it also performs many important economic functions in the life of the nation. Through the machinery of the New York Stock Exchange large amounts of capital, as represented by the savings and surplus wealth of the nation, are continuously being received in Wall Street and redistributed throughout the country for use in connection with the development of the natural resources of the nation. The surplus funds accumulated throughout the different sections of the country come into Wall Street to be employed in the development of the many industrial enter- prises which exist and which are being organized or expanded to supply the many wants and needs of the nation in the form of houses, clothing, food, automobiles, education, entertain- ment, et cetera. The capital thus received flows in to this East- ern capital market regularly from Texas, Maine, Minnesota, California and all of the other states of the country and is in- vested or loaned there on call. With equal regularity hardly a day passes but what the funds originally accumulated in Wall 13 WALL STREET Street and in the Eastern markets are sent out again to the South, North and West to be used in financing the rapidly developing business enterprises in these sections of the country. In this work, as already stated, the New York Stock Ex- change plays an important part. Through its facilities and organization the securities representing the capital to be em- ployed in this manner are afforded a broad and ever growing market, and a market in which the Exchange Association em- ploys its great power to maintain at all times fair and equit- able principles of trade, and to protect the investing public from placing its funds in unworthy enterprises as far as its authority and powers allow. The New York Stock Exchange of today is the result of a natural economic evolution extending back to 1792, and the transactions on its floor are at all times completely subject to severe competition from other security markets all over the world. A stock exchange represents merely a higher form of organization for marketing securities than that developed through unrestricted trading between individual houses, and because of their obviously superior services to the public, stock exchanges have increased in numbers and scope every- where in the world by a natural process of evolution. There are now over 200 stock exchanges in the world, and over 20 in the United States alone. The stock exchanges of New York, (including the New York Curb Stock Exchange, which is the second largest exchange in the United States) Philadelphia, Boston, Chicago, Pittsburg, San Francisco and those of the other cities where organized stock exchanges are maintained, represent the principal secur- ity markets of the country, although stocks and bonds are also bought and sold in considerable volume through agencies other than the organized exchanges. Generally speaking, however, the facilities for the purchase and sale of securities in what is known as the unorganized, or “outside market” are not as readily available to the average investor or trader, nor are the conditions in such markets as favorable to the maintenance of fair markets at all times as those of the organized stock markets. Among the more important economic functions performed by the organized stock exchanges, and particularly as performed by the New York Stock Exchange, are the following: 14 WALL STREET 1. The establishment of reliable, close and completely com- petitive security prices, and their instant distribution all over the country through the stock ticker system. 2. The superior ability of the Exchange to maintain its mar- kets during periods of economic pressure, compared with the tendency of the “outside market” to suspend at such times. 3. The superior negotiability and availability for collateral purposes conferred by the Exchange on its listed securities. 4. The greater relative equality established on the Exchange between large and small buyers and sellers. 5. The greater amount of information concerning corporate securities made available to investors by the listing require- ments of the Exchange. 6. The severe regulation of methods of purchasing and sell- ing securities, and the ability of the market as a whole to dis- cipline unfair actions by any of its members. LISTING OF SECURITIES In view of the importance of the listing requirements of the New York Stock Exchange as a protection to the investor it seems desirable to discuss here in greater detail the precautions which the Exchange takes in this connection. From the beginning of this work it has been primarily in behalf of the American investing public that the listing re- quirements of the New York Stock Exchange have been formu- lated and enforced. The New York Stock Exchange is just as particular about the securities admitted to trading in its mar- kets, as it is to the individuals admitted to its membership. As already stated, before a security can be traded in upon the Exchange, it must conform to what are known as the listing requirements of the Exchange. These requirements are un- doubtedly the strictest and most extensive of any large Stock Exchange organization in the world. The financial structure of the applicant corporation must be explained in detail and com- plete statements as to its assets and liabilities, and its recent earnings, must be made. Moreover, even after a security has been admitted to trading on the Exchange, it must periodically publish earnings statements and balance sheets in the public press, so that the public can have the opportunity of studying them. 15 WALL STREET While the listing of securities on the Exchange is of con- siderable value to the investing public it is by no means a guarantee of the value of the securities there listed, nor any guarantee that certain of the securities at present listed may not depreciate in value, or that some day they may not be worthless. As a result of inventions, changing economic and industrial conditions, new wants and needs of the public, the securities of corporations that were once “gilt edged” may de- preciate materially in value. With such changes ever taking place in industry there is no way for the investor to protect himself except by becoming informed on investment matters. The ordinary investor very often refuses to study the prob- lems of investment, or the complicated data connected with any given investment security. He wants a short cut, and he is only too likely to settle on listing by the New York Stock Exchange as a substitute for investigation and analysis on his own part. The Stock Exchange, of course, cannot essay the role of in- vestment advisor. It has no voice in the management of com- panies listed on the Exchange. It has no means of telling in advance what corporation managers may do, or what special economic tendencies may arise in American business, both of which are determining factors in the success or failure of al- most any security investment. It is also impossible for the Stock Exchange to verify completely the accuracy of the state- ments made to it in the listing applications of the business cor- porations. Little difficulty is as a rule experienced from this source, although in specific instances incorrect statements have been foisted on the Stock Exchange no less than on the in- vesting public. Under these circumstances, the fact that a given security is listed on the New York Stock Exchange should not be taken by the investor as any guarantee or special endorsement of the security by the Exchange. The work of handling applications for listing involves three distinct phases, each of which plays an important part in the listing process. At the outset the applicant company, as repre- sented by its own officers, its counsel or its bankers, is furnished by the Committee on Stock List with three separate forms to be filled out and submitted to the Committee. The first form, known as the “distribution statement,” re- quests the company to state the various amounts of its shares held in blocks of different sizes from 100 to 1,000 shares and up, and also the number of shares held by the ten largest stock- 16 WALL STREET holders of the concern. The Stock Exchange is not interested in who the stockholders are, but it requires assurance that the shares shall be sufficiently distributed before listing to permit the establishment of a free and open market for the new se- curity on the Stock Exchange. With the same purpose in view, the company is required to give assurance that “all stock is free for sale and is held under no syndicate, agreement or con- trol.” Because of this requirement by the Exchange that new stock issues applying for listing upon it must already have a fair preliminary distribution, it is sometimes necessary for very sound companies to list and distribute their shares on the New York Curb market, or on some other preliminary market, prior to their admission to the floor of the New York Stock Ex- change. The second form, called the “questionnaire,” contains a series of questions whose answers establish the relationship to the corporation of the person or persons applying for a listing, and other miscellaneous matters. On this form the New York Stock Exchange endeavors to secure the agreement of the ap- plicant corporation to publish quarterly statements as to its earnings. Some companies, however, object to issuing quar- terly earning statements, on the ground that it would place them at a disadvantage with competing concerns who did not do likewise. Also, concerns having foreign properties or sub- sidiaries sometimes complain that the making of such frequent earning statements involves serious practical difficulties. An- other common objection is that some concerns do a very sea- sonal business, with large earnings at one period of the year and with low earnings or actual deficits in other months, and that consequently the publication of the quarterly earnings of such corporations would tend to alternately excite and alarm shareholders and lead to unnecessary price fluctuations and speculation in the shares of these companies on the Exchange. The third document involved in applying for listing on the New York Stock Exchange is known as the “list of require- ments.” This contains the rules governing the preparation of the actual security certificates for which contracts are to be made on the Exchange floor. When it is realized that the ag- gregate listings on the Exchange today, exclusive of U. S. Government bonds, amounts to over fifty billions of dollars, it will be readily appreciated that great care must be exercised against forgeries of listed stock and bond certificates. The 17 WALL STREET New York Stock Exchange has not gone so far as to engage directly in the business of printing and engraving security certificates, but it has insisted that only engraving companies officially approved by it may prepare stock and bond certifi- cates which are to be listed on the Exchange. In connection with the preparation of the listing application, the Committee on Stock Listing stands ready to assist the appli- cant company by explaining the technical provisions of the re- quirements. In this regard, the listing requirements form con- tains the following definite and significant statement, “The em- ployees of the Committee on Stock List are instructed to assist in the preparation of applications to list whenever so requested. No charge will be made for such service.” When the application is finished, it is submitted by the Com- pany to the Committee on Stock List, which sets a date for a hearing upon it. A notice is at once posted on the Exchange Floor, in order that Exchange members who have any knowl- edge concerning the issue under consideration can impart it to the Committee, and thus assist the latter in its delibera- tions on the subject. On the date set, the representatives of the applicant company appear before the Committee on Stock List, and after the hearing the Committee gives or withholds its approval of the issue for listing. If the issue is approved by the Committee on Stock List, the application is then placed before the Governing Committee of the Exchange with the recommendation that the application be granted. The Govern- ing Committee completely retains its power to hold up or re- fuse its approval in the matter, and not infrequently exercises this power. The approval of the Governing Committee is the final author- itative step necessary in the Exchange for the listing of a new security issue. Generally a notice that the listing application has been granted is sent out over the ticker, the new security is assigned to a trading post on the floor and is given a ticker symbol, and trading in it starts the day after the action by the Governing Committee. In some cases, however, special circum- stances make it desirable to delay the beginning of trading in the new issue until some subsequent date. The work of the Stock Exchange is not, however, concluded after the new security has been officially listed. The Stock Exchange must see that the corporation lives up to its agree- ments in the matter, particularly with respect to the publica- 18 WALL STREET tion of current earnings. The New York Stock Exchange makes no attempt to keep a permanent file of earning statements, balance sheets, or other such material. It, in fact, refuses to receive any statements from the corporation which cannot be made available to its stockholders or the public. The aim of the New York Stock Exchange in its continuing supervision along this line, is to see that listed corporations publish their earnings as promptly and fully as possible, and thus make them available to everyone in the country on an equal basis. In its agreement with a corporation listing securities on its floor, the New York Stock Exchange always retains the com- plete right to suspend trading in any issue at will, or even to strike any issue permanently from its list. A final factor in the daily work of the Stock Exchange in connection with its listing lies in supervising the constant changes in the amounts of the many issues on its list. This involves a huge amount of technical detail. The amount of se- curities listed changes constantly, not only by whole issues admitted or stricken at one time, but also by small amounts of issues already listed, added or withdrawn from the list. Be- tween 40 and 80 different listed issues change their amounts on the list in this way every day. Bond amounts are reduced by such factors as conversion and sinking fund retirement, while stock issues may be expanded by rights and stock dividends, and either increased or decreased by exchanges of securities during reorganizations. The Stock List Committee must keep in touch with the registrars of over 1,000 separate stock issues alone, in order to safeguard the public interest by a proper su- pervision of changes which, often inconsequential in them- selves, are of great significance in the aggregate. HOW ORDERS ARE HANDLED The large volume of orders which come daily into the New York Stock Exchange are received from all sections of the United States and all parts of the world. To illustrate the progress of these orders through the machinery of the Ex- change we will explain here the progress of an order from the time it is placed until the last operation in its execution has been completed. To assist in clarifying this description, out- lining the course of a transaction through the complexities of this highly organized market, we present in the following 19 WALL STREET pages a diagram of the interior of the New York Stock Ex- change showing the Telephone Booths, Trading Posts, Ticker Transmitters, Annunciator Call Boards, Money Desk and the Pneumatic Tube Stations. For the sake of simplicity, we will suppose that you, the x-eader, are in a Chicago branch office of the New York Stock Exchange firm of John Doe & Company, and wish to buy one hundred shares of Hudson Motors common stock at the current market price. Your first action will be to fill out a buying order on a form provided by the brokers, instructing them to buy one hundred shares of Hudson Motors “at the market.” Your written order is recorded by an order clerk and immediately transmitted over the broker’s private telegraph wire to their New York Office. Here it is received and turned over to an order clerk who trans- mits it at once to the Exchange floor over a private telephone. The floor telephone is situated in one of the many telephone booths indicated by “A” in the accompanying picture of the interior of the Exchange. These telephones are served by clerks employed by the membei-s. As the telephone clerk receives your order over his telephone he writes it on an order slip and at the same time presses a but- ton in his booth, which operates a number on the great black annunciator board “D.” This number has been assigned by the Exchange to the floor member of your brokerage firm and signals him to his booth. Execution of an order. With your order in his hand your broker must buy for you one hundred shares of Hudson Motors at as low a price as they can be bought in the market at that time. In a word, he becomes your representative on the floor of the Exchange and must act in your behalf according to his best judgment. Trading Posts. Bids and Offers. When Hudson Motors stock was listed on the Exchange, it was assigned to “post” two (the post in the foreground marked “B”). This post then became the market for Hudson Motors. Similarly, each of the several trading posts throughout the room is the market for twenty or thirty different stocks. On his arrival at post two your broker hears Hudson Motors being offered at 142 1 / 4 ($142.25) ; he also hears another broker bidding 142% ($142.12%) for it. Thus 20 WALL STREET he is at once informed of the true market for the stock, which is, $142,121/2 a share bid, offered at $142.25 a share. Buying the Stock. As your broker has authority to buy the stock for you “at the market” or at the lowest price at which it can be had, he says to the broker offering to sell at 142 1 / 4 ($142.25) : “Take it,” and the transaction is made. No written agreement or memorandum of any kind is exchanged by the contracting brokers. All contracts made on the floor of the Exchange, involving in the aggregate, frequently upwards of three hundred millions of dollars in a day, are made in this apparently informal way and yet such contracts are always held inviolable by members of the Stock Exchange. Transaction Reported. Your broker sends to his telephone clerk a memorandum report that he has bought 100 Hudson Motors at 142)4 ($142.25) from Richard Roe (another broker). The clerk promptly telephones the report to the office, and it is telegraphed to the Chicago branch office. So swiftly does all this take place, that there are instances in which orders given in San Francisco have been executed on the floor of the Exchange, three thousand miles away, and reported back to the customer within sixty seconds of time. The Exchange a National Market Place. Since branch offices and correspondents of Stock Exchange firms can be found in practically every city of size in the United States, it will thus be seen that the Exchange to all intents and purposes succeeds in bringing to its floor, face to face, all investors in the land interested in buying or selling listed securities. Deliveries and Payments. The contract which your broker closed when he said the words, “Take it,” obliges him to re- ceive before 2:15 P. M. on the full business day following, a certificate for 100 shares of Hudson Motors Stock and pay $14,- 225 for it. In the meantime the Chicago branch office mails you a memorandum of the transaction, stating that they have bought “for your account and risk in accordance with the rules of the New York Stock Exchange” 100 Hudson Motors at 142)4 ($142.25). Commissions. If you are buying the stock outright, you will pay, on the day following the purchase, the full amount of your 21 WALL STREET purchase price, plus the broker’s commission. If you so direct, the branch office will then instruct the home office in New York City to have the certificate transferred to your name. Should you sell your stock at a later date, your broker will pay you the proceeds of the sale, less the commission and the Federal and State sale taxes. Tickers. Standing in the “Hudson Motors crowd” at the mo- ment your stock was bought, was one of the official reporters employed by the Exchange. When the transaction is effected, that is, when your broker and the selling broker have agreed on quantity and price, the reporter makes a memorandum of the sale on a slip of paper, reporting the transaction like this : HMT14214, meaning one hundred shares of Hudson Motors sold at $142.25 a share, HMT being the symbol for Hudson Motors. The slip of paper is at once placed before one of the five ticker operators stationed at sending stations on the floor and he flashes it over the ticker instruments located in mem- bers’ offices in the Wall Street section of New York City. The Western Union Telegraph Company, under agreement with the New York Quotation Company, picks the quotation up from one of these tickers and flashes it over its ticker system, serving the principal cities in the United States. Thus you, in the Chi- cago branch office, and countless others, see the printed report of your purchase on a normally active day a few moments after your stock has been bought in the open market. This instant and broad publicity given to transactions on the Exchange makes deception in regard to market prices of listed securities practically impossible. Margin. When you bought your 100 shares of Hudson Motors at 142^, we assumed that you had the money to pay for them. Let us now suppose that instead of the $14,225 involved you had only $4,000, but still wanted to buy 100 shares, believing that the price would rise in the future, so that you could sell at a profit, or intending to hold it as a good investment with the expectation of paying the balance from time to time out of your savings. The machinery of the Exchange recognizes no difference be- tween the two transactions. The purchase on the floor, the de- livery and payment on the business day next following, go for- ward identically in both instances. The difference appears in 22 WALL STREET your relations with your broker. In the first instance you paid your broker the purchase price of the stock, plus the commis- sion; he delivered the certificate to you and the transaction was closed. In the second instance, however, you only paid your broker $4,000 (called “margin”), leaving a balance of $10,250, including the commission, which you still owe him. Instead of delivering your certificate to you, it is held by the broker as collateral to secure the balance which you still owe on your purchase. If you bought real estate worth $14,225 instead of securities, the arrangements would be substantially the same. You would have had to borrow the $10,225 and pledge the property to se- cure the lender in the repayment of the loan. Unit of Trading. The 100 shares you have just bought con- stitute a unit of trading. If you had bought less than 100 shares, say 25 shares, the process would have been somewhat different. The volume of business done on the Exchange and the prac- tical problems of handling and reporting it with the greatest economy of effort and the smallest risk of error have made the adoption of 100 shares as the unit of trading a matter of nec- essity except in the case of comparatively inactive stocks where a ten share unit of trading has been adopted. The bidding and offering in the open market is done in the unit of 100 shares or multiples thereof, and these constitute the reported transac- tions. In addition, however, there is a vast amount of business in lots of less than 100 shares which is not reported, but which it is estimated runs as high on occasions as one-third of the market for 100 share trading. / Odd Lots. Your order for 25 shares of Hudson Motors reaches the telephone clerk in the same way as did the 100 share order but from then on it is handled differently. There are several large firms that specialize as dealers in fractional lots commonly known as odd lots. They have no dealings with the public but stand ready to buy from or sell to other brokers any number of shares up to 99 of any stock listed on the Exchange at a dif- ference of from Ys to Yt away from the next open market trans- action or on the bid and offer. The clerk writes out the order as before, only instead of signalling your broker, he writes the name of an “odd lot” firm on the back and hands it to a tube attendant. Pneumatic tubes connect stations at the ends 23 WALL STREET of telephone stalls with every post. The tube attendant folds the written order into a cylindrical container, which is sent to the Hudson Motors post, where another attendant hands it to a representative of the “odd lot” firm to which it is addressed. With your order to buy 25 shares at the market in his hand, the “odd lot” dealer waits for the next 100 share transaction. If it is at 14214 ($142.25), he sends a report to your brokers that he has sold to them 25 shares of Hudson Motors at 142% ($142.37%). Specialists. In each of the cases just discussed, your orders directed your broker to buy “at the market,” meaning at the lowest price obtainable when your order reached the floor. But let us suppose that you thought by being patient you could buy it lower than the price then current. You are willing to pay $140 per share but no more. You then give your broker a G. T. C. (good ’till cancelled) order to buy 100 shares of Hudson Motors at 140. Your limit price now being several points away from the market, it may be a matter of days or weeks before it is reached. With hundreds of similar orders on his books and many more at or close to the market, it would not be possible for your broker to keep track of them all. He therefore usually gives out limited orders away from the market to specialists, who execute them exactly as the broker would. Thus your order to buy at 140 would be sent by your brokers’ telephone clerk through the pneumatic tubes to the Hudson Motors post where it would be handed to a specialist in Hudson Motors. Specialists are members who remain at one post and execute orders for other members in stocks listed at that post. The specialist enters your order on his book and there it remains in the order in which it was received until you countermand it, or until the quotation of Hudson Motors declines to your price and the order is executed. 24 WALL STREET 25 DIAGRAM SHOWING ARRANGEMENT OE EQUIPMENT OF THE NEW YORK STOCK EXCHANGE WALL STREET A. Telephone Booths — Containing private telephones connected with Stock Exchange members’ offices. B. Trading Posts — As stocks are admitted to the board for trading they are assigned to one of these “posts.” Thus the brokers with orders to execute in Hudson Motors stock assemble at Post No. 2. C. Ticker Transmitters — As transactions are made, reporters on the floor (recognized by their uniform caps) report the sales to ticker operators. These operators at once send them over the ticker system by means of the typewriter-like elec- trical sending machines before them. D. Annunciator Call Boards — The white numbers are operated from the telephone booths. When a broker is wanted, his telephone clerk signals him by pressing a switch in his booth which drops the broker’s signal number. E. Money Desk — Offerings of money to loan on collateral se- curity are received from the banks by the Money Clerk sta- tioned there. Brokers desiring to borrow money are ac- commodated in order of their application. F. Pneumatic Tubes — Connecting telephone booths with the trading posts. By means of these tubes messages can be sent instantly by the telephone clerks to any post on the floor. Only members of the Stock Exchange are admitted to the floor for trading. Telegraph operators are distinguished by their uniform caps ; pages and guards, by their uniforms. Tele- phone clerks employed by members are not permitted to leave their booths. Members on the floor of the Exchange wear badges giving the member’s name, firm or clearing name. 26 WALL STREET ORGANIZATION The New York Stock Exchange is a voluntary association of its members, established for the purpose of providing them- selves a free and carefully regulated market for the purchase and sale of securities. It is operated under the provisions of its constitution and by-laws which constitute a contract between its members. The membership of the Exchange is limited by its constitution and cannot be increased except by action of the Governing Committee subject to the approval of a majority of the members. For fifty years, from the year 1879 up to February 7, 1929, the membership of the exchange has remained at 1100, but on February 7, 1929 the members of the exchange approved the sale of 275 new “seats” or memberships, and each member was at that time given the right to subscribe to one quarter of a new membership which he could dispose of within three years by sale or transfer. This will increase the membership to 1,375. The Exchange is neither a partnership or a corporation. It has a constitution and by-laws but no charter. The association has no capital and has issued no property rights of any kind to its members. The Exchange is unlike a partnership in that the death, withdrawal, or removal of a member does not affect its life. Each member voluntarily enters the association by its per- mission, and since he acquires no profit rights in the associa- tion, and since the association has asked no special favors from the state and has received none, it has the right to discipline and expel its members as it sees fit. As defined in its constitution the objects of the New York Stock Exchange are “to furnish exchange rooms and other facilities for the convenient transaction of their business by its members ; to maintain high standards of commercial honor and integrity among its members; and promote and inculcate just and equitable principles of trade and business.” Firms having as a general partner a member of the Exchange are entitled to have their business transacted at the rate of commission prescribed for members. A firm of which one of the partners is a member of the Exchange may be registered on 27 WALL STREET the Exchange and contracts may be made there in its name, but no one is permitted to transact business on the floor except the individual member of the Exchange. Each member who represents a firm is as responsible for the conduct of the firm as though it were his individual conduct. The present membership of more than 1,200 is represented by several hundred firms, who probably have close to 4,000 part- ners. Usually a firm may have not more than one partner in the Exchange but there are many which have two or three and some which have as many as six or eight partners who are members of the Exchange. Of the more than 1,200 members of the Exchange not all are brokers. Members who do not act themselves as brokers, employ brokers, and, of course, as mem- bers of the Exchange they obtain a lower rate of commission than they could as outsiders. Government and Governing Committee Government and Officers. The government of the Exchange is vested in a Governing Committee, which consists of President and Treasurer and forty members. The members of the Govern- ing Committee, the Assistant to the President, the Secretary, the First Assistant Secretary, the Accountant, and the Econo- mist are all officers of the Exchange. Governing Committee. The Governing Committee is vested with all powers necessary for the government of the Exchange, the regulation of the business conduct of its members, and the promotion of its welfare, objects and purposes, and in the ex- ercise of its powers, it may adopt such rules, issue such orders and directions, and make such decisions as it may deem appro- priate. It deals directly with all the larger questions of policy and is the tribunal that tries all charges against members of the Exchange. The details of the government of the Exchange are in the hands of various Standing Committees made up of mem- bers of the Governing Committee. The Governing Committee has control of the property and finances of the Exchange, and may appoint, dismiss and deter- mine the number, duty and pay of employees. It may also re- quire that officers, appointees, or employees give good and suf- ficient bonds for the faithful performance of their duties. Rules. The constitution of the Exchange further provides 28 WALL STREET that the Governing Committee shall prescribe rules for dealing on the Exchange. It shall prescribe rules as to contracts, the performance thereof, default, and insolvency, which shall be applicable to Exchange contracts, and may extend or postpone the time for the performance of Exchange contracts, when- ever in its opinion such action is called for by the public in- terest or by just and equitable principles of trade. The List. The Governing Committee may admit to dealing upon the Exchange, securities, and also securities on a “when issued” basis, and may suspend dealing therein, or may remove the same from the list. Corners. Whenever in the opinion of the Governing Com- mittee a corner has been created in a security listed on the Exchange, or a single interest or group has acquired such con- trol of a security so listed that the same cannot be obtained for delivery on existing contracts except at prices and on terms arbitrarily dictated by such interest or group, the Governing Committee may postpone the time for deliveries on the Ex- change contracts involved, and may from time to time fur- ther postpone such time or may postpone deliveries until fur- ther action by the Governing Committee. Where delivery is not made in accordance with the ruling of the Governing Commit- tee in such cases, the contracts are settled at what is deemed a fair settlement price. If the parties to the contract do not agree on a fair settlement price the Governing Committee may es- tablish what it deems a fair price and the date for the payment of same. In such cases the Governing Committee before fixing the same will give the parties to the contract which is to be settled in this manner, an opportunity to be heard either before the Governing Committee, or before a Special Committee ap- pointed for the purpose. Quorum. Fifteen members of the Governing Committee are necessary to constitute a quorum for the following purposes : 1 — To admit to dealing upon the Exchange securities or se- curities on a “when issued” basis ; 2— To suspend dealing in or to remove from the list any securities or securities on a “when issued” basis admitted to dealing upon the Exchange ; and 3 — To extend or to postpone the time for the performance of Ex- change contracts, whenever in the opinion of the Governing Committee such action is called for by the public interest or by 29 WALL STREET just and equitable principles of trade. For all other purposes, a majority of all the existing members of the Governing Com- mittee shall be necessary to constitute a quorum. The foregoing description of the Governing Committee out- lines briefly some of the principal powers of this committee, and we will now consider the work of the Standing Committees, which committees, as stated previously, handle the details of the work involved in the government of the Exchange. STANDING COMMITTEES The constitution provides for twelve standing committees, the membership and duties of which, are as follows : 1. Committee on Admissions. This committee, consisting of 15 members, handles all applications for admission or readmis- sion or reinstatement after suspension, and also examines the cause of every insolvency in the membership. The committee’s favorable action on admissions, readmissions or reinstatements requires the affirmative vote of at least ten members. 2. Arbitration Committee. All matters of difference aris- ing from Members’ Contracts between members of the Ex- change or firms registered on the Exchange shall be brought before this committee consisting of nine members. Any claims or matters of difference between a member of the Exchange and a non-member are handled by this committee, and may be referred to it by the non-member. The decision of the Committee shall be final except that an appeal may be made by a member of the Committee to the Governing Commit- tee. In cases of dispute where the sum involved is $2,500 or over, one of the parties concerned may within ten days appeal directly to the Governing Committee. In matters of difference submitted by a non-member, before considering the claim or difference, the Arbitration Committee may re- quire the non-member to comply with such terms and condi- tions as it may deem proper, thus obligating him to abide by the decision. 3. Committee of Arrangements. This committee, consisting of seven members, has the following powers and duties: It is required to make and enforce rules and regulations for the convenient transaction of business upon the Floor of the 30 WALL STREET Exchange, and the methods of dealing thereon not specifically referred to other committees. It has general care and super- vision of the Floor and the premises of the Exchange and of all connection and communication apparatus such as telegraph, telephone, wireless, messengers or other devices of this charac- ter used in transacting the business of the Exchange. It is also the duty of this committee to provide for the comfort of mem- bers and employees of the Exchange; to maintain order and see that the methods of conducting the business on the Floor do not obstruct or retard business and are conducive to the proper handling of the business of the Exchange. It may admit or ex- clude from the floor of the Exchange or its premises those who, in its opinion, should be admitted or excluded. 4. Committee on Business Conduct. It is the duty of this Committee, consisting of five members, to consider matters re- lating to the business conduct and financial condition of mem- bers and their customers’ accounts; and to observe the course of transactions on the Exchange, with the view to seeing whether resort is being had to improper transactions. It has the power to investigate the dealings, transactions, and finan- cial condition of members, and to examine their books and papers ; and to report to the Governing Committee any matter which in its judgment requires the consideration of that Committee. 5. Committee on Constitution. This committee, which con- sists of five members, handles all matters involving proposed additions, alterations, or amendments to the Constitution, and is required to report back to the Governing Committee after due consideration has been given thereto. 6. Finance Committee. This committee consists of seven members and is required to meet at least once in each month, examine the accounts and vouchers of the Exchange, and re- port the result of its examinations to the Governing Committee. It submits to the Governing Committee each year a statement or budget setting forth the estimated income and appropria- tions for expenses of the Exchange for the following year, and is required to report and make recommendations as to the financial policy of the Exchange. 7. Law Committee. This committee deals with matters of law affecting the interests of the Exchange, and acts also in 31 WALL STREET an advisory capacity to the President when requested by him. It also represents the Exchange in all matters affecting its general interests, and is authorized and empowered, in its dis- cretion, to examine into the dealings of any member of the Ex- change. 8. Committee on Odd Lots and Specialists. This committee, consisting of five members, has general supervision over deal- ings in lots of stock of less than one hundred shares and the methods of the specialists. It formulates and submits to the Governing Committee for its adoption rules and regulations with respect to these matters, and requires the observance of these rules when they have been adopted. 9. Committee on Publicity. The five members of this com- mittee, under the direction of the President, exists for the pur- pose of keeping the public informed concerning matters of public interest having to do with the Exchange. 10. Committee on Quotations and Commissions. This com- mittee, of nine members is charged with the responsibility of seeing that the provisions of the Constitution and of the rules adopted in accordance therewith, relating to commissions, part- nerships, offices of members whether main offices or other offices, and to foreign joint-account arbitrage are observed, and is required to report to the Governing Committee any vio- lations in these matters. It is required to report to the Govern- ing Committee any partnership or any condition existing in an office which may appear to be detrimental to the interest or welfare of the Exchange. In addition this committee has charge of all matters relating to the collection, dissemination and use of quotations, and may approve or disapprove any ap- plication for quotation service to a non-member, or for tele- phonic or telegraphic wire or wireless connection between the office of a member or a member’s firm and the office of any corporation, firm, or individual not a member of the Exchange, transacting a banking or brokerage business. It also has the power to disapprove the furnishing of any such quotation service or any wire or wireless connection, and to require the discontinuance thereof. It further may inquire into wire or wireless connections of every kind whatsoever between the office of a member and any member or non-member, and may require the discontinuance of any such connection. The work 32 WALL STREET of this committee has been quite effective in preventing the mis- use of information, and it has done much to raise the standards of houses receiving stock quotations in recent years. 11. Committee on Securities. This committee, consisting of five members, makes the rules relating to the delivery of se- curities on Exchange contracts, including reclamations there- for, irregularities therein, and pertaining to interest and divi- dends thereon; to due-bills and contracts for future delivery; to deposits on Exchange contracts, and decides all questions arising out of such subjects. It also permits dealing in rights growing out of securities already listed on the Exchange ; and may make regulations concerning any rights in which dealing may be permitted. 12. Committee on Stock List. One of the most important services of the Exchange in so far as it affords protection to the investing public with respect to the securities in which they are invited to invest is that represented by the work of this committee. Any Corporation desiring to list its securities on the New York Stock Exchange must meet the requirements of the Exchange in this matter, and since these requirements are without doubt more strict than those of any other Exchange in the world, the investing public is accordingly afforded a measure of protection of much value to the investor who takes the trouble to properly inform himself concerning the financial position and prospects of the corporations listed on the Ex- change in whose securities he may be interested. This committee, consisting of six members, receives and con- siders all applications for placing securities on the list of the Exchange, on which it reports and makes recommendations to the Governing Committee. It makes the rules prescribing the requirements for listing and such other rules and regulations in relation to the listing of securities as may be deemed expe- dient or necessary. In its discretion it permits dealings on a “when issued” basis in (1) Certificates of deposit or interim receipts for securities, (2) in securities of a corporation, the securities of which are already listed on the Exchange, or (3) in securities growing out of securities already listed. Obligations of the Government of the United States, or of any State, County or City of the United States, and the ex- ternal dollar bonds of a foreign government may be placed upon the List without report and recommendation to the Gov- 33 WALL STREET erning Committee. This committee also has the power to di- rect that any security listed upon the Exchange be removed from the List and further dealing therein prohibited upon maturity of such security, or when it shall appear that the out- standing amount of the security has become so reduced as to make inadvisable further dealing in it upon the Exchange. In addition to the committees already mentioned there is also a Conference Committee, which consists of the President, Vice President and Treasurer, and the Chairmen of the Committees on Admissions, Arrangements, Business Conduct, Law, Odd Lots and Specialists, Publicity, Quotations and Commissions, and Stock List. This committee hears reports from the various Committees and from others; advises with them concerning questions affecting the welfare of the Exchange, and recom- mends to the Governing Committee such action as in its opinion will prove beneficial to the Exchange. HISTORY The New York Stock Exchange has existed as an important factor in the financial activities of the nation for almost 150 years, having been established as an organized association in the latter part of the 18th century. It had its origin in the finan- cial needs of a young Republic. Prior to the Revolution, securi- ties were practically unknown in the United States, but the first Congress in 1790 authorized the issue of eighty millions of dol- lars in bonds which were promptly absorbed by investors. At about the same time three important banking institutions were incorporated and their stock sold to the public. The sale of these securities created a demand for a market and one was promptly developed under a buttonwood tree which stood at what is now known as No. 68 Wall Street. The present Stock Exchange traces its origin to a group of a dozen men who held daily meetings under this tree and who were the first stock brokers in the United States. It was in 1792 that a formal organization was effected. By this time the small group of brokers had increased to twenty- four in number and they signed an agreement binding them- selves to certain regulations and restrictions in the matter of commissions for the execution of orders and in their dealings with one another. 34 WALL STREET The debt of the United States Government was increased as a result of the War of 1812, and this, quite naturally, broadened the scope of the securities market, and subsequently the rapid industrial development of the growing nation and its invest- ment requirements made it necessary to recognize that market. In 1817 rooms were engaged at No. 40 Wall Street, and it was there that the first indoor securities market in the United States began to function under a constitution and set of rules. This first constitution provided that “any member making a fictitious sale or contract shall, upon conviction thereof, be ex- pelled from the Board.” This prohibition has ever since been a part of the constitution of the New York Stock Exchange, and some years ago that principle was embodied in the laws of the State of New York. For the next half-century the development of this market was steady and it was moved from time to time as the need for larger quarters in which to handle the growing business made it necessary. Early in 1863 the title of the Exchange was changed from the “New York Stock and Exchange Board,” to the “New York Stock Exchange,” and a few months later the New York Stock Exchange Building Company was organized to provide a permanent and commodious home for the market. During this period of development in the securities market, rapid progress had been made in the industrial life of the na- tion. The adoption of steam power and the rapid construction of railroads necessary to open the vast and almost unknown areas in the western section of the country naturally resulted in a large volume of corporate securities which, in the main, found their way to the New York Stock Exchange as the single free and open market in the entire country. Inasmuch as the building of railroads was the outstanding factor in the economic and physical development of the country of that day, it was natural that the Stock Exchange should become the principal market for railroad securities. At the same time business was done in bank securities, in Government bonds, and, in smaller volume, in the securities of a few indus- trial concerns. It was not long, however, before there was a great broadening movement in the securities field, for in push- ing ever farther into the west the boundaries of American civilization, the pioneers of the day were building cities, erect- ing factories and requiring more and more investment capital 35 WALL STREET with which to carry on their task. First came the need for gas, then electricity, then the telephone, and so there was evolved another new type of security — the public utility issue, which has since taken its place alongside of the railroad and the in- dustrial security as a means of investment. In the latter part of the nineteenth century the evolution of manufacturing industries into large scale corporate units pro- ceeded swiftly and added enormously to the demands upon the securities market. As a result, the Stock Exchange was once more compelled to take steps toward securing more ample quarters. The opening up of the vast resources of the west by the rail- ways, and the increased production made possible by steam power, created a great deal of new wealth which was dis- tributed into many hands. This new capital found its way into various fields of investment, and increasingly large new issues of securities were steadily absorbed by the public. This meant a constant broadening of the market for securities on the New York Stock Exchange and not only was it found necessary to utilize larger quarters, but also to perfect a higher degree of market organization. The former record of 70,000 shares had gone and in its place was the million-share of this period which required new methods and new machinery. As soon as genius developed electrical means of communica- tion, telegraph instruments, telephones, stock quotation tickers, etc., became a part of the machinery by means of which the investment security business of the nation was conducted. The present elaborate wire systems of Stock Exchange members permit customers in distant parts of the country to have their business transacted on the Exchange with the same facility as residents of New York City. More than 100 members of the New York Stock Exchange reside in other cities and handle business for their customers in those sections. In the meantime, paralleling and keeping pace with the growth of the market, the Exchange expanded its code of rules and regulations requiring still higher standards of commercial honor and integrity from members in their dealings with the public. The present 22-story building occupied by the New York Stock Exchange, completed in 1922, was erected under the pressing necessity of providing additional facilities to take 36 WALL STREET care of the sudden growth of investment demand which grew out of the World War. The increased board room space which was thus provided has been still further augmented by the purchase in 1928 of the two adjoining buildings, the Blair Building and the Commercial Cable Building, giving the Ex- change about 6,000 square feet additional floor space. The Stock Exchange now controls, by ownership and long term leases, the entire city block of property bounded by Wall Street, Broad Street, Exchange Place and New Street. During 1928 and the years immediately preceding, the pros- perous condition of the country during this period has been generating new capital, in the hands both of individuals and of business institutions of many kinds. This new capital sought outlets in many different directions ; some of it flowed directly into listed security investments, while some gravitated into bank deposits (especially time but also demand deposits) with the result that American commercial banks have found them- selves as never before faced with the problem of directing the investment of capital, in addition to their traditional task of creating and lending credit for commercial purposes. In addi- tion in recent years the United States has become a creditor nation with the problems arising from the possession of this surplus capital. One million share days have long since given way to three million share days, which have been in turn super- seded by five and six million share days, and recently, (in 1929) the volume of transactions for a single day has reached the figures of ten, twelve and sixteen million shares. In 1900 the number of bond issues listed on the Exchange was 839 and of stocks 377. By 1915 this number had increased to 1,096 issues of bonds and 511 issues of stocks, while by 1929 the number of bond issues had increased to 1,540 and the number of stocks listed to 1,200. 37 CHAPTER II Order Department ORDER DEPARTMENT To the casual observer the order department appears to con- sist mostly of noise and confusion, but to the order clerk there is very little of either as he has accustomed himself to concen- trating on the particular phone he is working to such an extent that he is unmindful of the noise about him. He does not see any confusion but quite the opposite as the order department must necessarily have an elaborate system and one that will stand up under the strain of big business. It is in this department that contracts are made and must be kept regardless of cost, for if one hundred shares of United States Steel should be sold at 260 in error, then the firm is short that amount, which must be bought immediately at the best price obtainable, which, let us say is 265. Therefore the firm has lost $500 on this error. It can plainly be seen that the system in this department must be as nearly perfect as possible in order to protect the firm from these costly errors, which cannot be adjusted as in the work of other departments by the transferring of figures or by the more simple method of cancelling an entry made in error. Equipment The modern order department usually consists of four wires to the floor of the New York Stock Exchange; one for the transmission of round lot orders (which are orders for 100 shares or more) ; one for the reports returning from the floor; one for the odd lot orders (that is, orders for any amount less than 100 shares) ; and one Curb wire for the transmission of orders in stocks which are traded in on the New York Curb Exchange. There is also a monitor board ; that is a switchboard, which consists of a wire to the individual customers who are in a pri- vate room in the inner office of the brokerage concern, a wire to one or two members of the firm who may have occasion to 41 WALL STREET put in orders ; also wires to various other brokers such as curb, bond, etc., who are clients of the firm. A monitor board will also sometimes connect the various houses specializing in odd lot orders. In addition, there are telegraph wires to the out of town offices. Branch Office Orders For the handling of orders from the branch offices, as a gen- eral rule the phones are so connected, or wired, that the phone in the branch office, the instrument in the main office, and the one on the floor are all on one direct line. One ring from the branch office brings the clerk on the floor in on the ’phone, or vice-versa; three rings brings the main office in on the ’phone or vice-versa. Now, for example, when the branch office wishes to enter an order, the clerk in the branch office rings the phone once and says to the clerk on the floor, “Buy 100 Steel at the market,” which, of course, is repeated back. Then the clerk on the floor immediately gives this to a broker who goes to the post and executes the order. The report is given to the floor clerk who rings the branch office ’phones and says “bought 100 Steel at 250.” After the clerk in the branch office has ac- cumulated several orders which have been executed he rings the main office and gives the report to the clerk, which, in the above case, would be, “Bought 100 Steel at 250”, the name of the customer, or in some eases the number of the customer’s ac- count. Filing and Handling Orders In order to quickly locate the orders which have been re- ceived it is, of course, necessary to have a place in which to put them, and for that purpose there are racks in which the orders are filed alphabetically according to the name of the stock. The arrangement for this usually consists of a rack in front of each phone, this rack being used for orders that come in that day. There is also, either a rack box or cabinet, which con- tains the open orders which have come in before and which are still in force, but this rack is of course separate from the rack in front of the clerk which is used for the business that mate- rializes that day. We now have the set up of the modern order department. To realize how this system operates it will be necessary to illustrate the manner in which the orders are 42 WALL STREET handled from the time a customer enters his order to the time when he receives a report on it. A description illustrating the procedure followed in executing an order follows : Let us say that James R. Brown enters an order, either by telephone or in person, to purchase 100 shares of U. S. Steel regardless of price. The order clerk writes on the “Buy” pad, as follows: 100 U. S. Steel (X) at the market, Jas. R. Brown. This order is given to the clerk operating the 100 share wire, who time stamps it, phones it to a clerk located on the Ex- change, and then puts it in the rack. The floor clerk repeats it as he writes it on a slip (which has the firm name and the booth number on it) and hands it to a broker who goes to the post where U. S. Steel is being traded in and buys 100 shares U. S. Steel (X) for Mr. Brown at 265. The broker then fills out a report and gives it to the clerk from whom he received the order. The report is transmitted to the office, the order taken out of the rack ; price filled in and the customer then informed that the 100 shares of U. S. Steel was purchased for him at 265. This executed order is then forwarded to the various other de- partments. This particular order that Mr. Brown entered is known as a “market order,” on which the customer, promptly receives a report, usually within three minutes after he has entered such an order, which, considering the number of clerks handling it and the number of operations performed in execut- ing it as it passes through the office is a remarkably short time, and indicates the efficiency of the system developed by the modern brokerage house in handling such orders, and in han- dling its routine business generally. Classification of Orders It is the varying types of orders such as Stop, Market, Limit, Day, Contingent, Good Through a Given Date, Immediate or Cancel, Cancellations, Requests for Reports, and Open Orders that complicate the work of the Order Department. A Stop Order is the one that is automatically executed when the market reaches the price specified. For instance, Mr. Brown is willing to lose $500 only on his Steel stock that he has just purchased. He therefore puts in an order to sell one hundred shares at 260 stop, which means that the first time United States Steel sells at 260 it automatically changes his stop order 43 WALL STREET to a market order and the stock is sold at the best price ob- tainable. A Market Order is described under, Filing and Handling Orders. A Limit Order is one in which the customer specifies the price. For example, Mr. Brown will purchase another hundred shares of Steel but does not wish to pay any more than $250 a share for it. He therefore places an order to buy one hundred shares United States Steel at 250. A Contingent Order is one in which the customer wishes to place another order immediately upon the execution of an order he has already placed. For example, Mr. Brown wishes to buy a third lot of United States Steel at 240 and when the order is executed he wants to sell three hundred General Motors at the market. He therefore places an order as follows : “Buy 100 shares of United States Steel at 250, if bought, sell three hundred shares General Motors at the market.” It should be noted here, however, that a Broker will not assume any re- sponsibility in connection with a Contingent Order. Good Through a Given Date Orders are self explanatory This term is applied to orders which are to be kept open through a specified date given by the customer. An Open Order is one which is in force until cancelled by the customer, these are also known as G. T. C. orders, meaning Good ’till Cancelled. An Immediate or Cancelled Order is one which is not kept in force if it is not executed immediately. Let us assume that Mr. Brown enters the following order, “Buy one hundred shares United States Steel at 260 immediately.” His order is given to a broker who finds that U. S. Steel is quoted 261 bid, offered at 262. He therefore cannot execute Mr. Brown’s order as the best offer is 262, so Mr. Brown is informed that the market is 261 bid offered at 262 and his order is cancelled. A Day Order is good only for the day it is entered. Report or Cancellation Orders — Very often customers re- quest a report or cancel their orders. For example, let us say Mr. Brown has an order in to buy one hundred shares U. S. 44 WALL STREET Steel at 260 and sees a sale printed on the tape at that price. He therefore requests a report. His request is forwarded to the specialist, who informs the broker that nothing has been done on the order, as there are other orders ahead at that price. Mr. Brown then decides to raise his limit and enters an order to “buy one hundred U. S. Steel at 260% cancel 260.” He may later cancel this order entirely. Disposition of Unexecuted Orders The various orders enumerated in the foregoing paragraphs, (with the exception of immediate or cancel orders and market orders) are given to the specialist in the stock and he is held responsible for the execution of them. At the end of the day all unexecuted orders are taken out of the racks and divided into two classes, consisting of G. T. C. orders and Day orders. The G. T. C. orders are then written on slips in duplicate, which are forwarded to the specialist, who signs and returns the duplicate, which acts as a receipt showing he has received the order. The G. T. C. orders are then written in a record book and when the receipts are returned from the specialist they are checked against the G. T. C. orders showing the date the receipt was returned. Great care is taken in the handling of these receipts as they are the only proof the firm has that the order has been entered. Occasionally when a report is demanded on an open order the specialist claims he has no order. It is then necessary to show him his signed receipt before he is willing to accept the re- sponsibility. It is the policy of some houses to treat unexe- cuted stop and limit orders as Good ’Till Cancelled, even if not specified by the customer, however, less confusion results if the house does not keep any order open unless told to do so by the customer. Open orders at the end of the day are given to a typist who sends a confirmation to the customer who also receives monthly a complete list of all G. T. C. orders the firm has for his account. Inasmuch as The New York Stock Ex- change has ruled that all open orders are cancelled by the spe- cialist at the close of business on the last day of the month it is necessary to renew orders on the first day of every month. In other words, between the broker and the specialist there is no such thing as G. T. C. orders. They are known as month orders. 45 WALL STREET Avoiding Errors in Transmission Owing to the similarity of the names and prices of the stocks, orders are very often confused when transmitted over the tele- phone, therefore order clerks are trained to be extremely care- ful in entering orders. For example, an order is entered to “Buy 100 shares Seneca Copper at the market,” the floor clerk repeats and writes, “Buy 100 Kennecott Copper at the market.” As there is a difference in the price of these stocks the error is discovered when the report comes back. In an error of this kind the firm must pay the difference between what they pay for Kennecott and what it is sold for, and must also adjust the customers report on Seneca Copper, as there has been a delay in his order while the error is taking place. This could have been avoided if the clerk entering the order had said, “Buy one hundred Seneca, S-E-N Copper at the market.” Another type of error which oecures is that which results by confusing the prices at which orders are placed. Errors of this kind may cause heavy loss to a house and should be carefully guarded against. They occur because of the similarity in the sound of a number of figures. For example, let us say that Steel is selling at 265 and an order is received to sell 500 shares at 269. The Floor clerk writes and repeats 265 instead of 269. This error frequently happens as five and nine sound very much alike. The order is executed at 265 and as the customer’s limit is 269 it would be impossible to give him this report, therefore, the firm is short 500 shares of Steel. As errors must be corrected immediately an order is put in to sell 500 shares at 269, and another order is put it to buy 500 shares at the market to cover the firm’s short position and the stock is bought at 268. This error shows the firm a loss of $1,500. Therefore in order to in- sure greater accuracy order clerks are instructed to make the price understood and to do this it is the practice to word the order as follows; “Sell 500 U. S. Steel at 269— one point less than 270.” Odd Lot Orders Odd lot orders are handled in much the same manner as round lot orders with the exception that instead of being executed by the floor broker, they are sent to the odd lot spe- cialist through the pneumatic tube system. When executed the reports return through the same means. Each odd lot firm 46 WALL STREET has a number of brokers associated with it, and each broker has a post assigned to him. These brokers are odd lot special- ists in all stocks dealt in at their post. An odd lot market order is an order to buy or sell a given number of shares from one to 99 inclusive. These transactions are executed at % (or %) away from the price of the next sale of a full lot taking place after receipt of the order by the odd lot specialist. Market orders received before the opening of the market are executed at Yg (or %) from the opening price. It sometimes happens, however, that there will be a wide, or as it is some- times called “a split opening,” when sales at different parts of the crowd occur simultaneously at different prices. For ex- ample, Kennecott Copper might have an excited opening, sales of ten thousand shares taking place immediately upon the ring- ing of the opening gong at from 90 to 91. The ticker, would re- port, “Kennecott 10,000 — 90 to 91.” A reasonable opening price between these prices would have to be decided on. In this case it would very likely be that the odd lot specialist would buy at 90% or sell 90%. An odd lot limited order is an order to buy or sell a stated number of shares from 1 to 99 at a stated price. For example, an order is given to buy 25 shares General Motors at 70. In order that this order may be executed General Motors must sell at 69% or less. If the first sale after receipt of this limited order permits of its execution, the limit is ignored and the order considered a market order. Should the first sale be 69% the order would be executed at 69%. A limit is also ignored on a limited order if the opening sale any morning permits of its execution while the order is in force. A limited order must be executed at its limit, however, when the next sale after it is received does not permit of its execution. As stated before a limited order must be executed at its limit on the next sale made at the stated price. At times, however, the next two sales following the receipt of an order may be made at prices above and below the limit stated. An example illustrating such a case, and how a limited order at a price between these two sales is handled, follows. For example an order is given to buy 10 General Motors at 70. If the first sale after receipt of the order is 70% and the next sale 69% the order is executed at 70. The same rule applies for the same reason in the case of an odd lot for sale at a limit. For example, an order is given to sell 47 WALL STREET 10 General Motors at 70. If the first price after receipt of this order is 69% and the next sale 70%, the order is executed at 70. Stop Orders A Stop Order is an order to buy or sell a stated number of shares at the market after a fixed price is reached. An odd lot Stop Order is executed at % (or %) from the first sale of a full lot which makes the stop order operative. For example an order is received reading, “Sell 10 General Motors 70 Stop.” If General Motors sells at 70% and then 70, the order is exe- cuted at 69%> but if the sale after 70% is 69%, then the stop order is executed at 69%. An order may be given to buy or sell an odd lot “at the close.” The execution of these orders is always based on the closing bid and offer and not on the last sale of the day. “At the close” means to buy or sell on the closing bid or offer. These odd lot orders are given the same careful attention as round lots but more trouble is encountered in handling them and many more complaints received. This is probably due to the fact that the majority of small traders are inexperienced. Frequently requests for better prices are received by these customers but upon investigation it is usually found that the customer has not taken into consideration the lateness of the tape and that the price given him is correct. On a busy day it is, of course, impossible for the tape to keep abreast of the market, and it occasionally runs from twenty to thirty minutes late. In other words, a sale taking place at 2 :10 is not recorded on the tape until 2 :30 or 2 :40. Let us assume that the customer placed an order at 2:10 to buy 10 General Motors at the market. At 2:30 he sees a sale at 75 and at 2:40 77. He naturally thinks his stock was bought at 75%, but as his report reads 77% he then requests a better price. It is then explained to him that the tape was twenty-five minutes late and the sale he saw on the tape at 2 :30 actually took place at 2 :05 or before he placed his order. On one particular occasion the last sale was printed 7 :05 p. m. or four hours and five minutes late. All unexecuted orders in the department, including G. T. C. orders, are checked at the close of business each day with the high and low prices in the newspaper to make sure that no order is overlooked. 48 WALL STREET Reduction of Limits on Ex-Dividend Date At the close of each day a list of stocks that are going to sell “ex-dividend” the following day is printed on the ticker. This means that the amount of the dividends will be taken off the price of the stock. This rule only affects limit orders to buy and stop loss selling orders. For example, United States Steel is ex-dividend $1.75 a share. Then G. T. C. orders are auto- matically reduced 1% by the specialist in U. S. Steel with the exception of orders that are executed as open orders on the day the stock sells ex-dividend. In such cases the 1% must be taken off by the order department before it is sent in to the specialist. Give Ups For the convenience of customers there is an arrangement between brokers whereby a customer can place an order in a different house than the one in which he has his account. These are known as “Give Up Orders.” Let us assume that Mr. Brown has his account with Smith & Smith. He enters the office of Myles & Co., located near his home, and places an order to buy 100 shares U. S. Steel at the market, giving them instruc- tions to give up Smith & Smith. The seller of the stock then delivers to Smith & Smith instead of Myles & Co. Before Myles & Co., execute the order they usually call up Smith & Smith to determine whether Mr. Brown has an account with them. 49 CHAPTER III Clearing House Department CLEARING HOUSE DEPARTMENT Stock Clearing Corporation The modern practice of financial clearance was first devel- oped in connection with the money transactions between banks in the early part of the last century in Europe. Bank clearing houses were established abroad at that time, and the clearing house of the New York banks was similarly established in 1855. The first complete system of stock clearance was inaugurated at Frankfort in 1867, and its success soon led to the develop- ment of similar systems in London, Paris, Vienna, Hamburg and Berlin. The first attempt in America to clear stocks was made by the Philadelphia Stock Exchange. The New York Stock Exchange followed some time later, and its original Clearing House was established May 17, 1892, the centennial of the first broker’s agreement from which the Exchange has developed. Prior to the establishment of its original Clearing House, the Exchange made no provision for the clearing of trades. It should be noted that the Stock Exchange clearing is more com- plicated than that of the banks’ Clearing House in that the Stock Exchange Clearing House clears both stock and money and is really an intermediate settlement, effected by off-sets, whereas the banks only clear money. Until 1892, when the Exchange established its Clearing House, each contract for the sale and purchase of a security had to be settled separately through the offices of the parties to the trade. For example, if A sold 100 shares of New York Cen- tral stock to B, and B in turn sold it to C, and C sold it to D, the deliveries had to follow the same course and a separate payment was made against each delivery. B could not finance his payment to A out of the amount due him from C and so on down the line. If A had bought 1,000 shares of New York Central from B and had sold 800 shares of the same stock to C, he would have to receive and pay for the 1,000 shares coming 53 WALL STREET to him from A, and as a separate transaction would deliver the 800 shares to C and receive payment from him. This was the condition of things in the Panic of 1873 and is said to have been the cause of the many failures and the paraly- sis that followed. The credit of devising the plan under which the Stock Exchange Clearing House was established and oper- ated is due to Mr. Frank Eames, four times President of the Exchange. The plan of the Clearing House was that each member at the close of the day sent to the Clearing House a statement of each of his transactions. If, taking his transaction in the aggregate, he was under contract to deliver 1,000 shares of New York Central and to receive 800 shares of New York Central, the double delivery which was formerly required was replaced by a single delivery of 200 shares. The contracts remained un- affected and binding upon the parties. Under the system of the old Clearing House, the 200 shares which A would deliver would be delivered to such Stock Exchange House as might be designated by the Clearing House, entirely without regard to the parties with whom he had his original contracts. He would receive upon delivery not the price at which he had made the sale, but an arbitrary price fixed by the Clearing House which in fact was always the approximate closing price for the day. Each party to the clearing would pay to or receive from the Clearing House the amount necessary to adjust the sums due to or payable by him, and the sums actually received or paid out under the orders of the Clearing House. The Clearing House effected an enormous saving both in the work of delivery and in the amount of money required to put through the transactions of a day. However, the volume of business in the Street eventually crowded the facilities af- forded by the old Clearing House. Under the old Clearing House system, a man who had 1,000 shares to receive and 800 shares of the same stock to deliver would have to finance him- self on the delivery day only for the amount necessary to pay for 200 shares, but, if a man had bought 1,000 shares of one stock and had sold 1,000 shares of another stock, he would have to find the money to pay for the thousand he had bought pending the receipt of the money for the thousand shares that he had sold. This latter condition is now taken care of through 54 WALL STREET the operations of the Day Branch of the Stock Clearing Cor- poration described later. The Clearing House only cleared active stocks which were duly designated by the Committee on Clearing House but which in volume represented 90% of the total volume of transactions, leaving the balance of stocks listed and all bonds to be settled by the old method. Through its intermediate settlement pro- cess, the Clearing House settled about 50% of the money value of the stocks traded in. If there were $100,000,000 worth of stocks traded in on one day, the Clearing House settled $50,- 000,000, leaving $50,000,000 to be received and paid for by banking credit based on day loans to members of the Exchange. Notwithstanding the accomplishment of the Clearing House, the volume of balances to be settled plus the settlement of non- cleared stocks and bonds required such an amount of bank credit and certification from the New York banks both in money value and checks necessary to be drawn and certified, that in 1912 the banks of New York insisted that the New York Stock Exchange endeavor to find ways and means to further relieve them of the credit extension and work involved. Studies were made of actual operation of European methods and a Special Committee of the Governing Committee was appointed to study and prepare a plan, which it did through the proposed organization of the Stock Clearing Corporation which began its operations on April 26, 1920. The old Clearing House of the Stock Exchange was made a part of the Stock Clearing Corporation, and designated the Night Clearing Branch, and, in all essentials, it functions ex- actly as it did before. The Stock Clearing Corporation has a capital of $500,000, all of which is owned by the Stock Exchange, and a working surplus of cash accumulated from earnings. Under the Constitution of the New York Stock Exchange, every transaction on the Floor of the Exchange must be cleared and settled through the Stock Clearing Corporation unless otherwise mutually agreed or unless in lots of less than $1,000 par value of bonds or 100 shares of stock, so that, if a member of the Exchange who is not a member of the Stock Clearing Corporation makes a trade on the Exchange, he must have it cleared and settled by a Clearing Member firm. It should be 55 WALL STREET noted that some inactive stocks, although listed on the Ex- change do not clear through the Clearing House. Members of firms desiring to become Clearing Members must contribute a sum of money to the Clearing Fund of the Stock Clearing Corporation, based on the volume of their business, with a minimum of $10,000. This Clearing Fund is at the risk of the business of the Stock Clearing Corporation, and for its protection and in addition carries 100% assessable liability, so that, in case there is a loss to the Stock Clearing Corporation that it cannot make good from its surplus, every Clearing Member is assessed pro rata up to double the amount of con- tribution. Because of this money protection, the banks of New York take the checks of the Stock Clearing Corporation with- out certification. The Stock Clearing Corporation is not a bank but is organ- ized under the business law of the State of New York to act as the agent of its members in receiving securities and in pay- ing for them and in delivering securities and receiving payment therefor. The money representing its capital, surplus and Clearing Fund is re-deposited in over twenty-five banking institutions. Furthermore, for the protection of the Stock Clearing Corpor- ation and its members, those who join it must sign what is known as the Clearing Member’s Agreement, giving to the Stock Clearing Corporation power to see that the member’s business is properly conducted at all times and to take such steps as it deems necessary for its protection and the protection of its members. Each member of the Exchange who employs the Stock Clear- ing Corporation to act for him is credited by the Stock Clearing Corporation each day with the amount he is entitled to receive for securities deliverable by him and is charged with the amount he is obligated to pay for securities deliverable to him, and he receives or pays the balance through the Stock Clearing Corporation. In connection with the work of the Stock Clearing Corpora- tion there exists a central delivery department through which brokers may receive and deliver securities bought and sold without the necessity of separate delivery to the individual brokers involved in the transactions. On all clearing transac- tions other than those resulting from what are known as three- 56 WALL STREET way tickets the receipt and delivery of securities are made through a central delivery department. The effect of the operations of the Stock Clearing Corpora- tion may best be indicated by the use of figures. In transac- tions which, before the creation of the old Clearing House, would have required $100,000,000 to effect the settlements, and, under the operations of the Clearing House, would have re- quired only $50,000,000, now, under the operation of the Stock Clearing Corporation, require only about $20,000,000. This means that the operations of the Stock Clearing Corporation diminish every day by enormous amounts the actual money required to effect the settlement of Street transactions. As only one check is received from a firm to balance its account with the Stock Clearing Corporation or the Stock Clearing Corporation delivers such firm a check for a similar purpose at the end of the day, the saving in the number of checks drawn and certified is very large. On one day, the Stock Clearing Corporation settled the day’s transactions by the use of only 340 checks which, if it had not been in opera- tion, would have required the drawing and certifying of 19,775 checks. To illustrate as a concrete case, one Stock Exchange firm owed $1,980,000 on stocks to receive and had credit of $1,975,000 of stocks to deliver involving 163 deliveries and about 150 receipts, all of which were settled with a check for $5,000. All of this is undertaken through the medium of the Day Branch, which is, in reality, a settlement department as against the Night Clearing Branch being a clearing organization. Another function of the Day Branch is the clearing of loans. Prior to its inauguration, if a member firm desired to pay off a loan at Bank A for $100,000, it had to secure certification from its own bank on a day loan for a check drawn to the order of Bank A. Later in the day, if it borrowed the money from Bank B, it received a check from Bank B which it de- posited in its own bank to make good the credit given to the house by its own bank. At the present time, when a bank calls a loan of $100,000, it brings the securities to the Stock Clear- ing Corporation which gives its check for the face value of the loan and interest and either holds the securities until a new loan is made or allows the firm to receive them and deliver to parties purchasing them on sales made the day before. 57 WALL STREET When the firm makes a new loan, it either brings new securities to the Stock Clearing Corporation or uses those in its possession and they are sent for by the representatives of the lending bank by 2 :30 P. M. In addition to settling the balances of the cleared securities as the result of the operations of the day before, the Day Branch settles transactions in bonds and non-cleared stocks. On May 31, 1923, there was also placed in operation what is known as the Stock Transfer Department which issues to mem- bers its assignable transfer receipts for stocks to be placed in transfer and on September 20, 1926, inaugurated the issuance of its exchange receipts issued for the deposit of securities in connection with re-organizations and re-adjustments of capital. Both classes of receipts are accepted by the lending banks of New York as collateral in the same manner as they receive the stocks. This operation results in the release to members of a large amount of credit which would otherwise be tied up for twenty-four hours or more until new stock can be received from transfer or exchange and has proved of great benefit to the members. Under this plan, members can take securities from loans and deliver them to the Stock Transfer Department together with blank powers of attorney making the new stock negotiable and on receipt of the assignable receipts can replace the stock as collateral in the loans. The expense of the operation of the Stock Clearing Corpora- tion is met by three sources of revenue. First, a charge of five cents per hundred shares on each side including balances of stock entered on the night clearing sheet. Second, a charge of two cents per $1,000 of money value settled through the Day Branch. Third, by interest received from banking institutions with whom it deposits its capital, surplus and the money in the Clearing Fund. The operation of clearing loans and the Stock Transfer Department are free to members and are part of the service of the Stock Clearing Corporation renders as a depart- ment of the Exchange. The auditing of the operations of both the Day and Night Clearing Branches are in the hands of a department under the direction of the Assistant Treasurer where is concentrated the routine work of auditing, collecting charges from members, and the continuous check and reconciliation of bank balances. This is an entirely separate department and was organized and 58 WALL STREET operates on the same principles as the auditing departments of large corporations. Owing to the tremendous value of negotiable securities going through the premises of the Day Branch, a very complete guarding system is in existence and the premises are protected in the most modern way possible. No employee of a firm is admitted to these premises without having an identification card with his picture thereon and his having filed a complete history sheet that is duly investigated and passed upon by The Division of Records and Investigations. There is no clearing on Friday, as that day’s transactions are combined with those of Saturday and cleared on Saturday. Detail Operating Methods and Practices of the Brokerage House in Connection With Its Clearing Work The following pages will present the methods and practices of clearing house work in detail, showing, with examples and forms, the manner in which this work is actually handled by the brokerage house. To simplify the explanation of this work we are setting up the entire transactions for one day for the Stock Exchange firm of Cox & Company, and in connection therewith will show each of the operations performed in the handling of the Clear- ing House transactions for this day’s business. These transac- tions are as follows : BOUGHT : February 1, 1929 No. of Name of Shares Stock Price Broker from Whom Bought 100 U. S. Steel 180 Smith & Co. 200 11 11 183 Redding & Co. 500 n ii 184 Jenkins & Co. 200 Studebaker 96 White & Co. 300 11 95i/ 2 Logan & Co. 200 Erie 63 Bigsby & Co. 100 General Motors 431/2 Harold & Co. 59 WALL SOLD: No. of Name of Shares Stock 400 U. S. Steel 200 Studebaker 400 100 300 Radio 100 General Motors STREET Price Broker to Whom Sold 186 Wood & Co. 94i/ 2 Stone & Co. 97 Peters & Co. 9ey 2 Hardy & Co. 45 Thompson & Co. 44 Hearst & Co. The reports covering these transactions will be sent from the Order Clerk to the Clearing House Department, and will also include the names of the customers who purchased and sold. The names of the brokers with whom the transactions were made, however, are not available until some time later in the day. These names are obtained by sending a messenger to the Exchange for the floor reports which are matched up with the reports received from the order room. In order to assure the accuracy of the Clearing House Sheet which is sent to the Night Clearing Branch it is necessary to confirm each transaction appearing thereon. We will, however, present here this sheet in its completed form, but will explain the transactions in the order in which they occur in the actual handling of the work. 60 WALL STREET 61 Figure 1. Clearing House Sheet WALL STREET Confirming Each Transaction Referring to the bought or receiving side of the Clearing Sheet it will be noted that we have seven transactions. On each of these transactions a Receive Ticket, printed in black on yellow paper, will be made out covering each of the pur- chases made, and in the case of the item on line 1 of the Clear- ing Sheet the ticket will cover a purchase of 100 shares of U. S. Steel to be received from Smith & Company. The following form shows this ticket prepared to cover this transaction. Form M4 No.. 3ft- Our Line Number- New York. 7y .192 9 STOCK CLEARING CORPORATION (BHT cimm MM) RECEIVE FROM / 170 shares llajm. for account of the undersigned. Their Line Number- _j£Z_ /£D.—*JJLQiUL Figure 2. Receive Ticket The sales are handled in exactly the same manner, except that the ticket used in transactions involving sales is printed in red ink on white paper, and is known as a Deliver Ticket. Form No. 3, which follows shows the Deliver Ticket prepared for the transaction covering 400 shares of U. S. Steel sold by Wood & Co., as indicated on line No. 51 of the Clearing Sheet. 62 WALL STREET Form M5 No.iM^L ° ur STOCK CLE.A DELIVER T l-l OD Khniva Line Number — New York 192 ^ .RING CORPORATION onw cairns bbikch) 0 ^ yf/J V^T/r. yf (oi / ft & $ — for acoount of the undt Their Line N 'srVxi' r ^ umber Figure 3. Deliver Ticket The sellers deliver ticket (Figure No. 3) is provided with a detachable duplicate upon which the Federal and State tax stamps are placed. The duplicate is sent by the delivering broker to the Stock Clearing Corporation on or before 11 :00 o’clock the day following that on which the trade was made. When all the tickets are completed they are sent to the Stock Clearing Corporation and exchanged for tickets representing the opposite side of each transaction. For example, Cox & Company will receive from Smith & Company a red and white deliver ticket covering the item on line No. 1 of the Clearing Sheet and will receive a yellow and black receive ticket from Wood & Company, covering the transaction shown on line No. 51 of this sheet. It is obvious that when each ticket is exchanged that the transaction is absolutely accurate. However, it sometimes hap- pens that owing to errors or mixups on the floor of the Ex- change, resulting from a large volume of business, that the tickets cannot be properly exchanged at the Stock Clearing Corporation. In such cases it is necessary to send a messenger to the other party in the transaction and demand the proper ticket in exchange. A form called a “Demand” is used in this contingency. Referring back to the Clearing House Sheet, and to line No. 1, let us assume that Cox & Company did not receive the De- liver Ticket of Smith & Company. Cox & Company would then fill out the Demand notice, as follows : 63 WALL STREET Form Ml 2 We give up Don't know .transaction with Your ticket stopped with us. This demand when presented af “Original” ticket, signing as a “i or by returning demanding party’ to Night Clearing Branch with sh Name and Number Stamp pou. | Name and Number Stamp er 4 :30 P. M. (Saturday 1 :30) must be recognized by issuing an >ubstitute” ticket, or signing as a “Give Up” or “Don’t Know” notice, ticket if in your possession. Demanding party must send his ticket ;et when stamped as “Substitute”, “Give Up” or “Don’t Know”. STOCK CLEARING CORPORATION. New York U./r-' 107 <7 CORPORATION (Km cleamg branch) J&g.tr. No.v2££L STOCK CLEARING To. DEMAND is hereby made for your DELIVER ticket in exchange for our Receive ticket Substitute for our ' J " Name and Number Stamp Figure 3-A. Demand for Ticket In the event of Smith & Company wishing to “give up” the transaction to another broker they would stamp their name and clearing house number on the line reading, “Your ticket stopped with us,” and write the name of the “give up” broker on the line reading, “We give up.” Cox & Company would then take the Demand to the “Give Up” and receive a regular deliver ticket. If for any reason Smith & Company disclaim the trade, either through being unable to locate the ticket of Cox & Company, or through having no record of the trade, they would stamp their name and clearing house number on the line reading, “Don’t know transaction with you. Your ticket stopped with us.” This would automatically “cut out” the transaction from the night sheet. 64 WALL STREET If the trade is correct according to the records of Smith & Company they would give Cox & Company either the regular deliver ticket or stamp their name and clearing house number on the last line of the form and place their line number in the space after the words reading, “Substitute for our Deliver ticket No. . Original stopped with you.” In the Clearing Sheet which we have shown there are seven purchases and six sales. When the sheet is sent to the Night Clearing Branch it must be accompanied by seven white and red deliver tickets from Smith & Company, Redding & Com- pany, and the other firms enumerated on the sheet down to line No. 7, and by six yellow and black receive tickets received from Wood & Company, Stone & Company, and the other firms represented on the deliver side of the sheet down to line No. 56. Security Balances to Receive and Deliver The next duty of the clearing house clerk is to analyze the sheet so that he may arrive at what stocks he is to receive and deliver on balance. It will be noticed that 800 shares of U. S. Steel were purchased (Lines Nos. 1, 2, and 3) and that 400 shares were sold (Line No. 51), leaving a balance of 400 shares to receive at the established Clearing House price of 185 (Line No. 59). Further analysis will also show that 200 shares of Erie are also to be received, and that 200 shares of Studebaker and 300 shares of Radio are to be delivered. Note also that 100 shares of General Motors purchased and 100 shares sold offset each other, making an even position with no balance either way. Having arrived at the above, balance to Receive and Deliver tickets must be made out accordingly and sent to the Night Clearing Branch with the Clearing Sheet. The same color scheme is used throughout, that is, receive on yellow and black and deliver on red and white. Examples of the forms used in connection with this work follow : 65 WALL STREET Form MS STOCK CLEARING CORPORATION (NIGHT CLEARING BRANCH) THE UNDERSICNED WILL RECEIVE FOLLOWING BALANCE OF STOCK AT THE DELIVERY PRICE. SHARES STOCK RECEIVE FROM 7-00 ft/ Zs/'/Z./zq M1 . MF 'X?ty .. Figure 4. Receive Balance Ticket Form M7 STOCK CLEARING CORPORATION (NIGHT CLEARING BRANCH) THE UNDERSIGNED WILL DELIVER FOLLOWING BALANCE OF STOCK AT THE DELIVERY PRICE. I SHARES STOCK DELIVER TO 1^00 llJJtul DATE Figure 5. Deliver Balance Ticket 66 WALL STREET It will be seen from these forms that the Clearing House tickets have a blank space allowing for the insertion of the name of the broker from whom stocks are to be received or to whom they are to be delivered. The names of these brokers are subsequently inserted by the Clearing House Corporation and returned to the broker the following morning. We have previously mentioned the fact that the Clearing House established a settlement price which is approximately that of the closing price of the day. The manner in which the Clearing House settlement price is arrived at is indicated by the following illustration : For example, if United States Steel closed at 185% the Stock Clearing Corporation price would be 186, but if it closed at 185% the settlement price would be 185. In other words when the fraction exceeds % the settle- ment price taken is the next higher flat price and where the last sale for the day is fractionally less than % the settlement figure taken is the next lower flat price. Where, however, the last sale is at the even half fraction the Stock Clearing Cor- poration would use their judgment in establishing the price, basing it according to the trend of the market. These prices are used for balancing purposes only and entail no loss of money to either the receiver or the deliverer of the security, notwithstanding the settlement made by check or draft at the settlement price. Money Differences The different prices at which the stocks may be bought and sold and the Clearing House price result in a difference in money to be paid to the Clearing House or received from it. In the case illustrated it will be noted that the total of the credit side of the Clearing Sheet is $3,050.00 more than the total amount on the debit side of the sheet. Accordingly a draft is made out for this amount. This draft also accompanies the Clearing House Sheet. If, however, the debit side were larger it would be necessary to send a check to the Clearing House for the required amount. The cheek is drawn to the order of The Manhattan Co. A form showing the draft used in this connection is presented below. 67 WALL STREET • Z w // CWMtJiNCi . (. / Z-/Z//.J. ritf ■ * * 1 iiuusi ^ f Figure 6. Night Clearing Branch Draft The Clearing Sheet, of course, should be properly balanced both as to securities and money. The individual handling this work must be extremely careful in all details as each error is subject to a fine. It is also a more or less flexible rule that the Clearing Sheet together with all Receive and Deliver tickets, Receive and Deliver Balance tickets, and check or draft must reach the Night Clearing Branch by 7 :00 P. M. However, this time is usually extended under the stress of a large volume of business, but if the delay is unreasonable a fine is likely to result. No clearing of transactions takes place on Friday night as the trades of Friday and Saturday are combined and cleared in one day, namely, on Saturday. For the purpose of this book we have used the full name of the security in making up the Clearing House Sheet. The Clearing House, however, has ruled that the symbol for each stock must be used in all cases. For instance, United States Steel must be placed on the Clearing House Sheet as “X”. Day Clearing Branch The Day Clearing Branch, as far as the receipt and delivery of securities is concerned, is used mainly for transactions that were “cnt” from the Night Clearing House sheet on account of disputes or for other reasons which prevented proper clear- ance on the Night Branch, and for securities which are not on the clearing list and for most of the bond transactions. (Ex- cluding certain convertible bonds). 68 WALL STREET Day Branch tickets are sent to the parties on the other side of the trade and the form used in this connection is known as a Three-Way ticket, a specimen of which is shown here, desig- nated as Figure No. 7. Oil-t-w mi Clearing N (ltoHveric Idol lor LJoe No. DellTcrin* Member a » Blotter Line No. if (Receiving Member) Securities not entered on previous Night Clearing Sheet Stock Clearing corporation (DAY BRANCH) New York, _ 192. (Receiving Member) Share* Bonds Security Prloe Value 1 L the undersigned will deliver the above To (Nam# and Number 8tarap of Receiving Member) for account of the undersigned (Mem# of OelKrertn* M.ml-nO Figure 7. Three-Way Ticket This ticket, as its name indicates, is made up in triplicate, the seller sending it to the buyer who stamps his O.K. on the original and duplicate and retains the triplicate for his own record. Lists made up from these tickets together with the original and duplicate on each transaction are sent to the Stock Clearing Corporation Day Branch and deliveries are subse- quently made by deliveries of the securities against receipt. The receipt is then sent to the Clearing House Day Branch for proper credit on the final adjustment check. This matter is taken up completely in the chapter devoted to the Cashier’s Department. The foregoing covers merely the operations involved in pre- paring the Night Clearing House Sheet. There are, however, a number of other operations which are usually included in the work of the Clearing House Department under the direct supervision of the Head Clearing House Clerk. Of these opera- tions we will consider first the preparation of the clearing house blotter. 69 WALL STREET Clearing House Blotter The Clearing House Blotter is practically a duplicate of the clearing house sheet excepting that commission, interest, tax, total debit or credit to customer and name of customer are included. Following is the form of Clearing House Blotter based on the clearing house sheet discussed in the previous paragraphs. COX be Co. Feb 2 , t<)Z9. 0 fl O HER No From Whc-m Bought q».«M T Description Price Amount Commj TofM Fo* A ctt. ~1 1 ion 11 S. Steel . ffio 1 ft 000 25. IfKUlS Z 2.00 11. S Steel Ift3 36 000 50 i 3 500 II S. Steel 1 fit <] loco i 2 5 92/25 n L*. White &. Co ZOO StudcbaVtr lOZon to. 112 tQ 3oo lift 26450 6 » 0 . 2 fl 7 /o ( zoo Erie r„,t 1 2 . 6,00 12 6,35 ) 7 1 oo 1 3 A A ?50 .15. 436$ _2_ 4_ xon VaKer qU iff flofl i* «oo XI. io cU. 300 V? £X d 1 o •4-4 1 3 XaO 13200 Y? ( ( D rafT 30SO 305'0 <«?. fi ( z i ^ ~ / ZfOO Fo 2 t 6 ; 800 _7 W ZJ Figure 8. Clearing House Blotter 70 WALL STREET It will be noted that the customer’s commission is added on the debit side and that the commission and tax is deducted on the credit side, the figures under column “Total” representing the net debits and credits. The commission on both debit and credit sides are brought over in one amount to the credit side of commission account. In order to bring the clearing house blotter into balance it is necessary to include the security balances and draft appearing on the clearing house sheet. These items are marked C.H. (Clearing House) and are non-posting items as the contra entries will be found on the deliver and receive blotters used in the Cashier’s Cage. It is the usual custom for one clerk to prepare the clearing house sheet, and for another to handle the clearing house blot- ter. These clerks work entirely independent of each other and thus when the same result is reached the accuracy of both clearing house sheet and blotter is assured. In former years all postings by the bookkeeping department were made directly from this and the ex-blotter used in the Cashier’s Cage. However, during the last few years the volume of trading has increased to such an extent that improvements have been made in several departments. A great many of the houses today put through their records with slips which are made out at the same time as the customer’s confirmation. Duplicates of the confirmation under this system are sent to the Margin Department, Stock Record Department, Book- keeping Department, etc. In this explanation of both the clearing house sheet and blotter we have assumed that all orders were executed by the floor member of Cox & Company. However, as a matter of fact a very large portion of the business is given out to other brokers, and in this case the name of the executing broker would appear in the extreme left hand column of the forms shown in Figures No. 1 and No. 8. 71 WALL STREET Curb Clearing House Sheet and Blotter All transactions in 100 share lots executed on the New York Curb Exchange are handled in exactly the same manner as New York Stock Exchange transactions, providing that the stock is on the clearing list. The exchange of tickets, prepara- tion of Clearing Sheet and Blotter are handled practically in an identical manner. The Curb market has a night clearing branch only and the security balances to receive or deliver are made by actual deliv- ery and payment by the brokers indicated on the security balance tickets. Customers’ Confirmations Every trade made by a customer is confirmed by mail on the same day the transaction takes place. The confirmation shows the day of trade, broker, number of shares, description or name of security, price, interest if a bond transaction, com- mission, tax and the net debit or credit to the account. Follow- ing are examples of the forms generally in use. 72 COX % o VALUE *:*. i * * * v % r\ X V v 0 ^ a s cv ^ ,0 * S A > /v\ >- *- > . 13 2 0. V $ Q * > * jO » 5- ^ o A * . *> 5 5: v> e § * ’’i iM 1- • i • • • 8 OC < X n 0 o v» ^ •i R V * ^ 'b •> ■s. j VALUE DELIVER TO s V V A 1 A o S * s s -X V 's * * -> V • T5 tv. >0 *) *** 0*^ oo. VJs^ o $ • H 2 i i 1 vL n & *L *> 0 1 V 8 1 \ ' 5 ? k <5 o'’ * 0 a 0 1 to OC y J 1 1 75 Figure 11. Odd Lot Sheet WALL STREET It will be noted from this sheet that there are seven different purchases and eleven different sales, a total of eighteen tran- sactions, involving securities to be received and delivered, and to be temporarily financed if the special sheet were not in use. The completion of this sheet, however, results in two actual deliveries, that is, 110 shares of Radio and 10 shares of Ameri- can Can, and one receive transaction, that of the 10 shares of General Motors. The money difference is shown in one check for $5196.25 to be received from the odd lot specialist. If either the broker or the specialist is unable to make the deliveries as indicated on the sheet the value of same is allowed for in making the final settlement check. For instance if Cox & Company could not deliver the 10 shares of American Can the check from Carlisle, Mills & Co. would be reduced approxi- mately $1,000.00, this being the value of the 10 shares of Amer- ican Can. This matter of the receipt and delivery of stock and the adjustment check is also explained fully in the chapter devoted to the Cashier’s Department. Ex Blotter Items Every brokerage concern, whether or not they are members of an exchange, will have customers who are interested in and who trade in unlisted securities and other securities for which no clearing arrangements or special sheets can be made. These items are simply listed on what is called the Ex Blotter, the form used being the same as the Clearing House Blotter. After the trades are listed on the Ex Blotter by the Clearing House Department it is sent to the Cashier’s Cage, who receive and make actual delivery of all items thereon, receiving the proper payment or making disbursement as each particular item requires. Stocks Borrowed and Loaned A record of all securities borrowed and loaned is kept by the Clearing House Department. The clearing house sheet we have shown includes only actual purchases and sales. However, securities loaned and borrowed, mark up or mark downs and securities returned may also properly appear on the sheet, and the receive and deliver tickets are exchanged in the usual manner. For instance, should Cox & Company borrow 100 76 WALL STREET shares of American Can from Wilkins & Co. it would appear on the receive side of the Cox & Co. sheet and on the deliver side of the Wilkins & Co. sheet. Unless some other mutually satisfactory arrangement was made between the two brokers the item would be figured at the Clearing House price. Cox & Company may continue to borrow the 100 shares of American Can for say, 5 days and at the end of this time wishing to return this stock to Wilkins & Co. they would so notify them by telephone and would place the return item on the deliver side of the sheet. This would also be at the borrowed price unless it were marked to a different price during the 5 day period, but the amount of interest due Cox & Company would be added. Let us assume that the borrowed price was $99.00 and the interest $9.00. The amount placed on the deliver side of the sheet of Cox & Company and the receive side of the sheet of Wilkins & Company would be $9,900.00 plus $9.00, or $9,909.00. Carrying this illustration further let us say that at the end of the 5 day period American Can had declined to $90.00 and that Cox & Company desired the stock to be marked at this price. After notifying Wilkins & Company they would place the return on the credit side of the sheet at $9,909.00 and would create a new borrowed item by placing the 100 shares on the receive side at the present price of $90, or $9,000.00. These two items automatically create a credit of $909,00 to Cox & Company and the mark down is thus accomplished. The record of stocks borrowed and loaned is kept in such a manner that the interest can be readily adjusted to any change in rate. Following is an illustration of the method in general use. STOCKS BORROWED DATt AMT TiESCRiPnov PRICE y* V7 */v / oo d"MA. J&AXA 7? y/y fU t>0 v h loo (%+•*** ?o 3'A Figure 12. Stocks Borrowed Record 77 WALL STREET The foregoing- sheet shows the original borrow of the stock at $99.00 with changes of interest on February 4th and Febru- ary 5th; the return of the item on Febx-uary 7th and the new transaction at the market price. Securities loaned are handled in exactly the same manner, excepting that as Cox & Company loaned the stock they would pay the interest instead of receiving it, providing there was no premium. The short and quick method of figuring interest on stocks borrowed and loaned is exactly the same as explained in the chapter on the Cashier’s Department detailing the work of the Loan Clerk. When Issued Transactions There are many securities traded in on a when, as and if issued basis. That is to say they are dealt in before the actual certificates are ready for delivery. This usually occurs as a result of mergers, reorganizations, organization of new corpor- ations, the issuance of stock subscription privileges, the ex- change of securities, etc. These trades are executed in the regular manner wherever the market might be located, that is, on the New York Stock Exchange, New York Curb Exchange, Over the Counter Mar- ket, et cetera. When the reports of such transactions reach the Clearing House Department they are properly recorded, usu- ally on a card system, giving the name of the broker, the num- ber of shares, price, customer, etc. The transactions are then compared in the regular manner, but in view of the fact that a stamped comparison is not binding in a court of law a special form of contract is signed by each broker in the trade to assure the accuracy thereof and to establish a binding contract. For the purpose of this book we will consider only such transac- tions as have been executed on either the New York Stock Exchange or the New York Curb Exchange. The form of contract in use for these transactions follows. 78 WALL STREET 3j*a ^ •lj)i«3j3i[ jaquinu oj 3uipuodssjiOD joejjuod w AN Vd WOO $ XOO 1° CI3AI3D3y 79 Figure 13. When Issued Contract WALL STREET This when issued contract would be delivered to Wilkins & Company, who would date and sign the receipt attached. Wil- kins & Company would also send a contract to Cox & Company covering their sale of this stock and would receive the signed stub. On the Clearing House Department devolves the duty of watching the market on all When Issued securities so that in the failure of either of the exchanges to put through an inter- mediate sheet the securities can be marked to the market price. For instance Wilkins & Company having sold Cox & Company 100 shares of Baldwin Locomotive at 64%, and the market having declined to a serious extent Wilkins & Company would have the privilege of marking down the stock. However, if this item is on a when issued basis it could not be handled through the Clearing House, but would be consummated by Cox & Company giving a check to Wilkins & Company for the required amount. However, when When Issued trades reach a considerable volume of trading and the market has advanced, or declined to any marked degree the Clearing House will order an inter- mediate sheet. This order requires that all clearing members having transactions in this stock must put in a sheet covering each trade. The Clearing House then establishes a price and all shares to be received or delivered on balance are figured at this price. For illustration let us say that Cox & Company have pur- chased 1600 shares of Baldwin Locomotive, when issued, at various prices, averaging perhaps $65.00, and have sold 3100 shares at the same average price, leaving a net short position of 1500 shares. Further assuming that the market has declined to $50 per share, Cox & Company have a paper profit of $22,- 500.00. At this stage of the proceedings the profit is not pro- tested in any way, and furthermore in the case of the failure of any of the brokers to whom they sold the stock Cox & Com- pany would be subject to a serious loss. The intermediate sheet affords this protection and at the completion of the sheet Cox & Company would have 1500 shares of Baldwin Locomo- tive to deliver at the new price of $50.00, and the profit of approximately $22,500.00 would placed to their credit at the Clearing House completion. Interest is also allowed on this sum at the prevailing rates. 80 WALL STREET The method of preparing the sheet is exactly the same as in the case of trades made in the regular way. The when issued records are kept up until such time as the issuing corporation makes the stock available for delivery, at which time the Exchange will also designate an official delivery date. Referring back to our illustration, Cox & Company at the completion of the intermediate sheet have a balance of 1500 shares of Baldwin Locomotive stock to deliver, but subsequent to that time they may have made many additional trades. When the delivery date has been announced by the Stock Exchange the 1500 shares to deliver and all subsequent shares of 100 share lots or multiples thereof will be placed on the regular night clearing house sheet previous to the announced delivery date. It has sometimes occurred that securities traded in on a when issued basis have been withdrawn or cancelled by the issuing corporation. In this event all trades are entirely cancelled and if intermediate sheets have been put through the money is returned by the Clearing House Corporation. Many instances have also occurred when owing to the long duration of trading on a when issued basis and wide fluctuations in the market price that several intermediate sheets have gone through on one issue. The Clearance of Convertible Bonds Effective November 25, 1929 the Stock Clearing Corporation announced that all transactions made in certain convertible bonds would be cleared on a special sheet to be delivered to the Night Clearing Branch. At the time of publication the following issues are affected : Name Abbreviations Alleghany Corp. Col. Tr. Conv. 5’s, 1949 AYY ’49 Alleghany Corp. Col. & Conv. 5’s, 1944 AYY ’44 Am. I. G. Chemical Corp. 51 / 2 % Conv. Deb., 1949 81 AIG 51/2 WALL STREET Am. Int’l. Corp. Conv. 5%’s, 1949 AL 5^ Am. Tel. & Tel. Conv. Deb. 4%’s, 1939 ATT cv 4y 3 Atchison, Topeka & Santa Fe Conv. Deb. 4 1 / 2 ’s, 1948 A4y 2 Commercial Investment Trust Conv. Deb. 5%%, 1949 CIT 5y 2 Dodge Brothers, Inc. Deb. 6%, 1940 DEE 6 General Public Service Conv. Deb. 5y a ’s, 1939 GPV 5y 2 Int’l. Cement Co. Conv. Deb. 5’s, 1948 ICM 5 Int’l. Tel. & Tel. Conv. Deb. 4i/ 2 ’s, 1939 ITT cv 4i/ 2 Mo. Pacific R. R. Co. Conv. 5%’s, Series A, 1949 MOP 5% N. Y. N. H. & Hartford Conv. Deb. 6’s, 1948 Vcv 6 Phila. & Reading Coal & Iron Co. Conv. Deb. 6’s, 1949 PRC 6 Porto Rican Amer. Tobacco Co. Conv. 6’s, 1942 PRT 6 Public Service Corp. of N. J. Conv. Deb. 4y 2 ’s, 1948 PUB 4y 2 Richfield Oil First Mtgs. & Col. Tr. Ser. “A” 6% Conv., 1944 RIL 6cv So. Pacific Conv. 5’s, 1934 SX cv 5 Texas Corporation Conv. 5’s, Deb., 1944 TX 5 RTC Chicago, Mil., St. Paul & Pac. Adj. 5’s, 2000 ST. AJ 5 Missouri, Kan. & Texas Adj. 5’s, 1967 KT. AJ 5 Chicago & Northwestern R. R. Co. Conv. 4%’s, 1949 NW. cv. 4%’s 82 WALL STREET The Stock Clearing Corporation will probably follow out its usual method of procedure, that is, to start with a few issues and as the system develops and proves itself will add to the issues until practically all active convertible bonds will be cleared. Presented below is a copy of the circular SCC-742 issued by the Clearing House Corporation in this connection. General Instructions for Clearing Only transactions in the above mentioned convertible bonds made on the floor of the Exchange “Next Day” but not trans- actions traded in “Seller Contract” shall be included in these clearances. Only IM bonds and multiples thereof will be cleared. Use only official abbreviations on sheets and tickets. Both contracts and balances must be entered without interest (flat). Contracts must be entered on one or more pages and security and cash balances on separate page. Exchange tickets must be exchanged not later than one hour after the Distributing Department time for exchanging tickets on cleared stocks. 3-way tickets must NOT be used. Demand Tickets must be recognized when presented after the “last call” for Convertible Bond Tickets has been made. FAILURE TO COMPLY WITH A DEMAND TICKET WITHIN A REASON- ABLE TIME WILL BE SUBJECT TO A FINE. Special stationery will be required for use in regard to the special clearances for the convertible bonds listed above. Call for a supply of this stationery at your Day Branch cage on November 25th, before 11 A. M. Delivery prices on these convertible bonds will be printed on stock tape immediately after delivery prices of stocks. These bond clearances will be carried out in the same manner as the ordinary night clearances of cleared stocks except that the delivery of sheets and the dating of the sheets must be made in accordance with the following table : 83 WALL STREET 1 . 2. 3. For Transac- tions of : Deliver your sheets to Night Clearing Branch by 11 A. M. Date your sheet, tickets, check or drafts as of ; Monday Tuesday Wednesday Tuesday Wednesday Thursday Wednesday Thursday Friday Thursday Friday Monday Friday Monday Tuesday Saturday The security balance orders will be ready for you at the Night Branch at 9 A. M. on day shown in column three above and you must deliver convertible bonds on balance through the Central Delivery Department before 2:15 P. M. on that same day. You must also settle your account at your cage in the Day Branch on that same day. It will be noted from the preceding table that the delivery of transactions in the above mentioned convertible bonds WILL NOW BE DELAYED FOR ONE DAY. For debit cash balances, shown on Night Branch sheet, send check drawn to order of BANK OF MANHATTAN COMPANY For credit cash balances, as shown on sheet, send draft. Drafts will be ready at 12 o’clock noon on the day on which sheets are dated. Great care should be used in making entries on sheets, ex- change tickets and balance tickets, checks and drafts and in seeing that they are entered on the stationery supplied by Stock Clearing Corporation for this purpose. Fines for errors or omissions will be enforced in the same manner as in clearances of cleared stocks. 84 WALL STREET DAY BRANCH INSTRUCTIONS Resulting balances of the above mentioned convertible bonds to receive and deliver on Stock Clearing Corporation, Night Clearing Branch security balance orders with accrued interest (which will be computed by each Clearing Member from table of interest which will be sent out daily with your security balance orders by the Stock Clearing Corporation) will be settled through the Day Branch on the date of settlement of each clearance, but the itemized list for the convertible bonds must be separate and distinct from all other itemized lists. Actual delivery shall be made through the Central Delivery Department before 2 :15 P. M. on day shown in column 3 of date table on previous page. Note: — The same rules and principles, so far as applicable, shall govern these special clearances including matters con- nected therewith arising out of the insolvency of a party there- to as in the case of regular clearances and the judgment of the Stock Clearing Corporation as to the applicability of such rules and principles shall be conclusive on all parties concerned in all respects. A supplementing circular, SCC-745, issued by the Stock Clearing Corporation as of Nov. 26, 1929, provides that if a balance to deliver resulting from a clearance of convertible bonds is not delivered on the date of delivery, fail to deliver notices shall be exchanged and the bonds thereafter must be delivered directly between members but settlement shall be made through the Day Branch of the Stock Clearing Corpora- tion on three-way tickets and appropriate entries must be made on the respective debit contingent and credit contingent lists. On all such fail to deliver transactions in cleared convertible bonds, interest shall be computed down to the day when de- livery should have been made in accordance with the terms of the original contract. As a result of the convertible bond clearance, delivery of transactions in such bonds will be delayed for one day and in- terest should be computed for all purposes to the date when de- livery is to be made in accordance with date table in circular SCC-742. 85 WALL STREET Attention is called to the sentence in circular SCC-742, read- ing: FAILURE TO COMPLY WITH A DEMAND TICKET WITHIN A REASONABLE TIME WILL BE SUBJECT TO A FINE. The exchange of tickets, demand notices and security bal- ances are handled in exactly the same manner as the Clearing House Sheet covering Stock Transactions excepting that the bond sheet will be dated two days after the actual transaction and that actual receipt and delivery of securities will be two days later. The receive and deliver tickets and the balance to receive and balance to deliver tickets are also in exactly the same form as used on Stock Clearances. The color of the tickets however has been changed somewhat, all deliver tickets being printed in dark red ink on pink paper, and the receive tickets printed in black ink on light blue paper. It should be noted particularly that the items on the con- vertible bond clearance sheet are figured without interest. The interest is not figured until the security balance tickets are returned with the name of the receiving or delivering broker inserted. Furthermore the interest is figured to the date the bonds actually cleared which is two days later than the transaction excepting of course on all such transactions as are carried over the week end and holidays. The table in- cluded in the circular of instructions for clearing, covers this matter thoroughly. The convertible bond clearance sheet is a big step forward in expediting bond deliveries. It will eventually cut down to a very small minimum the transactions formerly handled on the Three Way sheet. Particular attention is also called to the fact that the convertible bond sheet together with tickets and draft or check is deliverable to the Night Clearing Branch at 11:00 A. M. of the day following the transaction. (See column two (2) in table). 86 WALL STREET COMMISSION BILLS The Clearing House Department must also keep the record of commissions due other member brokers for trades executed in 100 share lots or multiples, the odd lots being handled with- out cost by the odd lots specialist. Of course a great many of the transactions are handled by the firm’s own floor repre- sentative but the volume of trading in busy markets makes it impossible for one or two men to handle the firm’s business. The orders are therefore given out to other brokers and the name of the executing broker appears upon the floor report and is also placed in the designated column on the Clearing House Sheet. The usual method of keeping this record is to sort the floor reports in alphabetical order and enter them in a properly indexed book usually reserving a page for each broker. The bills are payed usually by the first and tenth of the month at the following rates : STOCKS From $1.00 to $9% $1.25 per 100 shares From $10.00 to $124% $2.50 per 100 shares $125 and over $3.00 per 100 shares 87 CHAPTER IV Margin Department MARGIN DEPARTMENT The Margin Department of a Brokerage Office serves the most important purpose of providing a ready and quick refer- ence as to the condition of all customers’ Cash and Margin Accounts. This Department should at all times be prepared to state definitely and accurately the position and equity in any Customer’s Account. The word “Equity” when applied to Securities means the amount of money the customer would have if his securities were liquidated at the current market prices. Duties The Margin Department’s work consists of : 1. Keeping each customer’s position and equity as mentioned above. 2. Approving the entering of all orders to buy and sell where there is any question as to the existence of sufficient equity in the account. 3. Sending out margin calls. 4. Entering Stop Loss orders to protect the firm from loss. 5. Approving withdrawals of cash, or Stock by customers. 6. Checking position and Money Balance on all Statements sent to customers by the Bookkeeping Department. Source of Information The Margin Clerk must be well informed on all transactions pertaining to a Customer’s Account. His Accounts are built up from the following entries : a. Purchase and Sale of Stocks and Bonds. b. Money Deposits and Withdrawals. c. Securities Received and Delivered. d. Dividends (Stock and Cash) Rights and Coupons. e. Interest Charged or Allowed on an Account. f. Puts and Calls. 91 WALL STREET Methods of Figuring There are two principal methods of figuring individual Mar- gin Accounts: One is where the value of the Tong’ securities, Debit or Credit Balance, and the Equity are shown ; the other is where only the ‘long’ and ‘short’ securities, the market price and the equity are shown. The latter method, with the addi- tion of keeping the ledger balance, is the only one used on those accounts known as ‘Wire Accounts.’ These are accounts of other brokerage houses either out of town, or local, who do their trading through another house. Wire accounts usually carry a large number of different securities and this latter method is usually employed for such accounts as it is quicker and less complicated. The idea underlying either method of figuring margin is to show what equity or credit would be left in the customer’s account if the long securities were sold and the short securities covered (bought) at the current prices shown on the margin card. The Margin Department may keep its individual accounts on either cards, sheets, or silicate slates, but the method of figur- ing is the same. The Wire Accounts are usually kept on sili- cate slates due to the great number of securities that are carried. Examples of Ledger Balance Method The following examples of individual accounts show the first method, i. e., using the debit or credit balance and the exten- sions of the securities. Mr. X buys 100 Coca Cola @ 145, costing $14,500 plus $25 commission making a total of $14,525, and deposits $8,500 as margin. The first thing to do is to arrive at Mr. X’s money balance. The stock cost $14,525 which is a debit, less $8,500 credit which leaves a debit balance of $6,025. Now the Margin Clerk enters on the margin card, as follows: Mr. X. 100 Coca Cola 145 $14,500 Debit Balance 6,025 $8,475 Equity 92 WALL STREET Suppose the market price of Coca Cola declines to 140. Only the equity would be changed, as fluctuations in prices of se- curities do not affect the money balance in an account. The margin card would now show : Coca Cola 140 $14,000 Debit Balance 6,025 Equity $7,975 Mr. X buys 100 Arnold Constable @ 28 . . . $2,815. This is a debit and increases the debit balance from $6,025 to $8,840. The margin card appears as follows : 100 Coca Cola 140 $14,000 100 Arnold Constable 28 2,800 16,800 Debit Balance 8,840 Equity $7,960 Now Mr. X sells 100 Sinclair Oil @ 35^ . . . $3,550 less $15 commission and $2 State, and $2 Federal tax, leaving a credit of $3,531. This credit reduces his previous balance of $8,840 to $5,309. This short trade is entered on the right hand side of the margin card and the value of the short stocks is deducted from the value of the longs. The margin card would then show as follows : 100 Coca Cola 140 100 Arnold Constable 28 $14,000 100 Sinclair Oil 36 $3,600 2,800 Shorts 16,800 3,600 Debit Balance 13,200 5,309 Equity $ 7,891 93 WALL STREET This equity of $7,891 means that if Mr. X sold his long stock he would be credited with $16,800, and if he covered his short stock he would be charged $3,600, which would leave a net credit of $13,200. The account shows a debit balance previously of $5,309 which, after the closing out of all his holdings would leave an equity or credit balance of $7,891, less commission and tax for buying and selling, and the interest charges. Mr. X now deposits $3,000 as additional margin. This would reduce his debit balance from $5,309 to $2,309. His card would then show as follows : 100 Coca Cola 140 $14,000 100 Sinclair Oil 36 $3,600 100 Arnold Constable 28 2,800 16,800 Shorts 3,600 13,200 Debit Balance 2,309 Equity $10,891 Mr. X sells 100 Hartman B 32-% . . . $3,193.50. From this credit of $3,193.50 deduct his previous debit balance of $2,309, which leaves a credit balance of $884.50. The margin card would then show the following record: 100 Coca Cola 140 $14,000 100 Arnold Constable 28 2,800 100 Sinclair Oil 100 Hartman B 36 $3,600 32 3,200 Shorts 16,800 6,800 $6,800 Credit Balance 10,000 884 Equity $10,884 In almost all brokerage houses, the margin department dis- regards the pennies in figuring the balance and equity. The 94 WALL STREET above example shows that if all the longs were sold and the shorts covered the customer would have a credit of $10,000 plus his credit balance of $884, making his equity the total, $10,884. Mr. X now sells 100 Coca Cola @ 141^, $14,121. This credit increases the previous credit balance of $884 to a new credit balance of $15,005. The margin card would now show : 100 Arnold Constable 28 $2,800 100 Sinclair 36 $3,600 100 Hartman B 32 3,200 $6,800 Longs 2,800 $4,000 Credit Balance 15,005 Equity $11,005 The above example shows that if Mr. X sold his long stocks and covered his short stocks at the above prices the result would be a debit of $4,000, and as his account shows a credit balance of $15,005, his equity would be the difference, $11,005. Mr. X now withdraws $5,000 from his account, which reduces his credit balance to $10,005, and his equity to $6,005. Mr. X requests that the 100 shares of Arnold Constable that he is long be transferred to his name and delivered to him. Assuming that there is sufficient equity to warrant his trans- fer, the Margin Clerk will make out instructions to transfer 100 shares Arnold Constable to Mr. X’s name. These instructions are passed on to the Cashier’s cage. His margin card now would show : 100 Arnold Constable. . .Tfr (date) 100 Sinclair 36 $3,600 100 Hartman B 32 3,200 6,800 Credit Balance 10,005 Equity $3,205 95 WALL STREET As soon as the instructions are given, the Margin Clerk then erases the value and price that were shown previously against the stock. By putting no value on the stock and marking it Tfr, showing that it is in transfer, the equity is automatically reduced $2,800, which was the value put on the stock before. When the stock has been transferred and delivered to Mr. X, the Margin Clerk simply erases the stock, which was long, from his margin card. This erasure does not alter the rest of the ac- count since no value was put on the stock. The margin now appears as follows : 100 Sinclair 100 Hartman B 36 $3,600 32 3,200 Credit Balance 6,800 10,005 Equity $3,205 Mr. X now sends to the broker, directly or indirectly, 100 shares of Sinclair and withdraws $5,000 from his account. This transaction would appear on the Receive Blotter as “100 shares Sinclair received for account of Mr. X for $5,000.00.” This $5,000 may either appear on the Receive Blotter or on the Cash Sheets. This debit of $5,000 reduces the credit balance to $5,005 and the 100 shares of Sinclair received will cover the 100 shares which were short. The margin card will now show : 100 Hartman B Credit Balance 32 $3,200 5,005 Equity $1,805 Mr. X delivers to his broker 25 shares of International Mer- cantile Marine, directly or indirectly, without withdrawing any money. His account would now show long of the stock, and the Margin Clerk would then enter the stock with the market price on the card. 96 WALL STREET The card would show as follows : 25 International Mercantile M. 32 $800 100 Hartman B Longs 32 $3,200 800 Credit Balance $2,400 5,005 Equity $2,605 Mr. X now buys 100 Hartman B @ 35 . . . $3,515. This debit of $3,515 reduces his credit balance of $5,005 to $1,490 and the purchase covers the short of 100 Hartman B. The margin card now appears as follows : 25 International Mercantile Marine Credit Balance 32 $800 1,490 Equity $2,290 As there is enough equity to fully pay for the 25 shares of International Mercantile Marine, the Margin Clerk would show the stock fully paid with a credit balance of $1,490 as follows : 25 International Mercantile Marine Credit Balance $1,490 Now if the customer wanted to close his account he would have the 25 shares of International Mercantile Marine deliv- ered to him and receive from the broker a check for $1,490 less interest charges on his account. Eliminating the Ledger Balance The following examples will show the other method of figur- ing margins, under which method the card shows only the 97 WALL STREET number of shares long or short, the price, and the equity. In illustrating this method we will follow the same account as previously shown. Mr. X buys 100 Coca Cola @ 145, costing $14,500 and $25 commission, making a total of $14,525, and deposits $8,500 as margin. 100 Coca Cola 145 Equity $8,475 By entering the 100 Coca Cola at 145, the Margin Clerk is figuring that Mr. X will receive $14,500 for the sale of the stock. As the stock cost $14,525 there is a loss of $25 which reduces the equit from $8,500 to $8,475. Now suppose the market price of Coca Cola declines to 140. This is a loss of 5 points on 100 shares, which makes $500. This loss is deducted from his equity of $8,475, making the equity now $7,975. The margin card would show : 100 Coca Cola 140 Equity $7,975 Mr. X buys 100 Arnold Constable @ 28, $2,815. Entering the stock at 28 ($2,800) which shows a loss of $15 and accord- ingly reduces his equity to $7,960. The margin card would show : 100 Coca Cola 140 100 Arnold Constable 28 Equity $7,960 Mr. X sells 100 Sinclair @ 35 y 2 , $3,550, less commission and tax amounting to $19, leaving a credit of $3,531. This short trade is entered on the card, say at 36. This means that the stock would cost $3,600 to purchase (cover). Since Mr. X only received $3,531 for the sale of the stock and the Margin Clerk figures it would cost $3,600 to cover it, there is a loss of the 98 WALL STREET difference amounting to $69. His previous equity of $7,960 is reduced to $7,891. The margin card would show : 100 Coca Cola 140 100 Sinclair 36 100 Arnold Constable 28 Equity $7,891 Mr. X now deposits $3,000 as additional margin. This would increase his equity from $7,891 to $10,891. The card would now show : 100 Coca Cola 140 100 Sinclair 36 100 Arnold Constable 28 Equity $10,891 Mr. X now sells 100 Hartman B @ 32 Yg, $3,193.50. This short trade is entered on the card, say at 32 (3,200). Figuring the stock would cost $3,200 to cover, and as Mr. X only received $3,193 for the sale, his equity would be reduced the difference, $7, which now makes his equity $10,884. The margin card would now show : 100 Coca Cola 140 100 Sinclair 36 1 00 Arnold Constable 28 100 Hartman B 32 Equity $10,884 Mr. X now sells 100 Coca Cola @ 1411/3 ($14,121.) The Margin Clerk had figured that Mr. X would only get $140 a share, $14,000, when he sold the stock. Instead Mr. X received $14,121. The difference of $121 is a gain which increased the equity from $10,884 to $11,005. The margin card now shows : 100 Arnold Constable 28 100 Sinclair 36 100 Hartman B 32 Equity $11,005 99 WALL STREET Mr. X now withdraws $5,000 from his account, which reduces his equity to $6,005. Mr. X requests that 100 Arnold Constable which he is long be transferred to his name and delivered to him. Assuming that there is enough excess equity, the Margin Clerk will give instructions to make the transfer. As the Margin Clerk had valued the stock at $2,800 this would decrease the equity from $6,005 to $3,205 as the Margin Clerk, after giving instructions to transfer the stock, cannot place any value on it. The margin card would show : 100 Arnold Constable. . .Tfr (date) 100 Sinclair 36 100 Hartman B 32 Equity $3,205 When the stock is transferred and delivered to Mr. X the Margin Clerk simply erases the 100 shares of Arnold Constable he was long, which does not again affect the equity. Mr. X now delivers 100 shares of Sinclair to the broker, directly or indirectly, and withdraws $5,000. The Margin Clerk had figured that the stock would cost $3,600 to cover, instead of which there was $5,000 paid out. This difference of $1,400 would decrease his equity from $3,205 to $1,805. His margin card would show : 100 Hartman B 32 Equity $1,805 Mr. X now sends to the house 25 shares of International Mer- cantile Marine, directly or indirectly, without withdrawing any money. Assuming the stock is selling @ 32 (value $800) this would increase the equity from $1,805 to $2,605. The margin card would now show : 25 International Mercantile Marine 32 100 Hartman B 32 Equity $2,605 100 WALL STREET Mr. X now buys 100 Hartman B @ 35, $3,515. The Margin Clerk had figured that Mr. X would only have to pay $3,200 when he covered the short of 100 Hartman B, instead of which he had to pay $3,515. The difference of $315 is a loss and is deducted from the previous equity of $2,605, making it now $2,290. The margin card would now show : 25 International Mercantile Marine 32 Equity $2,290 As there is enough equity to fully pay for the 25 shares of International Mercantile Marine, the Margin Clerk would show the stock fully paid for, and a credit balance of $1,490 by de- ducting the value of the long stock, $800, from the previous equity of $2,290. His margin card would now show : 25 International Mercantile Marine Credit Balance $1,490 Wire Accounts In the handling of wire accounts the same principle as out- lined in the second method for figuring individual accounts is applied, but on a much larger scale. In addition, the ledger balance is recorded on the slate above the amount of equity. This balance, as explained in method one, for figuring indi- vidual accounts is only changed when funds, no matter what they are for or where they are from, are charged or credited to the account. The Margin Clerk enters on large sheets, or they are entered for him by an Extension Clerk, the stocks and bonds purchased and sold during the day by their correspondent. At the close of the day’s business the Margin Clerk foots the sheets to de- termine whether the correspondent bought or sold stocks on balance. If they bought more than they sold, he must increase 101 WALL STREET their ledger debit balance by this amount. If they sold on balance, then he must reduce their debit balance. This differs slightly from the individual method, whereas, in individual accounts the ledger balance is changed as soon as a trade is entered in the account. If he were to change the balance with every trade in a wire account, he would have to make at least fifty to a hundred changes a day. The idea then of listing the purchases and sales on a sheet, is not only to save time, but also to reduce errors to a minimum. At the end of the day, after he has posted all the blotter items and changed his ledger balance due to the day’s trading, the Margin Clerk must then ascertain the market value of his shorts and add it to his ledger debit balance, listing the short value and the ledger balance separately. The total of these are used for determining the marginal requirements on the ac- count, which is explained fully in the following chapter on requirements. The Margin Requirements The three principal methods of figuring margin requirements are as fallows : (a) At a specified percentage of the market value of the stock being carried. (b) At a splendid number of points for stocks selling be- tween certain prices. (c) At a specified percentage of the debit balance. The first two methods are used for figuring requirements on individual accounts, and the third method is used for wire accounts. Percentage of Market Value The percentage required is usually 35%. Under this method if a customer were long 100 Radio selling at $100 a share, and 50 shares of General Motors selling at $40 a share, the total value of the two stocks would be $12,000 — Figuring 35% of $12,000 would be $4,200. This $4,200 would be the margin re- quirement at 35%. 102 WALL STREET Required Number of Points Each brokerage house has its scale of points, the average requirement being as follows : Stock selling under $10.00 a share Cash Only yy between 10-20 ” yy 7 points yy yy yy 20-30 ” yy 9 yy yy yy yy 30-40 ” yy 13 yy yy yy yy 40-50 ” yy 17 yy yy yy yy 50-60 ” yy 21 yy yy yy yy 60-70 ” yy 25 yy yy yy yy 70-80 ” yy 29 yy yy yy yy 80-90 ” yy 33 yy yy yy yy 90-100 ” yy 35 yy yy yy yy 100-150 ” yy 40 yy yy yy over 150 yy special arrangements Therefore, as indicated previously, where a customer has 100 shares Radio selling at $100 a share, the requirements on a point basis would be $3,500, which is 35 points as shown in the above table. On 50 General Motors selling at $40 a share, he would require 17 points a share or $850, making his total marginal requirements $4,350 for both stocks. Percentage of Debit Balance On wire accounts the average percentage is 30%. As pre- viously mentioned, the Margin Clerk must always keep on his slate, the ledger debit balance, plus the value of the short stocks, if any. It is on these figures that the 30% is figured to obtain the requirements. For example : If there are no short stocks, and the ledger debit balance is $400,000, the margin requirement would be $120,000. If the account has a ledger debit balance of $350,000 and the shorts amount to $50,000, the total would be $400,000 and the margin requirements $120,000. When a stock is sold short, there appears on the ledger, what is termed, “A False Credit,” which reduces the ledger debit balance by the amount of the sale. We must, therefore, add to 103 WALL STREET the ledger debit balance the total of the shorts, to get a true debit balance, upon which to figure requirements. There are sometimes cases where the shorts exceed the longs. Then in the first two methods you would figure the require- ments on the shorts, the same as you would do on the long stocks. In the third or last method, where the shorts exceed the longs you would naturally have a ledger credit balance, instead of a ledger debit balance, so the margin requirement would be 30% of the value of the shorts. Approving Orders (Weak Accounts) At times customers give orders to purchase additional shares of stock when there is a doubt as to whether there is sufficient equity in the account. In such cases the Margin Clerk must determine if there is enough equity to warrant putting the order in and if there is, he will approve the entering of the order. Margin Calls When there is a decline in the market value of the holdings of a customer to a point where the equity in his account no longer satisfies the margin requirements, then the Margin Clerk calls for additional margin. This is known as a margin call. The exact wording of a margin call varies, but it is generally to this effect “Due to the depreciation in the value of the securities we are carrying for your account, we are in need of $5,000 as additional margin. Kindly forward a check for this amount to bring your account up to the proper requirements.” After making margin calls the Margin Clerk must keep proper memorandums of these calls to make sure that the customers respond. Should any customer fail to answer the margin call, the Margin Clerk should then take the matter up with the head of the department. Stop Loss Orders If after repeated margin calls, there is no additional margin provided by the customer, or in case there is a violent change in the market where there is not sufficient time to notify the 104 WALL STREET customer to put up more margin, the Margin Clerk places stop orders on the customer’s securities. These orders are generally placed at a price as near to the exhaust of the margin as pos- sible without the broker taking the risk of sustaining any loss. Take for example, the following account on the margin card : 100 Jewel Tea 65 100 Park & Tilford 45 Equity $1,200 As the above account only has six points margin, the Margin Clerk enters stop orders to sell 100 Jewel Tea @ 62, and 100 Park & Tilford @ 42. These stop orders are entered on sell- order-slips and given to the Order Clerk. At the same time the Margin Clerk notifies the customer as follows: “Pending the receipt of a check for $2,300 as additional margin, we have placed the following stop loss orders on your account to “Sell 100 Jewel Tea @ 62, and 100 Park & Tilford @ 42.” The Margin Clerk would now change the card as follows: 100 Jewel Tea 62 Stop entered(date) 100 Park & Tilford 42 Stop entered (date) Equity $600 Should the Margin Clerk receive the check from the cus- tomer before the stop orders are executed he will then cancel these orders to sell. Once these orders are entered, the Margin Clerk need no longer worry about the account. Withdrawal of Cash or Securities If a customer wishes to withdraw cash or stock from his account, these withdrawals must be passed upon by the Margin Clerk. The Margin Clerk must first ascertain whether there is enough excess equity to warrant such withdrawals. It is very important that, before a new account is closed or money drawn from it, the Margin Clerk should make sure that the check originally deposited, when the account was opened is 105 WALL STREET valid. There have been cases where a customer has opened an account, depositing as margin an out of town check, and before the check had been cleared has closed his account, and in a day or two the check has been returned unpaid. When a customer buys securities for cash, in other words paying for them in full, the Margin Clerk must make sure that these securities are fully paid for before passing instructions to transfer them or deliver them to the customer. Verification of Statements At the end of the month the Bookkeeping Department ren- ders monthly statements to all customers, and occasionally, upon special requests renders statements during the month. Before these statements are mailed to the customers, they are checked by the Margin Department. The Margin Clerk, since he does not figure interest himself, first changes his balance and equity in accordance with the interest debited or credited on the customer’s statement. He then checks the money balance and position with his margin card. In case he has a difference in the money balance, the Margin Clerk, before mailing the statement checks up with the bookkeeper to find who is in error. Should there be a difference in the position, the Margin Clerk will refer to the stock record book to see whether he or the Bookkeeper is correct. After all the statements are checked by the Margin Department, they are passed on to the Mailing Department. Other Important Details Some of the important points to be kept in mind in properly maintaining margin accounts are as follows: (1) Keep memorandum of instructions regarding securities to be delivered or received. (2) When a stock sells ex-dividend, make note of the stock and the amount to be credited to the account when the dividend is payable. An unpaid dividend helps to strengthen an account when the margin runs low. If the customer is short of a stock which sells ex-dividend, the Margin Clerk must make note to withhold such amount, in case the account is closed before the Dividend Clerk makes a charge for same. 106 WALL STREET (3) He must reduce his sell stop price on his margin card or slate, when a stock sells ex-dividend, as the Order Clerk automatically reduces the original order. (4) Do not pay a customer for the sale of a stock sold out of town until you have been paid by the broker who purchased the stock from you. The reason being, that stocks are some- times in transit two or three days, and if the wrong stocks were sold, or the stock certificates were worthless, the cus- tomer would have had time to cash the check and leave for parts unknown. (5) Make note of the date and the amount of checks cashed for a customer in order to guard against his closing the account before his checks are cleared, in case the checks are returned to you by the bank and prove to be worthless. (6) Be posted as to customer’s wishes regarding stockrights in his account. A subscription to additional stock is figured in the same manner as a regular purchase, and margin must be figured on it. (7) Check in Order Clerk’s open order book at least once a week, to see whether there are any orders still in, for an account which has been closed, and the open orders not can- celled. (8) The customer’s name should appear on each account. This is needed in case of a margin call, or where information is required regarding the account. (9) When a customer has all of his securities paid for, and he wishes to leave them with the broker, the Margin Clerk must then instruct the Loan Clerk to put these securities in safekeeping for the customer. (10) A customer very frequently enters a stop loss order on a security, in answer to a margin call, or to reduce his margin requirements in order to take on additional stocks. These stop orders must be entered on the margin and checked fre- quently, to make sure that they have not been conceded or changed. (11) If a customer should buy and sell a “When Issued Stock” at a profit, do not apply his profit as margin on other trades, or pay the profit to him if he should close his account before the stock is regular. But, if he bought and sold at a loss, make sure he has sufficient margin to take care of the loss. 107 WALL STREET The reason is that the trades or transactions in the stock may be nullified if the plan for the new stock is not approved. Margin calls are not usually made unless the customer’s equity falls below twenty-five (25%) per cent of the firm’s margin requirements. The Margin Clerk must be familiar with the market price and abbreviations of all active stocks. When the Market is rapidly declining he must constantly refigure his accounts dur- ing the day, at the same time making margin calls and at the end of the day after the close, he must refigure all of his accounts at the closing prices, and make whatever additional calls are necessary. When a new account has been opened by a purchase of some security (with no money deposited), which may occur where the account has been approved, and the deposit is to be sent later on, the Margin Clerk must make a memorandum to make certain that the deposit is received in the specified time. Accuracy The primary requisite for a good Margin Clerk is accuracy. He must recheck all his calculations before making any changes on his margin cards, as there is no check on his work, except when statements are rendered, or when he occasionally refers to the ledger to check any account on which he suspects he might have made a mistake. Unless a Margin Clerk is very careful he may let a customer overtrade or allow an account to go in debt, or close an account when not justified, thereby causing the firm to suffer a loss. When an account has been closed out by mistake, it is necessary for the firm to reinstate the account by repurchasing the securities sold in error or sell- ing the stocks bought in error. This may cause a loss due to the market price having changed in the meanwhile. The Mar- gin Clerk must familiarize himself with all his accounts. He must know which are his weak long accounts in order that he may turn to them first in the case of a decline in the market, and which are the short accounts in case of a rise in the market. The number of “short” accounts is small compared to the number of “long” accounts. He must also know which accounts have excess equity so that in case a customer desires to pur- chase additional stock there will be no delay in approving the order. Such delay should be avoided because the market is changing at all times. 108 CHAPTER V Bookkeeping Department BOOKKEEPING DEPARTMENT The Bookkeeping Department of a brokerage office is con- fronted with the necessity of keeping its work up-to-date, under all conditions. This is necessary as the books are subject to reference at all times, and must be in such condition that the status of a client’s account may be known at any time during the day and may be given to the client promptly upon his request. While the volume of work in a brokerage house may be heavy at times the variety of transactions is rather limited and the greater proportion of these transactions are clean-cut and rather simple to handle. The bookkeeping system and methods of the brokerage house are accordingly quite simple, and well standardized. In contrast to the bookkeeping work of a commercial house, there are no such items as freight rates, freight bills, insurance, and other transactions of a similar character which tend to complicate the bookkeeping work of a commercial house. General Principles The double-entry system of bookkeeping is used, and in the handling of cash transactions the regular principles of debit and credit are employed in making such entries. Security items, however, are recorded in the opposite manner. For in- stance, if a customer buys a security or delivers a security to his broker, it is placed on the debit (or receiving side of the account) while securities sold or delivered are entered on the credit (or delivery side) of the account. The following example shows a few typical transactions, without interest being charged. The handling of interest transactions will be fully explained in later paragraphs. John Smith, a customer of Otis & Company, buys 100 U. S. Steel at 233 plus $30 commission and deposits 200 shares of Anaconda stock as margin, and requests actual delivery of 50 shares of the Steel purchased. The entries and the statement at the end of the month, would be: ill WALL STREET o of fH d d o fl <1 S * p 2 M PQ oo i oo *3 M . ' © >• ' s ° pd o ' O rH I d d *d m o CO t» b- io O 05 o 55 0 {-4 1 fa =3 Ph 14 1 u « $ + bu n' ^SPh (d r;^ SO go; S§\3 >^o O g'wg'S S' fc*> d d © fa © o o PQ rH d a 118 WALL STREET The above statement shows that on May 1st Mr. Anderson bought 100 Am. Power & Light at 107%, $10,712.50 plus $25 commission, making a total of $10,737.50. On the same date on the credit side under date of May 1st is an entry of a cheek for $6,500 which is the amount the customer deposited as margin. On the 10th is a sale, (which is on the credit side,) of 100 Am. Power & Light at 106, $10,600 less commission and tax, $29.00 leaving $10,571 to be credited to the account. On the 20th Mr. Anderson buys 100 Corn Products at 95%, total $9,570. The figuring of interest on these transactions is handled as fol- lows : On the first purchase from May 1st to May 31, there is charged 30 days at 6% which amounts to $53.68. On the pur- chase of May 20th to May 31, there is charged 11 days interest which amounts to $17.55 ; giving a total of debit interest charged amounting to $71.23. The credit side shows as of May 1st a check for $6,500, on which interest is allowed to the end of the month, which is 30 days and amounting to $32.50. On the 10th is shown a sale amounting to $10,571. On this item from the 10th to the 31st of the month 21 days of interest is allowed, amounting to $37. The total amount of credit interest is $69.50. To balance the interest account we proceed as follows: The total of the debit interest amounts to $71.23, and the credit in- terest amounts to $69.50, therefore, the difference the customer would owe at 6% would be $1.73. This balance of interest ($1.73) is shown on the credit side of the statement in the interest column. The rate to be charged is 8%. By dividing $1.73 by 3, we obtain the interest at 2%, which amounts to $0.58. This added to the $1.73 gives us the interest at 8%, amounting to $2.31. This amount is charged under date of May 31st, and the account is now ready to balance for the month. The total debit amount after charging $2.31 for interest for the month amounts to $20,309.81, while the credits amount to $17,071. The difference between these two amounts is $3,238.81, which appears on the credit side of the statement after item of “Balance.” This balance of $3,238.81 is now brought down on the debit side of the statement under date of May 31st. Under this bal- ance is recorded the long stock, 100 Corn Products. This means Charles Anderson, on May 31st, owes the firm $3,238.81, but is long 100 Corn Products. 119 WALL STREET Checking Out Security Position After posting a sale transaction, the position should be al- ways checked off. For example, on the sale recorded for the date of May 10th, 100 American Power & Light there is a check mark after the 100 and also a check mark after the pur- chase of 100 shares bought on May 1st. Where numerous trades are made during a month some method of keeping a record of the position of the account is necessary, that is, whether long or short, and to what extent the account may be long of short. This is called “Checking a position.” All securities remaining unchecked on the debit side at the end of the month would be in the long position and would be carried over in this position at the beginning of the statement for the following month. The following statement will show Mr. Anderson’s account after he had sold his 100 shares of Corn Products stock. Dr. Chas. Anderson In Account with Wall & Co., Brokers Cr. Date Amount Days Int. Date Amount Days Int. May 31 Balance .. 3238.81 30 16.19 100 V Corn Prod., Long. June 30 Int. 6% + 1 % Carrying Chg 13.31 Balance .. 6323.88 9576. 16.19 June 27 100 V Corn Prod., 96. 9576. 3 4.78 Bal. Int.. 11.41 9576. 16.19 June 30 Balance. 6323.88 Figure No. 15 120 WALL STREET Balancing the Statement Continuing with the foregoing statement from May 31st, the customer is shown with a debit balance on May 31st of $3,238.81 and long, 100 Corn Products. On June 27th the Corn Products was sold at 96, the net credit being $9,576. The interest charge for 30 days on the debit balance of May 31st, is $16.19, while on the sale amounting to $9,576 on June 27th in- terest for three days is allowed, amounting to $4.78. The bal- ance of interest at 6% amounts to $11.41. The brokerage firm is charging Mr. Anderson, 7% interest. Therefore, to obtain the interest at this rate you divide $11.41 by 6 to get 1% and add this amount to the $11.41, which gives the interest at 7%, amounting to $13.31. This amount is charged as of June 30th. The money credit amounts to $9,576, and the debits amount to $3,252.12, so the difference to be entered on the debit side under the heading of “Balance” is $6,323.88. This balance is now brought forward on the credit side under date of June 30th, which shows that Mr. Anderson now has a credit in his account of $6,323.88. Closing the Account The following statement shows where Mr. Anderson, on July 12th, decides to withdraw whatever money he has in his account. Dr. Chas. Anderson In Account with Wall & Co., Brokers Cr. Date Amount Days Int. Date Amount Days Int. July 12 Check .. Bal. Int.. 6330.20 12.65 June 30 July 23 Balance . Int. 3%.. 6323.88 6.32 12 12.65 6330.20 12.65 6330.20 12.65 Figure No. 16 121 WALL STREET On the credit side of the foregoing statement the balance under date of June 30th, is shown as $6,323.88 ; as the account is to be closed on July 12th, the interest will be figured on 12 days at 6%, which amounts to $12.65. The brokerage house is allowing Mr. Anderson 3%, so he is credited under date of July 12th with interest at 3%, $6.32. This added to his credit bal- ance of $6,323.88 gives a total credit of $6,330.20. This amount is entered on the debit side of the statement, under date of July 12th, as check $6,330.20, which transaction closes the account. The statement is then given to the Margin Depart- ment to be checked. Short Sales The statement presented on the following page shows the account of a customer with long and short transactions. When a customer sells securities short, he is not allowed interest on his short trades. However, if the stock is bought (covered) during the month, he is charged with interest from the date of purchase to the end of the month, and on the short sale he is credited from the date the stock was purchased or covered, but not from the date it was originally sold. In other words, when the stock is covered and he is “charged” interest he is allowed the same number of days interest on the sale. When a customer sells short and does not cover before the end of the month, no interest is allowed. Ini some instances when a cus- tomer sells short in 100-share lots, he is allowed a special rate of interest. This is determined at the end of the month and would be a separate entry having nothing to do with the other inter- est items in the account. 122 Louis Singer In Account with Wall & Co., Brokers WALL STREET t-i o s-. P o3 Q pi P o a <1 a P ca P Pi pi o a ca P rH CO 00 CO CO O 0* O CO oi ffl CO IH CO o > “ ^ aj c- ^ ^ ^ ° o a o ® ° ^ o ^ o ^ Q ffl H ffl If5 cq CD CD O PH PI ^ o3 n§ CO co co Tti t- ca 0 to t>- lO 01 CO co CO > f— I O > vOO O CC^ O CM rH O a c$ o co be i — i * > a o p> vOO O ic^ o ^ T— I E" be « co >> Pi a o d ^ o hO§ CO # p o* cd o co o co co co , 05 io co t-i o > cS Q d d o B <1 73 03 Q d d o a 03 o H CO O iH rH cS a C O '3 id d ^ ee p* «o aj o ^ ^ pq Tfi co O ffl co 3 •“D bJD <1 00 CO © ; O LO 00 CO C~ CM rH rH 43^ > 3 t— O- be o o (M O ^ r—j -l CO HQ • S rd d p :o g • ^Eh 43 d : 43 O d S OB 3 o o PQ i-H i-l OO be «3 be d H o GO o ,rH ~ GQ £2 a> S ’g 43 £ d *.£$ •3S 43 5r! m 43 r- j 5 | ISH 5 d T3 ° O £ d & 43 > _o o ^ o > I *2 ^ m ° £ o <1> 4J a M 03 -+-> 03 -H d bend d ^ ‘o ” be ^ W !h ■d ^ 'd C/2 o ^ 43 125 allowed on the $26,000 from the covering date August 7th to the end of the month, which is 24 days, and which amounts to $104.00. The account now shows as of August 31st, a balance of $12,077.71, and that customer is long 100 Continental Can, and 100 Union Tank Car. Figure No. 18 WALL STREET PQ ■U A • Ph v !© d 00 _ — >j' — "TO 05 .... ® ->• ° to -~i m Sr' • ce ” ce " d • rH >- rH > < . . -a • © be : s' :| bi g • o S Cl . be O . cs ® flO'3’2 dO JT 03 mo>PPQ GQ O Cvl CO O L" lO rH C\1 <0 =3 a*«S 1 o o O P fl be ; Lr d « ° g ®0 © © © © © © 02 ^g 20, rH >( © Ai • r cl • ,o S : § =8 '« d m £ -a o d «

. iH A xn '> u > M ■ be ■ B ■ 3 • o 3 « d Al ' o 3.Z q •<3 : m IN £ O ° :£ „Ph m rW £ « aw g S 0 °>°>' . -S > w 50 £ rH r* LO 126 100 Kress Co. Short. 9800. 83991.70 205,68 '83991.70 205.68 Sept. 30 Balance 4001.70 Sept. 30 100 Kress, short * 9800. 75 Congoleum Long 150 Elec. Pow. Lt. WALL STREET On the debit side of the statement shown in Figure 19, under date of September 6th, appears the entry, 100 Lehn & Fink re- ceived, no money ; and on the same day, debit side, check $4,381. These entries interpreted, mean that Mr. Smith delivered to the broker or (had his bank or another house deliver to the broker for his account) 100 shares of Lehn & Fink stock and received a check for $4,381. The stock was received on the 6th and as Mr. Smith or his bank receive the check for $4,381, this amount is charged to his account. On the credit side under date of September 6th, we have the entry 100 Lehn & Fink sold at 44, $4,381. This is a cash trans- action and there is no interest figured on the debit and credit amounts of $4,381, as they are both on the same day. However, where a customer has a margin account and also makes out- right purchases or cash trades, the interest is usually figured on all items, which, however, does not affect the net results, pro- vided the money is paid on the same day the stock is purchased. Under date of September 10th we have the entry, 100 Sears- Roebuck received, no money, and the next item is a check for $15,671. On the credit side under September 7th, we have 100 Sears-Roebuck sold short at 157, amount $15,671. The receipt of the stock on the 10th covers the short sale and there is no interest debited or credited on these items, as no interest is allowed on short transactions, and the stock being covered on the 10th, and the check paid out on the same day, it is not necessary to figure interest on these items. Next, on the debit side we have on September 11th, 100 Sears-Roebuck received, no money, and on the 14th, a debit entry for a check for $15,000. On the credit side under date of September 8th 100 shares of Sears-Roebuck were sold short at 156, amount $15,571. As the stock was received on Septem- ber 11th this covers the short trade of the 8th, and 19 days interest is allowed on $15,571 amounting to $49.30. On the debit side under date of September 14th, we have a check for $15,000, on which interest for 16 days is charged amounting to $40. This is an example showing where Mr. Smith sells short on the 8th and delivers the stock on the 11th to cover the short trade. On September 14th he withdraws $15,000. Next, on September 16th on the debit side we have an entry, 50 Electric Power & Light received account of Stock dividend of 50%. This entry means that the customer previously being 127 WALL STREET long 100 Electric Power & Light when the Corporation de- clared a stock dividend of 50%, is credited (made long) with the 50 shares of stock to which he is entitled as his share of the 50% stock dividend. On September 16th on the debit side is a charge of $150, account of dividend on 100 Continental Baking A which Mr. Smith sold short on September 2nd. This entry means that while Mr. Smith was short the stock sold ex-dividend, and therefore he is charged with the dividend. In the next transaction, on the debit side under date of Sep- tember 18th we show an entry of 100 Congoleum Rights. This entry means that while Mr. Smith was long 100 Congoleum on September 1st the stock sold ex-rights, which entitles him to the rights, and his account accordingly is credited (made long) under date of September 18th with 100 Rights. Mr. Smith desires to subscribe to the 25 shares of Congoleum stock, which his rights entitled him to. These rights are there- fore delivered out of his account under date of September 27th on the credit side, and on the debit side under date of Sep- tember 27th we show 25 shares received on account of the subscription at $250. The $250 is the cost of the 25 shares at the subscription price. On the credit side under date of September 10th we have the entry, dividend on 100 Continental Insurance, $50. Mr. Smith bought 100 Continental Insurance on September 3rd, and the stock having sold ex-dividend between the 3rd and the 8th, his acocunt is credited with the dividend under date of September 10th. The statement shows the balance brought forward September 30th onto the debit side as $4,001.70 and with the account long, 75 Congoleum, 150 Electric Power & Light, and short 100 Kress, $9,800. In taking off a trial balance as of September 30th, the balance on this account would be a credit of $5,798.30, which is the difference between the debit of $4,001.70 and the credit of $9,800. Daily Balance Method The following statement illustrates the transactions made in connection with the account previously explained, with the entries made showing the form used in the daily balance type of statement. 128 WALL STREET o Ph CO 00 05 t>- IO CO io o © H eg lO CO 00 ^ CJ l> H o Cg CO 05 eg as ' eg o o io ‘O id cd 05 co CO H H H CO N CO N N N co co io co 05 ^ lO »0 C5 ^*5* * CO X ^ CO ^ CO « OJ N H H 05 ^ rH iH Ph CO OT tO t- to Ci tj< io ira os « m : «8 ’ a te" 73 " ~ > o Sot-- £ Pi ' i ti a -M o bB , a> fl _ -00^-0- OOHO , ; ® • ;<] u • ; tn 3 m ;.S P.2 ' A) m p| a a pq M flj QJ u «(§= m« 05 . a o 5 3 3^° 5 05 o O CO id od rH CO IO t* eg io ^ oo eg co CO r-H 1 1 IO rH 1 1 05 CO CO eg’ eg’ O CO io eg Ph 'Ph *J a -3 S a £ a a^a d ® a c; ~ o o « a ® ® - oojqMhcq g a « O o ^ O 0 QO o cc t-h O T3 M . S-' l.'S § > o s : ^ __ P5 " •«£ 2 §o « *s 6 rt S C5 0 05 O ,P O WOOOH <1 • ^ ^ o o 05 05 ^Ph« a P CO .* . -t 3 jo bD -3 §«® OS® o Ji rt T-H o . bfl be > P S3 .£00 poo rO m bi)^ o o p O w a a ao d t « M $ o u QD be a «8 I * ® J(S° r— • O CD P b£ -5 m mg « £ OWM OQ 129 WALL STREET In this type of statement it will be noted that there are columns for the date, bought, sold, name of stock, price, debit, and credit, balance debit and credit, and four columns for the figuring of interest; the first column for the number of days, the next two for debit interest items, and credit interest items, and one for the interest items on short sales. In some offices the columns for the figuring of interest are not provided as a part of the statement or ledger sheets. In these offices the bookkeepers keep the slips and figure the in- terest separately, and at the end of the month the net amount to be charged or credited to the customer is entered on the statement. In the preceding statement it will be noted that on the 1st of September there are two debit items totaling $10,- 435 and a credit item of $5,000, which would make a debit balance on the 1st of $5435. This amount is entered in the debit column under the heading of Balance. On the 2nd there is a debit of $11,450 and a total credit of $18,974.50. The difference between these two amounts gives a net credit of $7,524.50. The debit balance on the first is $5,435, and the net credit for the second amounts to $7,524.50, so the difference between these two items would be the new bal- ance, or a credit of $2,089.50, which is shown in the balance column on the credit side. In other words, the difference be- tween the debits and credits up-to-date shows a net credit of $2,089.50. The entry on the 3rd shows a debit of $9,620, and as the previous balance on the 2nd was a credit of $2,089.50, the dif- ference between these two amounts would be $7,530.50, which is the debit balance on the 3rd. The 6th shows a debit of $4, 381, and a total credit of $13,857. The difference between these two amounts is a net credit for that day of $9,476. To obtain the balance for this day we deduct the previous debit balance of $7,530.50 from this amount of $9,476 and the account then shows a credit balance on the 6th of $1,945.50. On the 7th there is a credit item of $15,671. This amount is added to the previous credit balance of $1,945.50, giving a credit balance on the 7th of $17,616.50. To obtain the balance on the remaining transactions the same principle of balancing the daily transactions is applied throughout until the last 130 WALL STREET transaction on the 27th is reached, which shows a final credit balance entry of $5,815.50. To prove this balance, total the debit and credit money columns. The total of the debit money column is $74,174.50 and the total of the credit money column is $79,990. The difference between these two is the last balance of $5,815.50 as shown on the statement. The bookkeeper totals his money columns after each day’s posting, and inserts the balance for the day in the balance column. Figuring Interest Daily Balance Method In the daily balance type of statement the interest is figured on the amount of the debit or credit balance for the number of days which elapse from one balance to the next. The method of figuring these interest items is illustrated in the following examples : The transactions for September 1st give a debit balance of $5,435. The next change in the balance is on the following day and is a credit of $2,089.50. To obtain the interest, charge one day at 6% on the debit of $5,435 and enter in the debit interest column 91 cents, which is the interest at 6% for one day on $5,435. The balance on the 2nd changes to a new balance on the 3rd, so that there is one day’s interest credited on the balance of $2,089.50, which amounts to 35 cents. This amount is entered in the credit interest column. After the 3rd the next change is on the 6th, making three days’ interest to be charged on the debit balance of $7,530.50 on the 3rd, which amounts to $3.77. In handling the interest calculations it is important to watch carefully the number of days figured on each balance and the changes from debit to credit or vice versa. For instance, the debit balance of $7,530.50 on September 3rd does not change until September 6th, on which date the balance changes from a debit to a credit balance amounting to $1,945.50. In this case the three days interest is charged on the balance of the 3rd, $7,530.50, and not on the balance of the 6th, as $7,530.50 is the balance that runs from the 3rd until the 6th. As the bookkeeper in a brokerage house figures the interest on his balances, he also makes a record each day of his short trades 131 WALL STREET and the covering- dates. As shown on the foregoing statement, these short trades have been included in the daily balances and interest has been allowed on them, so, in order to offset this, the column marked “Short” is provided in order that a memorandum can be made of the short trades. Handling Short Trades: It will be noted that on September 2nd 100 Continental Baking A was sold. This is a short trade which was covered on September 14th, therefore, in the short eolumn under date of the 2nd the sale price of the stock, amounting to $7,378.50, is entered. The next short trade made by the customer was on September 6th when 100 shares of Kress was sold at 95, for $9,476. Under date of the 6th, in the short column the amount $16,854.50 is entered which is a total of the short sale on the 2nd of $7,378.50, and the one on the 6th of $9,476. On the 7th, 100 shares of Sears-Roebuck was sold short for $15,671, and this sale was covered on the 10th. This amount of $15,671 is added to the short balance on the 6th, of $16,854.50, making a total in the short column of $32,525.50 on the 7th. On the 8th the statement shows 100 Sears-Roebuck sold short for $15,571, and covered on the 11th. The amount of this short sale, $15,571, is added to the previous short balance of $32,- 525.50, making a total to be carried to the short column of $48,096.50. When a short stock is covered, under the date of the covering transaction, the amount of the original short sale is de- ducted from the previous balance in the short column. On the 10th 100 shares of Sears-Roebuck were received. This transac- tion covers short sale made on the 7th of $15,671, and this amount is accordingly deducted from the balance on the 8th of $48,096.50, giving a balance on the 10th of $32,425.50. On the 11th, another 100 shares of Sears-Roebuck was re- ceived covering a short trade made on the 8th of $15,571. This amount is deducted from the balance of the 10th in the short column of $32,425.50, making the balance for the 11th in the short column now $16,854.50. On the 14th, we have an entry covering 100 Continental Baking A, bought for $7,217.50. This purchase covers the short trade made on September 2nd for $7378.50. To obtain the balance after this transaction the amount $7,378.50 is deducted from the last short balance of $16,854.50, which leaves a bal- ance on the 14th in the short column of $9,476. 132 WALL STREET It will be noted that although the Continental Baking A was bought for $7,217.50, the deduction in the short column is for the amount of the sale, $7,378.50, and not the amount of the purchase, $7,217.50. The difference between these two amounts has already been taken care of in the daily balance column. The last entry in the short column, amounting to $9,476, represents the amount of the short sale made on Sep- tember 6th of 100 shares of Kress, which has not been covered. The method of figuring interest on the short balances is the same as that used in the daily balance. On September 2nd the short balance of $7,378.50 does not change until the 6th. Accordingly the interest is to be obtained for 4 days on this amount at 6 %, which is $4.92. The balance on the 6th of $16,854.50 changes on the 7th, therefore interest for one day is to be figured on that balance, which amounts to $2.81. The balance for the 7th changes on the 8th, and as only one day has elapsed the interest to be figured on that balance is for one day and amounts to $5.42. This method is followed with the remaining transactions down to the last balance on the 14th of $9,476, on which balance 16 days interest is figured, that is, the interest from the 14th to the 30th, which amounts to $25.26. To arrive at the balance of interest at 6% for the month, add the total interest of the shorts, amounting to $68.27, to the total debit interest of $4.68 and subtract the total of the credit interest of $52.31, which gives $20.64 @ 6%. The interest on this amount of $20.64 is next obtained at 5 %, amounting to $17.20, which amount is entered and charged under date of September 30th in the debit money column. As in the other form of statement the open short sale of 100 Kress at 98, amounting to $9,800 is next entered as a debit item and the account is then balanced. The balance under date of Septem- ber 30th is a debit of $4,001.70 with the account long, 75 Con- goleum, 150 Electric Power & Light and short, 100 Kress at $9,800. In some offices where the daily balance system is used, in- stead of figuring the interest at 6 % and putting the amount on the statement as shown above, the amount of the balance is extended in the debit or credit columns according to the 133 WALL STREET number of days to be figured, and at the end of the month after making a net total of these balances, the interest is fig- ured by pointing off 3 places on the net total amount. By dividing this result by 6, we obtain the interest for the entire month. In other words, on the above statement the first balance of $5,435 for one day would be $5,435, which is entered in the interest column. On the 2nd the credit of $2,089.50 for one day would be shown in the credit interest column, $2,089.50, and on the 3rd, the debit item of $7,530.50 for three days would be shown in the debit interest column at $22,591.50, which is three times the balance of $7,530.50. There is another way of treating shorts in using the daily balance system. To illustrate this we will again take the account of Mr. Smith with the transactions, as shown on the next page. 134 JOHN SMITH IN ACCOUNT WITH WALL & CO. WALL STREET o o T* in 00 »n ^ Co in T* oo - t- in co in 05 moo h I © O c< r-H 4 a* o o '« «« P X o 5® c j si; c DOKO : * X * • ^ • rS • .s •j* o p .ft * m 1 . ft c o -Z Ph Ph ~ G W ►h 5 ** • - '* Qcg m w o«i : p ; 1 cS « P " 3 CO -h> cn OQ o O ~ ~ c 3 2 o *G .H © 5 "* o o fC • 0h30Kh] GC OKOfi £ Mo g si KOO o P o o - i-t M- OQP 2 « c 5 a p ° w QC G .J o Z O c G m r-H cc G g« w • tu M o P P 1 P • >i 5° a hh c 8 J © D G 05 ^ o G h£) CQ « O r- © 135 WALL STREET In this type of statement when a short trade is made the amount of the short trade is not included in the debit or credit balance but in order to note the short sale a memorandum of the amount is made in the short interest column. When a short trade is covei-ed, however, the profit or loss is then included in the balance column. In other words, the shorts are entered in the short column the same as in the other type of statement, but no interest is figured on these amounts as they have not been included in the daily balances. Typical Cash Transaction On cash accounts no interest is figured provided full pay- ment for the stock is made within the course of 3 to 4 days. The following is an example of a cash account: Dr. Chas. Peterson (Cash A/C) In Account with Wall & Co., Brokers Cr. Date Amount Days Int. | Date Amount Days Int. July 1 100 Union Tank Car 141 July 1 Check 3000 3 Check ...... 11125 14125 100 Union Tank Car Delv 14125 14125 Figure 22 136 WALL STREET Division of Accounts In the Bookkeeping Department of a brokerage office there are customers’ ledgers and a general ledger ; the general ledger contains dividend account, rights account, fail to receive, fail to deliver, stocks borrowed, stocks loaned, and numerous other house accounts. In most offices there is also a private ledger handled by the Head-Bookkeeper, which contains the firm’s capital accounts, profit and loss, etc. Posting The customers’ ledger bookkeeper posts each day, from the purchase and sale slips, cash sheets, ex-blotters, dividend sheets and journal. The purchase slip shows the number of shares bought, the name of the security, price, extension, commission, total amount, and the customer’s name. The sale slip shows the number of shares sold, the security, price, extension, com- mission, Federal and State Tax, net amount, and the name of customer. Commission, tax and extensions are all figured by another department, so that the bookkeeper has no figuring to do on these items. After making an entry in an account, the bookkeeper places a little slip extending over the top of the sheet which enables him to know at the end of the day just what accounts he has made entries in during the day. After posting the purchases and sales the bookkeeper posts the debit and credit cash sheets. These sheets show money with- drawn and money deposited by the customers. He then posts from the receive and deliver blotters. The receive blotters are the debits, and the deliver blotter the credits. All stocks re- ceived from and delivered to a customer for no money and for money are shown on the blotters. Examples of such entries might be, 100 Erie received for no money for John Smith’s account, or 100 Erie received for $5,000 for the account of John Smith. When a customer delivers stock to a broker and with- draws money for the stock he is delivering, the blotter will show the receipt of the stock for the customer’s account, and the cash sheet will show on the debit side the withdrawal of the money. If, however, a customer sends stock to a broker with draft attached, the receive blotter will show the stock received, and the amount of money paid out on the transaction is charged to the customer on the blotter, and not on the cash sheet. 137 WALL STREET The receive and deliver blotters show transfer of customers' accounts to or from another source, fail to receive, and fail to deliver item, etc. The bookkeeper also posts from the dividend blotters or sheets which show the dividends that are credited and charged to the customers’ accounts. These blotters or sheets are made up by the Dividend Clerk. In the smaller offices the cash and dividend transactions are all shown on the receive and deliver blotters instead of on separate sheets. An- other book used in the brokerage office for recording trans- actions is the journal which is used chiefly to show interest charges, the correction of errors, the transfer of money from one account to another, et cetera. Daily Control After posting these items the bookkeeper takes off what is termed a “Daily Balance”. In the preparation of the daily balance much time can be saved by reason of the fact that the bookkeeper is able to quickly turn to the sheets in his book having the slips marking the accounts to which postings have been made during the day. The daily balance is taken off on a sheet which shows the customer’s name and the total debit and credit items posted in the account for the day. This daily balance sheet is then given to another clerk in the office, whose duty it is to see that every ledger is in balance. If the book- keeper has made any errors in posting or has missed any items which should have been posted, he is notified by the balance clerk, whereupon, he makes the necessary changes or correc- tions. Preparation of Statements Where bookkeeping machines are used, no monthly state- ments are made up by hand, but in houses where they do not use machines it is necessary for the bookkeeper to write up his own statements, which he starts doing a few days after he has sent out his previous month’s statements. During the month he must keep his statement written up-to-date, and footed, and the interest figured and footed. In addition he must keep the ledger footed, comparing the footings with his statements, both as to money and interest, so that at the end of the month there will be no corrections necessary. At the end of the month the bookkeeper should be prepared, as soon 138 WALL STREET as he gets his interest rates, to adjust his balance of interest at 6% to the rate specified, and debit the customers on their state- ments. After the interest has been debited or credited for the month on the statements, the bookkeeper then journalizes the interest on sheets or in a book, by entering the name of a cus- tomer, the rate of interest, and the amount charged or credited to the account. From these interest sheets he posts the items in his ledger and the interest journal is then given to the balance clerk. The bookkeeper next balances his statements, bringing forward the new balance as of the end of the month and also the position. After this has been done he balances the accounts in the ledger, checking the balance and the position as shown in the ledger with the statements. The statements are then given to the Margin Department to be checked as to position and money balance before being mailed to the cus- tomers. Monthly Trial Balance A monthly trial balance is next taken which shows the name of the customer and the debit or credit balance, as brought forward in the ledger at the end of the month. This trial bal- ance sheet is footed and the diffex-ence between the debit and credit balances should be the same as that which the balance control clerk shows in his records. In brokerage offices the ledgers are balanced individually, and the accuracy of the accounts is maintained by means of a control system which has been developed to check and control the different books used in the bookkeeping work of the firm. General Instructions The bookkeeper should not open a new account unless he knows it is a new accoxxnt, as sometimes through an error in some department, a wrong name or initial is used, and by checking back before any new account is opened any error of this kind will be discovered. Positions must be checked out at all times, so that in case anyone connected with the brokei-age house inquires as to what stocks a customer is long or short, the bookkeeper can give the information immediately. The bookkeeper may save considerable time at the end of 139 WALL STREET the month by closing or balancing his inactive accounts a day or so in advance. In opening a new account the bookkeeper should watch to see that the margin or collateral required is deposited within the course of a few days, and if this is not done within this time, he should notify the margin clerk. He should also watch carefully, in crediting dividends or coupons to an account, to see if the customer was previously long of the securities, as sometimes the dividend clerk, through an error, will credit the wrong customer. The same applies to a debit dividend where a customer is short or was short. Clearance Dates In Wall Street all purchase and sales made on any day, clear the next full business day, therefore, a customer buying or selling stock on a particular day is not charged or credited with the purchase or sale until the following full business day. General Ledger The dividend, stock borrowed, stock loaned, fail to receive, and fail to deliver accounts are all handled in practically the same manner, that is, the number of shares and the money are checked when the transaction is closed. To illustrate the man- ner in which this is done the following statement is presented : 140 WALL STREET Si o S3 S3 O O o <1 S 3 S-i -£3 o o o 03 o CO 4-> ft V 02 Figure 23 WALL STREET Dividend Account The debit side of the dividend account shows the open items which are charged to the dividend account until they are col- lected from the various sources from which they are due. On the debit side of the preceding statement we have an entry as of September 4th covering 200 Cal. Packing, (stock loaned) $200. This item is closed out on the credit side on September 6th by being checked off as to the number of shares, and the money. The balance of the accounts, such as fail to receive and fail to deliver are handled on the same principles, except that in some houses the ledger clerk posts the total amount of the fail items each day, and the blotter clerk keeps a mem- orandum of the open transactions, cheeking out at intervals with the money balance as shown in the ledger. Wire Accounts In the brokerage houses which have wire accounts, certain bookkeepers are assigned to handle these particular accounts. A wire account is posted, in the same manner as the other accounts. Each day a transcript is made up of all debit and credit items for the day and this is mailed to the wire house. At the end -of the month the bookkeeper will then wire the interest charges for the month, and send a statement showing the balance brought down as of the end of the month, together with the position of the account. As the wire house has already received from day to day a record of the daily transactions in the account it is not necessary to send these at the end of the month. On wire accounts, the position is not checked in the ledger, as the great number of entries made each day in such accounts makes this impracticable ordinarily. A position sheet, however, is kept for each wire account, showing each security and the changes from day to day. 142 CHAPTER VI Stock and Bond Record Department STOCK AND BOND RECORD DEPARTMENT This department maintains a record, which is balanced daily, of all securities bought and sold, received and delivered for its clients, and shows where the securities are located. The work is handled by Take-off clerks, who make up sheets known as Take-off sheets, and by stock record clerks who post in the stock record books. The bond and stock records are kept in the same general manner but in separate books or on sets of cards. In the bond record books on the top of the sheet or card, as the case may be, is kept a record of the interest dates, such as January and July 1, February and August 1st, March and September 1, March and September 15, showing when coupons on bonds are payable. Importance of Record The stock record department is one of the most essential in the brokerage organization. This department keeps a record showing the balance on each security each day. If any securi- ties are lost or stolen they are aware of the fact that same day. Should the records of the Bookkeeping and Margin De- partments disagree as to the position of any account they can always check back with the stock record department. If the market should have a sudden rise or sudden drop in any one or two securities, the margin clerk, instead of going through all of his accounts to find out who is long or short of these particular stocks, can save much time by referring to the stock record book, to see what customers are carrying the securities in question and he can then turn to those accounts in his margin book. The cashier’s department has certain securities to deliver each day and they refer to the stock record book to find out where these securities are located. The stock record will show, for instance, that certain certificates are in the box, others in transfer, and some in Bank Loans, etc. A large brok- erage house may have as many as a hundred or more bank loans with fifteen to twenty-five different stocks in each loan, and the cashier’s department therefore can save considerable time by referring to the stock record book. The Dividend Clerk, gets all his positions from the Stock Record Department. All 145 WALL STREET departments are continually referring to the books in the stock record department. In many houses the securities in loans are not itemized individually, such as “Guaranty Trust Co., Nov. 1st,” but are placed in one account called “Hypo” (Hypothecated). In such cases the loan clerk maintains a separate record indicating the exact location of securities in loans. Dividend Information In some houses the Stock Record Department makes up sheets each day showing the stocks that are selling ex-dividend (cash or stock) and ex-rights and also furnishes a list from the bond book showing when coupons are due. These different sheets are handled as follows : In the morning the Stock Rec- ord Department receives a report of all stocks selling ex- dividends or ex-rights that day. A record is given to the Dividend Clerk on these stocks and on the number of shares in the box and in the loans on the previous day. Later during the day the Dividend Clerk will pass these sheets back to the stock record man, who after posting all the items for the day in his stock record books, will make a copy on the dividend sheets of all the longs and shorts. After doing this he then returns the sheets to the Dividend Clerk. He then stamps “ex- dividend date” in his book in the column of the day on which the stock sells ex-dividend. Method of Take-off In preparing the Take-off record the clerk will : 1. Enter on cards or sheets the securities bought and sold for customers for the day. 2. Take a record of all the securities in bank loans that are paid off for the day. 3. List all the securities that are put in new loans made for the day. 4. Enter all securities that are taken out of and put in loans on account of substitutions. 5. Take a record of all securities received back from trans- fer and securities put in transfer for the day, or, in other words, securities in transfer (sent to the Transfer Agent) and 146 W A L L S T R E E T securities out of transfer (received back from the Transfer Agent) for the day. 6. Next take a record from the ex-blotters of all securities received from and delivered to clients, accounts transferred from one house to another, stocks borrowed and stocks loaned, and all Fail to Receive and Fail to Deliver items for the day. 7. Take a record each day of all securities that are taken out of the box in the morning and all securities put in the box at night. In some houses they do not list the securities taken out of or put in the box each day, in which case the Take-off man will have to consider the shares in the box the previous day as coming out, and the shares in the box on the current day as going in. 8. Lastly, enter all securities taken out of, and all securities put in Safekeeping, (Private Envelope.) These entries are taken from the No-Money Blotters, which are the records where all the stocks received or delivered without money being paid or received for them, are entered. Locating Errors The Take-off sheet or cards should now show all the changes or movements in the securities for the day. Each security should balance. If there are any differences, the Take-off man must check each item carefully. If after checking there are still discrepancies, a list is made of the securities having errors. The first thing in the morning a recount is made of the certifi- cates in the box, of those securities in which there is an error, as oftentimes mistakes are made in counting the box at night. Should there still be differences after a recount of the box, it is necessary for the Take-off man to find out what errors have been made, which may be in stock received or delivered with no entry made, or stock taken out of, or put in transfer with- out an entry, etc. In other words, he must balance each security each day. Unless he balances there is no way to tell whether a security has been lost or stolen or whether the mistake resulted because of a failure to make proper entry. If after checking it is found that some of the securities are still out of balance, the head stock record clerk must cheek 147 WALL STREET all the numbers of the certificates received and delivered for the day, and in that way arrive at the numbers of the securi- ties in the box the day previous. If, however, he cannot get all the numbers of the certificates that were in the box the day previous, he must go back another day, until, finally by checking what was in the box plus the securities received, against the securities delivered, the numbers of the missing certificates are discovered. Then the lost certificates must immediately be reported. On a Take-off sheet all securities bought, or received in the office for customer’s accounts are entered on the left hand side, and all securities sold or delivered to customers are entered on the right side. The left hand or long side shows how many shares are to be accounted for. The right hand or short side shows where these securities have gone. If both sides balance, then all shares have been accounted for, and their location shown. Example of a Take-off Sheet Atchison, Topeka and Santa Fe R. R. Co. Transactions for: November 1st 11/1 150 J. Jones Box 100 Transfer 50 150 150 November 2nd 11/2 500 F. Jorgensen 150 J. Schmidt H. Adams 100 Chat. & Phoe. 200 Chase 100 Box 150 F. Rec. 100 650 650 148 WALL STREET November 3rd F. White 200 H. Adams 150 25 Transfer 50 125 F. Deliver 250 Box 400 400 November 5th 100 Stock Borrowed Fail to Del. 100 25 H. Peatey 50 Fail to Rec. Hanover 25 25 Tfr. 50 Box 25 200 200 Posting of Take-Off The Stock Record Clerk posts each day from the Take-off sheet. As the posting of the individual items are made, they must be checked thus (V). After all items are posted and the securities are properly balanced, the clerk makes a large cross (X) through the Take-off sheet or the card records of these transactions, denoting that the posting of these items is com- pleted. After posting the above items for November 1st, 2nd, 3rd, and 5th, the stock record account will show the following position of the firm with respect to the Atchinson, Topeka & Santa Fe stock : 149 WALL STREET Long Atchison, Topeka and Santa Fe R. R. Co. Short 11/1 11/2 11/3 11/5 11/1 11/2 11/3 11/5 J. Jones 150 150 150 150 Box 100 250 25 F. Jorgensen 500 500 500 Transfer 50 50 75 100 J. Schmidt 150 150 150 H. Adams (Red) 100 250 250 F. Receive 100 100 50 F. White (Red) 200 200 Chat. & Fail Deliver 125 25 Phoe. 200 200 200 H. Peate.v Stock Bor- 25 Chase Nat’l 100 100 100 rowed 100 Hanover 25 150 700 475 500 150 700 475 500 On the Take-off sheet if the figure is on the left side of the account, the account is long that much, if the figure is on the right hand side the account is short that much. Short means that that is where the securities are located. On the Take-off sheet for November 1st J. Jones is shown as long 150. This indicates that J. Jones bought 150 shares which must be accounted for, i. e., have their location shown on the stock record. In showing where these shares are located we show the “Box” (on the right side) as containing 100 shares, and show the remaining 50 shares as being in transfer. The 50 shares in transfer means that those 50 shares have been sent to the transfer agent of the Atchison R. R. to be transferred to another name. The 150 shares bought for J. Jones have now been accounted for and their location has been indicated. Note : The box is a metal receptacle in which the certificates are put each night and then sent to the vault until the following morn- ing. On the stock record sheet accounts that are long go on the left side of the sheet, and accounts that are short go on the right hand side. The following tabular statement shows these accounts in the positions mentioned : 150 WALL STREET On the left side (Long) Customers Long Customers Short (in red) Pail to Deliver Stocks Borrowed On the right side (Short) Box Safekeeping (Private Envelope) Transfer Pail to Receive Stocks Loaned Bank Loans The customers’ transactions and the bank loans are kept under the name of the individual account, that is, under the customer’s name or the name of the bank, but the transactions involving the accounts Pail to Deliver, Stocks Borrowed, Fail to Receive and Stocks Loaned accounts are kept under one account, the individual names of the brokers borrowing the stock, etc. not being shown on the Stock Record Sheet. Keeping in mind the principle stated above, that the long side shows what securities are to be accounted for and the short side shows their location, it is easy to understand why the above items are on their respective sides. If stock is bought for cus- tomers it is a long and must be accounted for. If stock is bor- rowed or not delivered when sold, those shares must be lo- cated. On the other hand, if the stock is shown as being in the box, or out being transferred, or lent to another broker, or put in a bank as collateral, or not received from a broker who should have sent the stock, then the location of the shares is known. Customers short transactions are really a short item and in many houses are put on the short side. However, in most of the houses they are put on the long side in red for conve- nience in keeping all the customers’ accounts together. The wide columns of a stock record are for the names of the accounts, (customers, Banks, Fail to receive, etc.), and the nar- row columns are used for the number of shares that the ac- count is long or short on the date marked at the head of the narrow column. Each full day that the Stock Exchange does business has a separate column, and no changes are made in the column of a previous day after it is balanced, unless a clerical mistake is discovered. The name of an account is never put on a stock record twice. There is an exception to this rule in those houses that keep the 151 WALL STREET customers short on the right hand side of the stock record sheet. In those houses if a customer previously long, goes short, or vice versa, then he is closed out on the side on which he was shown previously and he is entered on the opposite side. Daily Changes and Proof In the example previously cited the transactions for Novem- ber 1st are posted on the stock record sheet in the column of that date, the items being: J. Jones on the left side, 150, and on the right side, Box 100, and Transfer 50. After all postings for a day are made, the columns for that date on both sides of the sheet are totaled. The totals should be the same. In this case both sides add up to 150, therefore this stock record sheet is balanced for the day. On November 2nd the take-off sheet shows 650 shares bought or received for customers, for the account of F. Jorgensen and J. Schmidt and 100 shares sold or delivered H. Adams. This leaves a balance of 550 shares to receive. Of this 550 shares 450 were actually received and the broker from whom the firm should have received the other 100 shares failed to deliver them. The location of the 450 shares actually received is as follows : 200 were put in a loan with the Chatham and Phoenix National Bank and 100 were put in a loan with the Chase National Bank, while the remaining 150 were put in the Box. On the stock record sheet F. Jorgensen is shown on the left side, as long 500 and J. Schmidt is shown as long 150. H. Adams is put on the long side in red denoting that he is short 100. All these figures are put in the second column under the date of 11/2. The Chatham and Phoenix Bank is entered on the right side for 200 and the Chase Bank for 100. On the stock record under 11/1 the box account showed 100 shares which meant there was 100 shares in the box. Now the take-off sheet shows another 150 going into the box. This 150 added to the previous 100 makes the box account now 250. This means that there are now 250 shares in the box. Failed to Receive is shown on the right side, as 100. All the items on the take-off sheet have now been posted on the stock record. The next thing to do is “to extend out” the open items. “The open items” are those accounts of the previous day in which no posting has been made on the current day. J. Jones still has the 100 shares he had on 11/1 and so this “open item” is simply brought forward 152 WALL STREET to the column for 11/2. In the same way, the 50 shares shown in transfer on 11/1 are still in transfer and so this 50 is brought forward into the column of 11/2. The total of the left side is now 800 for the black figures and 100 for the red figures. The red total is substracted from the black leaving a balance of 700. The right hand side makes a total of 700, so the stock rec- ord is now balanced. On November 3rd the take-off sheet shows that 350 shares were sold for customers F. White and H. Adams. The 350 shares that the firm had to deliver on account of these sales were handled in the following manner : 250 were taken out of the box as is shown by the entry on the left hand side, 25 shares came in from Transfer, but 50 went back in transfer, Fail to Deliver is on the long or left side for 125, which means that the firm failed to deliver 125 shares of those sold. F. White was not previously long any stock so he is short the 200 shares he sold. He is therefore entered on the left side in red with 200. H. Adams sold another 150 which makes him short 250, counting in his short of 100 on the day before. On the take- off sheet transfer is shown as having 50 go in transfer (or out to transfer) and 25 comes out of transfer (or comes back from transfer). This leaves a balance of 25 shares going in to trans- fer. The stock record sheet shows that there were 50 shares in transfer on 11/2, so now, with the 25 going in on 11/3 there are 75 shares in transfer on 11/3. 75 is put on the short (right) side of the stock record sheet opposite transfer in the column headed 11/3. Fail to Deliver is a new account. It is shown on the left side of the take-off sheet as long 125. It is therefore en- tered on the long (left) side of the stock record for 125. On the take-off sheet for the third is shown on the left side, Box 250. This means 250 shares came out of the box. The stock record shows there were 250 in the box the day before, so now, the box is even-up, i. e., there is no stock in the box. This is indicated by putting a dash in the column of the November 3rd opposite box. Now the open items are brought forward as follows: J. Jones 150, F. Jorgensen 500, and J. Schmidt 150, on the long side: with Failed to Receive. 100, Chatham and Phoenix 200, and Chase 100 on the short side. On the long side the black figures total 925, the red add up to 450, leaving a difference of 475. The short side adds up to 475, thus balancing the sheet for November 3rd. On November 5th the take-off shows St. Bd. (Stock Bor- 153 W A LL S T R E E r r rowed) 100 on the left side and Failed to Deliver 100 on the right side. Ordinarily the broker would not borrow stock, or fail to deliver stock, when there is stock in the box or in loans ; but these accounts are shown in order to have an entry for every account that will appear in the stock record. H. Peatty is shown on the left side as long 25, F. Rec. (Failed to Receive) is shown 50 on the left side which means that 50 (of the 100 not received on the 2nd) have now been received. Han- over, on the right side shows 25, in other words 25 shares were put in a loan with the Hanover National Bank. Transfer shows 25 on the left side and 50 on the right side, which leaves a net difference of 25 on the right side or going in to transfer, 25 are put in the box. This is posted in the Stock Record Book as follows : H. Peatty, a new account, is entered on the long side with 25 shares in the column headed 11/5. Likewise Stock Borrowed is entered up for 100. The take-off shows Fail to Deliver 100 shares on the right side, and since there were previously 125 to deliver, this leaves “Fail to Deliver” now 25. In the same way, the take-off shows Fail to Receive on the left side 50, and as there were 100 shares the day before in “Fail to Receive” ac- count, there are only 50 shares to receive now. Hanover is a new account and is entered for 25 on the right side. The stock record showed 75 in transfer, and since today, the 5th, there is a net difference of 25 more going in transfer, there are now 100 shares in transfer. This 100 is entered in the column of 11/5 opposite transfer. The take-off account also shows 25 shares going into the box and since there were no shares left in the box, it now shows 25. After the open items are extended out, the left side adds up to 950 black less 450 red which leaves a balance of 500. The right side adds up to 500, thus balancing the record for the day. Occasionally there are entries for other house accounts such as, Dividend, Trading, etc. These may be on either side of the Stock Record book. Fixed Location of Certain Accounts In posting in the stock record book, it must always be borne in mind that the long side shows customers long and short. Fail to Deliver, and Stock Borrowed accounts. On the short side will appear the following accounts : Box, Safe-keeping and 154 WALL STREET Private Envelopes, Fail to Receive, Bank Loans and Stock Loaned. It is very important that these accounts be kept on the side indicated. If an entry on the take-off sheet was such that it would compel you to post one of these accounts on the wrong side you would know (assuming you have posted the Stock Record correctly) that someone had made a mistake and it would be necessary to correct it before posting could be con- tinued. For example : When a broker has certain stock to de- liver and he does not deliver the stock on that day, he makes an entry on the “Receive” side (long side) of the Blotter, stat- ing that he is “Failing to Deliver” the stock. Now as he is “fail- ing to deliver” only 100 shares he cannot at a later date, deliver more than the 100 shares that he owes. The same applies to Stock Borrowed. He cannot return more stock than he bor- rowed so this account must always be on the long side of the Stock Record Book. The “short side” shows where securities are located such as : “Box,” “Transfer” and “Bank Loans” and stock owed by some other broker on account of Fail to Re- ceive or Stocks Loaned items. If there are 100 shares in the box no more than this amount can be subsequently taken out. The same applies to Transfer and Bank Loans. On Stocks Loaned there cannot be more stock returned than was originally loaned out. Another reason why it is important that these accounts must be kept on the correct side is, that while a Stock Record Clerk may balance each day he may still have posted the shares in the wrong accounts. For example, the Clerk may have put 100 shares in Transfer instead of in the Box. Suppose that on November 5th there are 100 shares in Transfer and the next day’s take-off shows on the left side 150 shares com- ing out of Transfer. This item could not be posted correctly as it would show a Transfer of 50 on the long side. In that case it would be necessary to call the error to the attention of the Head Stock Record Clerk or Take-off man to find out where the mistake had been made. On the Take-off Sheet the Box, Transfer, etc., will frequently have a figure on the left side and on the right side. Do not post such an item by first taking the difference and then adding or subtracting it, as the case may be, from the previous amount for that account. For example, the Take-off Sheet might show : “75 Box. . .100.” In posting this item do not glance at the Take- off Sheet and post 25 additional shares in the Box. The proper method is to look at the previous amount in the box, subtract 155 WALL STREET 75 and then add 100. In this way it will be possible to correct any error the Take-off man may make in having more shares come out of the box than were in there. In the above example, say there were only 50 shares in the box the day previous. If the clerk first tries to subtract the 75 he would notice the error immediately, whereas if he merely added the difference 25, the mistake would probably be overlooked. Watching Undelivered Items The stock record clerk should notify the securities cage when he has a Fail to Deliver item open and there is stock in the box or Bank Loans, as it is unnecessary to fail on a security when it is available for delivery. The stock record clerk should in the same way notify the securities cage when he has a Stock Borrowed item open and there is stock in the box or in bank loans. The stock record clerk should also watch carefully to see if a customer is long the common stock and short the preferred stock of the same company, or vice-versa, and if so he should check up with the margin clerk as it may be an error. A cus- tomer would rarely be long one and short the other. Checking and Bringing Forward In some houses the securities in the Box and in Transfer, as shown in the stock record book must be checked with the Box book and with the Transfer book, so that in case of any errors they may be easily adjusted. On some securities where there are not many changes the stock record clerk will post the changes each day but does not total or bring forward the open items until he feels ready to balance in order to make sure he has made no error. All items, however, must be extended at the end of the month, ex-divi- dend date, coupon date, or when an audit is being made, and each security must be balanced. When a stock record sheet is filled, in opening a new sheet only the open items are brought forward. In other words, ac- counts that have been closed out are not brought forward to the new sheet. Where a stock is very active and has a number of customers long and short of it, the names of the customers are arranged in as near alphabetical order as possible. 156 CHAPTER VII Dividend and Coupon Department DIVIDEND AND COUPON DEPARTMENT The work of the Dividend Clerk consists of keeping a record of all stocks selling ex-dividend on both cash and stock divi- dend paying securities. In addition he must keep informed on, and be prepared to handle the work involved in the closing of the books for rights, the exercising of rights on the expiration date, the exchange of securities, stocks carrying due bills, is- suing regular due bills, assessments on stocks, making claims for dividends, collection of claims for the firm and clients, cred- iting customer’s accounts with cash and stock dividends when payable, crediting the customers with interest on bonds when payable, crediting the customers’ accounts with rights, and su- pervising the transfer of securities when the books close for dividends. Source of Dividend Information The Dividend Clerk must keep a diary. In this book a record is kept, by date, of the Corporations closing their books for dividends (Cash and Stock) and rights. Information about the closings of the books for dividends is obtained in advance from sheets issued daily and weekly by the Standard Statistics Corporation, Poors and others. These lists show the advance dates for closings, and also a list of all the closings for that day. In addition, weekly bulletins are issued by the New York Stock and Curb Exchanges. For the Standard Oil Stocks, a well known house issues a weekly list of the future closings. Each morning, the New York Stock and Curb Exchanges print on the ticker the stocks that are selling ex-dividend that day. Out-of-Town Transfer Agents The Dividend Clerk keeps a record of the closing of books for dividends on all the inactive securities, when the information is not obtained from any of the above sources, and enters all this information in his diary under the date specified as the closing date. There are some cases such as those involving unlisted stocks, and stocks traded in on out of town exchanges, where it 159 WALL STREET is necessary for the Dividend Clei’k to advance the date for closing of books several days. For example, if the books of a certain stock were closing for dividend in Boston, on July 10th it would be necessary for the dividend clerk to see that the stocks to be transferred were mailed out in time to be received in Boston by the 10th, which would make it necessary for the stock to leave New York on the 8th of the month. Ex-Dividend Date — Closing of Transfer Books In connection with the making of dividend payments a cor- poration will set a certain date for the closing of its books for dividend. A record is taken by the Corporation on this date of all its stockholders, and at some later date, usually two or three weeks later, checks for the dividends due are mailed to the stockholders of record on the books of the Corporation on the date the books were closed. The Exchanges rule that the stocks shall sell ex-dividend the same day that the books are closed by the Corporation. “Ex-dividend” means that the amount of the dividend is automatically deducted from the price of the stock on the morning of the day the Corporation’s books close, excepting on cash or immediate delivery transactions. Procedure On Ex-Dividend Date In the regular course of his work, the first thing the dividend clerk does in the morning of each day is to make up lists, in triplicate or quadruplicate from his diary (in alphabetical order) of the stocks selling ex-dividend that day. One copy is given to the Margin Department, one to the Blotter Clerks in the cage, one to the Transfer Department, and the other he retains for his own use. The copies given to the Blotter Clerk and the Transfer Clerk are retained by those departments in order that they may know, as stocks come in during the day, what securities to put in transfer so that the firm may receive the dividend. If the Blotter Clerk does not know what stocks are selling “Ex,” he will put such stocks in the box instead of in transfer. Also if the Transfer Clerk does not know what stocks are selling “Ex,” he may deem it advisable to hold the transfer over until the following day. On the day the books close all stocks must be in transfer by 3 o’clock in order that 160 WALL STREET the firm or individual to whom the stocks belong may receive from the Corporation, the dividends to which they are entitled. The first thing in the morning, the Stock Record Department, from the information supplied by the published dividend lists, will make up proofs (sheets) for all stock selling “Ex” that day. These proofs are given to the Dividend Clerk, who will check them against his list, and if there are any stocks on his list for which he does not get a proof, he will request the Stock Record Department to make one up. Now, for example, we will say that U. S. Steel is selling ex-dividend September 27th, payable October 15th at the rate of $1.75 per share. The Stock Record Clerk, on the morning of September 27th will make a proof. This proof is generally made up of two sheets attached together. On the inside sheet, the Stock Record Clerk will show the following: U. S. STEEL CORPORATION— COMMON Books closed 9/27 payable 10/15 Rate $1.75 Box 376 Commerce 400 Chase National 300 Chemical 500 This proof will be received by the Dividend Clerk, who will immediately go to the box and see what names the 376 shares are registered in. If not in the firm name (or in the names of the customers who are long) he takes out the certificates and gives them to the Transfer Clerk for transfer to the firm’s name. He then goes to the loan book (in some houses the Loan Clerk attends to this work) and ascertains what names the 400 shares in the Commerce Bank, the 300 shares in the Chase, and the 500 shares in the Chemical Bank are registered in. If not in the firm’s name or, in the name of a customer who is long, the Dividend or the Loan Clerk will make a substitution, withdrawing the securities not registered in firm’s or customer’s name from the loans. After the stock is taken out of the loans it is given to the Transfer Clerk to be transferred to the firm’s name. The Dividend Clerk then makes a record on his proof of all the numbers of the certificates in the box and in loans. This is the manner in which all ex-dividends for the day are handled each morning. 161 WALL STREET The proof now goes back to the Stock Record Clerk, who, after posting the September 27th business will make a final proof showing all the longs and shorts. In other words, he will make an exact copy of his stock record sheet. This would be in the following form and would show the following condition : Outside Sheet Inside Sheet U. S. STEEL CORPORATION Books close 9/27 13 F. Deliver 500 J. Jordan 150 H. Lampe 200 H. Simmons (10) E. Murray Payable 10/15, Rate 1.75 438 Box 100 St. Loaned 115 Tfr. 20 Fail Receive 100 Commerce 100 Chase 873 The Dividend Clerk now makes extensions showing the amounts to be credited to customers, etc., and the different sources he is to collect from, as follows : Outside Sheet U. S. STEEL CORPORATION— COMMON Books Close 9/27 Div. Payable 10/15, Rate $1.75 13 F. Deliver (Otis & Co.) Dividend a/c 22.75 500 J. Jordan 875.00 150 H. Lampe 262.50 200 II. Simmons 350.00 (10) E. Murray 873 1,510.25 10 — name customer (Murray) 743 — firm name 1,300.25 100 — St. loaned Thomson & McKinnon, Div. a/c 175.00 20— Fail Receive De Coppet & Doremus, Div. a/c 35.00 873 1,510.25 162 WALL STREET There are a few stocks which have coupons attached. These coupons are numbered and when the stock sells ex-dividend the number of the coupon is specified and the Dividend Clerk must cut these coupons, and send them out for collection, crediting his customers with the proceeds. Procedure On Payable Date The above record now shows that when the dividend is payable on October 15th, the Dividend Clerk will credit the customers with $1,487.50 and dividend account $22.75 account of fail to deliver, total $1,510.25, and he will receive from the U. S. Steel Corporation a check for $1,300.25 for stock regis- tered in the firm’s name. He will also receive $175 from Thomson & McKinnon on the account of stocks loaned, ami $35 from DeCoppet & Doremus on the account, Fail to Re- ceive. Should a customer be short when the books close he is charged with the dividend. Items on fail to deliver and stocks borrowed are credited to dividend account and fail to receive and stock loaned are debited to dividend account. When payment is made the money is charged or credited to the dividend account, as the case may be. Due Bills (Cash Dividends) When a stock sells ex-dividend and the firm was loaning stock or failing to receive stock, the dividend clerk must get a due bill from the broker to whom the stock was loaned or from whom stock is ‘failed to receive.’ For instance on the above mentioned transactions you would obtain a due bill from Thompson & McKinnon account of “stock loaned” and one from De Coppet & Doremus on the account of “Fail Receive.” A due bill reads: “Due John Smith & Company, dividend of 1.75 a share on 100 shares of U. S. Steel books closing Septem- ber 27th, payable October 15th.” “Harry Jones & Company.” When the dividend is payable on October 15th you have your firm endorse the due bills on the back, and then send them for collection to the firm that issued them. A Dividend Clerk must issue due bills to the firms he is borrowing stock from or “Failing to Deliver” stock to. 163 WALL STREET Stock Dividends These dividends are payable in stock instead of in cash. They are handled the same as a cash dividend except that when the stock is received from the corporation you credit the customer with stock instead of cash. The entries making the customers long of the stock (after the dividend is received) are entered on the Receive Blotter. Stock Dividends (Carrying Due Bills) A “Due Bill” is an instrument or paper, issued and passed between brokers, showing that there is due the holder of a “Due Bill” certain benefits such as Cash or Stock dividends, or Rights. This paper is used during the interim between the corporation record date set for the payment of dividends or rights and the date set by the Stock Exchange, as to when such dividends or rights become effective as hereinafter ex- plained. The necessity for these “Due Bills” may be brought out clearly by the following example : A Corporation announces that it will distribute a stock dividend of 50% to stockholders of record on July 1st, payable August 1st. The Stock Exchange may rule, for various reasons, that holders of the stock on July 15th and not July 1st are entitled to this stock dividend. Ac- cording to this ruling of the Exchange, the stock will sell “ex-dividend” on July 15th. This does not affect the records of the Corporation, and the stock dividend as originally an- nounced will be distributed to stockholders of record on the corporation’s books as of July 1st. The Dividend Clerk will take a record on July 1st, the day the books close for the corporation, just the same as though the stock was selling Ex on the Exchange on that day, and he will have all securities not in the firm’s name transferred to the firm’s name in order to receive the dividend from the cor- poration. He does not, however, credit the customers as of this date. At the close of the day on July 1st, whatever stock is in the box, and in bank loans (which should all be in the firm’s name) must have due bills made out for it and these must be attached to the certificates, otherwise they will not be con- sidered a good delivery. The due bill form is, as follows : 164 WALL STREET “FOR VALUE RECEIVED, the undersigned, holder of record at the close of business on July 1st, 1929, of (100) One Hundred shares of Common Stock of U. S. Steel Corporation, represented by certificate No. 1262762, hereby assigns, trans- fers, and sets over unto the 50 shares of common stock of U. S. Steel Corporation to which the undersigned is entitled as a stock dividend. Dated: 7/2/29. Firm’s Signature In the Presence of : Simons, Blauner & Co., 50 Broad Street, Witness: J. Jones. New York City. The Blotter Clerk and the other clerks handling securities in the cage must be advised that the stock is carrying due bills so that they will not receive any stock in the office unless there is a due bill attached. If the stock is received from a customer, or an out of town client without a due bill, the clerk receiving the stock must attach a memorandum to the certificate with the name of the customer (or the name of the out of town house that delivered the stock), and must then inform the Dividend Clerk, who will write the individual or firm from whom the stock was received, requesting them to forward a due bill to be attached to the stock. During the time the stock is carrying due bills all stock that is put in transfer must have the due bill detached. This due bill is then given to the Dividend Clerk. These due bills he will hold and collect on when the stock sells ex-dividend on the Exchange. When stock comes back from the transfer in the firm’s or in a client’s name, the Dividend Clerk must at- tach a bearer due bill signed by his firm. This due bill is marked “Account of stock in transfer.” The Dividend Clerk must also issue a bearer due bill to the brokers who give their names for transfer. He should keep a complete list of all due bills issued in order to determine the exact amount he must pay out account of due bills when the stock sells “Ex” on the Exchange. On the date of July 15th, the day on which the stock sells Ex on the Exchange, another record is taken in the same manner as for the regular dividend date, and the customers who are long on the Ex date receive the dividend. It is not necessary, however, to transfer any stock on this date as the corporation takes a record of stockholders as of July 1st. 165 WALL STREET The Dividend Clerk must now detach all the due bills on stock in the box and in loans, cancelling the ones issued by his own firm, and placing the others temporarily in an envelope for collection, with all the other due bills he has received. Should there, through an oversight, be any certificate in loans or in the box not in the firm’s name without a due bill attached, the Dividend Clerk must locate the party or firm who delivered the certificate and get a due bill, or collect the dividends from them. In the process of balancing and crediting the customers the following steps are involved : The Dividend Clerk receives from the Corporation the stock due his firm for the account of stock registered in the firm’s name on July 1st. This stock together with the stock he is to receive after collecting on all his due bills will give a total of what the Dividend Clerk will receive. He will then determine how much stock he must pay out on the account of due bills he has issued which are out- standing, plus the number of shares he must credit his cus- tomers who are in a long position on the firm’s books on July 15th, after which he should be able to balance his books. Due bills are not always presented for collection the same day they are payable, but, if the records are kept correctly, the Dividend Clerk can always tell what due bills are out- standing. In addition to the points covered in the foregoing descrip- tion, another condition for the Dividend Clerk to take note of is the following: A client may be long stock July 1st as in the above case and may give instructions (while the stock is carrying due bills) to have it transferred to his name and de- livered to him. The transfer is made and the stock delivered to the customer with a due bill attached. Unless a due bill is attached to the security, the customer will not get any dividend as he will not be shown long on the firm’s books on July 15th. Cash or Stock Dividends (Optional) In some cases a corporation will declare a dividend, payable either in stock or cash at the option of the stockholder, and will designate a specific date by which time the stockholder must inform them which he desires to receive. The Dividend Clerk must immediately notify all customers who are long of the stock when the books close, and advise the corporation accordingly. In addition, when the time limit 166 WALL STREET draws near the Dividend Clerk will confer with the Cashier and then notify the Corporation as to what they desire to re- ceive in dividends due them. There have been cases where the difference in accepting stock instead of cash (or vice versa) has involved a considerable difference in value and accordingly in what the stockholder would receive. In these cases the firm will take what gives the best value and will settle with the customers as they instruct, either in cash or in stock. Cash Settlement Fractional Shares Where a corporation declares a stock dividend, payable in stock and the stockholder receives as his dividend only a frac- tional share, or full shares and a fractional share, the Corpora- tion instead of issuing fractional shares will at times settle on a cash basis at the market price. For example, the books of the Goldman Sachs Company close on November 1st for a 1 °/o dividend. The closing bid price for the stock on that day was $100. If the records show 590 shares of that stock held in the firm’s name, you will receive 5 shares of stock and $90 in cash in lieu of the fraction represented by the 90 shares. The customers of the firm would be credited, as follows : Goldman, Sachs Company CR 1 sh. $10 cash in lieu of fraction 3 sh. $80 cash in lieu of fraction $84 cash in lieu of fraction $16 Total to be credited and paid out 4 sh. $190 Cash The above statement shows a total of 4 shares and $190 cash to be credited to customers and to the account of Fail Deliver, and, as indicated previously, the firm would receive 5 shares and $90 from the Corporation. It is now necessary for the firm to sell one share of stock in order to make up the difference in cash credited to customers in lieu of the fractional shares and the cash received in lieu of fractional shares issued by the company. It is very important that the dividend proofs be 110 John Brown 380 James Dunn 84 Mary Jones 16 Fail Deliver 167 WALL STREET balanced as soon as possible as the market price of the stock may go down between the “Ex” date and payable date. The more odd lots that customers are long of, the more stock it will be necessary for the firm to sell to adjust the difference. The above procedure is, of course, not necessary if the Cor- poration will issue fractional shares. Rights To Subscribe Rights are handled by the Dividend Clerk in the same way as cash and stock dividends, except that the customers are credited with Rights. For example : General Motors Corpora- tion are offering the stockholders of record on September 15th, the right to subscribe to new stock at $50 a share in the pro- portion of one new share for each five shares held; with the right to subscribe expiring on September 30th. The Dividend Clerk after getting his final position for September 15th will write to each of the firms’ customers, who are in a long position on this stock, as follows : “Dear Sir: When the books of the General Motors Corporation closed for Rights on September 15th, your account was long 100 shares, which gives you the right to sub- scribe (at the rate of one share for each 5 shares held) to 20 shares of new stock at $50 a share. The market for these rights is 2% — 2 %. Rights expire September 30th. Will you kindly advise us as soon as possible what disposition you wish made of same.” The day the rights expire (September 30th) the Dividend Clerk receives a record of the final position of his accounts, as some of the customers may have sold their rights since the date when his previous position was taken. The Dividend Clerk must then check off from his position the customers who are subscribing to additional stock, collect all the rights he has left over (these being what customers have not sold or used for subscription) and put in an order to sell the remaining rights. In some houses the Dividend Clerk before selling the rights confers with the Cashier. After the rights are sold he credits the customers who are still long with their proportion of the rights sold. 168 WALL STREET Rights and Warrants There is a difference between Rights and Warrants, which at times, causes some confusion in the minds of stockholders. For example, in connection with the above case, if you were a holder of 100 General Motors, you would receive from the Corporation a “Warrant” entitling you to subscribe to 20 shares. A warrant for 20 shares on the subscription terms of one share for each 5 shares held would represent 100 Rights. On the New York Stock Exchange, the trading is all done in Rights and not in Warrants. When the brokerage firms receive their warrants they cal- culate the number of Rights they represent and this number is recorded on top of the certificate. The transactions as pre- viously mentioned are recorded and handled as rights through- out the office and not as warrants. AVhen customers subscribe to new stock, the Dividend Clerk delivers out on the blotters the rights the customers are long and receives in on the blotters the new stock, charging the customers with the amount of the subscription for the new stock. In some offices, however, this is handled by the Transfer Clerk. Bond Interest There are two general types of bonds — Registered and Cou- pon. The interest payments on the registered bonds are mailed by the corporation to the party in whose name the bonds are registered. Bonds having coupons attached are sometimes regis- tered in the name of an individual or firm, but such registration applies only to the principal and not the interest. The Coupon Bonds have coupons attached. These coupons are dated and on each due date the coupon is detached and forwarded to the bank for collection. AVhen depositing in a bank it is sometimes necessary to attach ownership certificates for income tax purposes. The majority of corporations generally pay their interest (coupon) semi-annually, on the first of the month, but some pay quarterly, while a few pay on odd dates such as the 10th of the month. The Stock Record Department keeps a record of the coupon payment dates in their bond record book. The Dividend Clerk 169 WALL STREET should first examine all the records in the bond record book in order to find out which bonds do not pay semi-annually or quarterly and he should then make a record of these bonds, and the coupon dates in his diary. On the bonds that pay on the 1st and 15th, just previous to these dates, the Dividend Clerk receives a list from the Stock Record Department show- ing the clients who are long and where the bonds are located. For example, Atchison 4% 1996’s pay their interest on October 1st. The Dividend Clerk receives a list about September 29th of customer’s longs and the location of the bonds. After getting this list the Dividend Clerk makes out substitutions withdraw- ing the coupon from the bonds that are in loans. The substitution blanks are filled out as follows : “CHASE NATIONAL BANK” September 30, 1929. Amount of Loan: $100,000 — Rate 7% — Date of Loan Sept. 10. We wish to withdraw the following coupons due Oc- tober 1st on 10M ATCHISON 4/96.” (Firm’s Signature) The Substitutions are then sent out and a few days later the Dividend Clerk will receive the coupons from the banks. After the Stock Record Clerk post all the items for the day the Coupons are payable, the Dividend Clerk then gets a com- plete list of all the securities held, both long and short. On the morning of the first the Dividend Clerk must cut the coupons from the Bonds in the box. On ‘Fail-to-Receive’ items he will either get the coupons from the brokerage houses which have failed on these securities, or a check equivalent to the amount due as represented by the coupons. After collecting all his coupons from the Box, Loans and ‘Fail-to-Receive’ Accounts he then credits all the customers that are ‘long,’ depositing the coupons in the Bank. In depositing coupons it is necessary in some instances to fill out an Ownership Certificate for income tax purposes. There are two forms of these Certificates. A Dividend Clerk has other duties, such as, making claims, following up collection of claims, keeping a record of all the Due Bills issued; keeping a record of all Due Bills to be col- 170 WALL STREET lected ; making up sheets, crediting customers with dividends when payable ; watching ledger accounts, handling payment of dividends; and lastly, looking up differences. Making Claims Occasionally a brokerage house will not get stock in transfer, on the day the books close, in time for dividend, and in other cases may miss the dividend entirely ; that is, the books may close without the knowledge of the Dividend Clerk. The Divi- dend Clerk, if he has the certificates in the office or in loans, will then make a claim for the dividend. If the certificate is in the name of another brokerage house he will make claim, as follows: “Muir & Loomis, 39 Broadway, New York City. Dear Sir: On October 2nd when the books of the Pennsylvania Railroad closed for dividend of $1.50 a share, we held certificate No. 123462 for 50 shares registered in the name of yourselves on which we claim dividend pay- able October 31st. When dividend is payable will you kindly forward check covering this dividend, and upon your so doing, we hereby guarantee to protect you from any further claim for same. Very truly yours, Harris, Winthrop & Company, By (Firm’s Signature)” If a certificate is in an individual’s name the Dividend Clerk makes a claim on the brokerage house or bank guaranteeing the signature, which naturally would be the signature of their client. When the Dividend Clerk does not have the actual certificate, in the event of its having been delivered out of the office, he must write the transfer office as follows : 171 WALL STREET “U. S. Steel Corporation — Transfer Department. Dear Sirs: When the books closed September 12th for dividend on the common stock of your Company we were the holders of Certificate No. 126265 for 25 shares. Kindly furnish us with the name, address, and guar- antee on the certificate. Yours very truly, F. B. CAHN & CO.” If the certificate in the meantime has been delivered by some other party to the U. S. Steel Corporation for transfer, they can furnish you with the name and guarantee. If it has not been transferred, they can only furnish you with the name and address of the individual, and the Dividend Clerk must then claim direct from the individual. When claiming for clients attach duplicate copy of letter to the letter of the party claiming the dividend, so that when the check is received you will know whom to pay. The form used for cash and stock dividends is about the same. The Dividend Clerk simply inserting ‘stock’ when neces- sary before the word dividend. The form for claiming on Rights is as follows : “Livingston & Company, 111 Broadway, New York City. Dear Sirs : On October 3rd when North American Company’s books closed for the issuance of rights, we were the owners and holders of certificate No. 267952 for 100 shares of this stock registered in the name of Charles Adams, and guaranteed by yourselves on which we claim the rights expiring October 29th. Will you kindly collect and forward these rights to us, and upon your so doing, we hereby guarantee to protect you from any further claim. Very truly yours, Eastman, Dillon & Company, (Firm Signature)” 172 WALL STREET The Dividend Clerk must keep a file box and as he makes claims, the duplicate of the claim must be placed in the files in alphabetical order under the name of the stock in question. As the dividends are paid by the various Corporations, the clerk must get out his duplicate claims and collect on them. In most cases after the dividend has become payable, the dividend clerk must continue to follow up the house or in- dividual he is claiming from, as some claims are difficult to collect. On the dividend proof a record should be kept of all due bills received and issued and also of all claims paid. On claims for clients the record is kept in the file, but not on the proof, as these claims when collected are immediately remitted to the client. As checks for claims and due bills are received or paid out, the proof must be marked accordingly. Proofs must be kept together, until all items are settled after which time they are filed away. Generally on the first and fifteenth of each month there are a number of dividends payable. On these dates the Dividend Clerk will write up in advance his credit sheets (copying from his proofs) recording all the dividends that are payable, and showing the credit due to the customer. When the checks are received, he pulls out these sheets together with his proofs. On the proofs he shows what amount he receives from the cor- poration and the amount of any other checks received. The difference between the amount received and the amount cred- ited to customers is then charged or credited to the Dividend Account. On the day on which dividends are payable a notice is sent out to all customers advising them of the dividend credit being allowed them in their account. Checking Up Differences Should the proof show, for example, that you should receive from the corporation a check on 1800 shares on the account of stock registered in the name of your firm, and you only receive a check for the amount represented by 1700 shares, the Dividend Clerk must then recheck his records on the se- curities supposed to be in the firm’s name. If after rechecking 173 WALL STREET there is no error, he must write the transfer office of the cor- poration as follows: “When the books closed September 10th for divi- dend on U. S. Steel Common Stock, our records show we were the holders of the following certificates, to- taling 1800, registered in our name: 126275 — 100 shares 127216/23 — 800 shares 126278/82—500 shares 128215/16—200 shares 128224/50 — 200 shares Total 1,800 shares. Kindly check and advise the name, address and guarantee on the certificate — not registered in our name. Yours very truly, THOMSON & McKINNON” When the corporation answers it will be disclosed that one certificate listed above will probably be in another name. For example, No. 128224 is in the name of Arthur Snyder — 112 East 12th Street, New York City. You then will find out from the dividend proof where this certificate was when the stock sold Ex, and if it is still in the office or in loans you enter a claim from the party guaranteeing the certificate, and, if it is not in the office you claim direct from the above named individual, i. e., Arthur Snyder. It is much easier to make your claim effective if you have the certificate. Sometimes the Loan Clerk will show stock in a loan as being in the firm’s name when it is in another name. Sometimes the Transfer Clerk will send stock to transfer the day the books close and it will be too late to make the transfer. In this event, when the stock comes back, instead of the Transfer Clerk changing his records in the transfer book so as to show the failure to make the transfer as of that date, he might hold the stock in an envelope and send it out the next day to trans- fer without notifying the Dividend Clerk. In this ease the Dividend Clerk will be short in his accounts as he has figured the stock as being in the firm’s name for the dividend. 174 WALL STREET A dividend ledger sheet is kept in the Bookkeeping Depart- ment of all dividends showing over and under payments. The Dividend Clerk must occasionally check up with the Book- keeper to see if he is short on any dividends, as sometimes, he will, in error, file away a proof or mislay a claim, and by check- ing with the ledger it is discovered. In £ brokerage office the dividend record should always show a credit at the end of the year, on account of dividends un- claimed. The amount of the credit depends largely on the ability of the dividend clerk to first see that he is not short on any dividend, and secondly, and of great importance, he must see that he collects on all claims and due bills. He might be over on the regular dividend transactions, but could be over much more and thus show a more favorable balance by col- lecting all claims and due bills and by carefully checking all dividend proofs showing dividends due from all sources. 176 CHAPTER VHI Cashier’s Department CAGE AND CASHIER’S DEPARTMENT The principal duties of the cashier’s department are the financing of the firm’s transactions through the proper opera- tion of its borrowing and loaning facilities, the examination, custody, delivery and receipt of securities and a proper keep- ing of the necessary records to be transmitted to the other de- partments. While the transfer department and the dividend department may properly be considered as an integral part of the cage, they are, for the purpose of this book taken up completely in separate chapters. Excluding these two departments a well organized cage should consist of the following divisions : The Cashier and as many assistants as may be required for the purpose of supervision, financing, and attending to the vast amount of detail connected with the work. The receipt and delivery of securities which would include receive clerks, delivery clerks, head stock clerk, check book clerk, and messengers, loan department, including head loan clerk and assistants. The number of men in the entire department varies, of course, with the volume of work handled. In large houses twenty to thirty men may be necessary whereas in very small houses two or three men would be sufficient. The Cashier The cashier, in addition to supervising all the work in the cage and assuming the responsibility therefor, is mainly con- cerned with the work of managing the finances of the firm. This work requires a great deal of experience and covers not only the clerical viewpoint but a thorough acquaintance with money and market conditions. After ascertaining that the previous day’s work has been completed; that is, seeing that the proper balancing of money and securities has been attended to, the cashier will give his attention to the day’s financial requirements. 179 WALL STREET Figuring Loan Requirements The situation as to this phase of his work will be disclosed by an examination of Night Clearing House balances, odd lot balances, items going through on the Ex blotter, money to be paid to or received from customers who usually buy and sell for cash, time loans falling due and from the other large items which would affect the cash position of the firm. This will give him the preliminary cash position, but these figures are not final as many contingencies arise during the day which will make substantial changes in his requirements. The principal items making such changes are calling of call loans, failed to deliver, failed to receive, which frequently are subject to sudden changes due to the clearing of old items and also the establishing of new ones, unexpectedly large demands from customers and unusually large remittances from customers. The smaller items are not taken into consideration as an adequate bank balance will give the needed leeway. However, after obtaining his preliminary figures the cashier completes a part of his financing by paying off loans or mak- ing new loans as the occasion requires. He will then keep a close check on all large cash items during the day and will make his final adjustment sometime during the afternoon. If he has more money than is required he will loan it out on call or if short will borrow the necessary amount. Call and Time Loans A substantial portion of the money borrowed should be on time, that is, a loan with a fixed maturity and rate of interest. In making time loans, however, the cashier must use his judg- ment as to the future cost of money, and period of time. If in his opinion money is too high he will restrict his time loans as much as possible, so that in the event of a break or decline in money rates, he can take advantage of a lower rate, but on the other hand, if money is low he is in a position to increase his time loans to a reasonable extent. However, as no man’s judgment is infallible, a certain portion of the loans should be on a time basis to prevent sudden demands that might prove embarrassing in a high money market. 180 WALL STREET Bank Requirements The cashier should make it a point to know the requirements of the banks he deals with so that matters of equity, class and classification of securities will be agreed upon with as little negotiation and discussion as possible. Banks require substan- tial margins, diversification, marketability, and the cashier will save endless trouble for himself and his firm by watching these conditions from his side of the transaction in order that these requirements can be met. Loaning Securities Part of the financing may be arranged by loaning stocks at the market price at the current rate of interest, which in effect is borrowing money without the necessity of margin. How- ever, this cannot be done in large enough amounts, and some firms do not loan securities except as an accommodation or where market conditions command a premium to be paid by the borrower of the stock. Responsibility As stated previously, the cashier is entirely responsible for everything that takes place in the cage and it is necessary for him to keep in close touch with the activities of his assistants. He must watch loans, deliveries, the condition of failed to receive and failed to deliver accounts, subscriptions account of rights, exchange of securities, reorganizations, the collection of dividends and bond interest, the payment of principal on callable bonds, remittances and deliveries to customers, etc. The cashier, of course, does not perform the actual work in- volved in all these situations, but as an executive he must know that it is being performed properly. For instance, he will know that a certain corporation is ex- changing all its common stock for the stock of a new corpora- tion on Nov. 15th. On November 10th or thereabout, he will start looking into this situation. First he will instruct the loan clerk not to put any of this stock in loans, and to withdraw all that he possibly can. He will examine the stock in the box and safe keeping departments to ascertain if the certificates are in proper shape for the exchange and will take all neces- 181 WALL STREET sary steps to correct any errors that may exist. He will ex- amine the fail accounts and do everything- possible to expedite delivery. Stock to be transferred will be put through with all possible speed. Thus when the date of exchange arrives he will be well prepared to effect it without a last minute rush and the consequent disarrangement of his routine. The above action should be taken in all matters that cannot he handled properly by the dividend department. The cashier is usually the chief executive of the entire clerical force and as such must hire, discharge, regulate salaries, attend to the pay roll, see that the work is properly split up, and ap- portioned so that no one is overburdened, and should strive to maintain a spirit of helpfulness and co-operation throughout the entire organization. In the larger offices there is a general manager who lifts considerable of the burden of much of this work from the cashier. In such case the cashier can devote his entire time to cage operations, but in the absence of a manager these numerous duties would fall to him. The Loan Clerk The duties of the loan clerk are to keep an exact and com- plete record of all collateral loans, both time and call. This includes name of lender, amount of loan, maturity, rate of interest, changes in call money rate, description and amount of collateral, market price, total market value of collateral, the amount of equity or margin, numbers of certificates, identifi- cation of certificates in loans by some mark which will indicate that they are not in the firm’s name, substitutions, date of entry and withdrawal, and the figuring and payment of interest. Method of Procedure The work of the loan clerk for any stated day starts during the afternoon of the preceding day. As soon as the records are available he will ascertain what securities are needed for de- livery or transfer the following day. This is effected by an examination of Clearing House balances, odd lot sheets, trans- fer records, instructions covering delivery for the account of customers and a report from the dividend department showing 182 WALL STREET stocks on which the books will close for dividend on the next day. After obtaining this information he will have a complete picture of the next day’s requirements, and the next step is to consult the stock record covering each class of security, which will disclose where the desired securities are located. Substituting Considerable judgment must be used by the loan clerk in arranging his substitutions so that he can withdraw the se- curities with a minimum amount of recording. For instance should he discover that many of his requirements are in one call loan it would be more advantageous to pay off this loan entirely than to make a substitution. On the other hand this call loan may have been running for a considerable period of time, it may be very advantageously placed and it would be better to substitute in this case. As a matter of fact many so-called call loans have been running for years and most every brokerage office has one or two of this character. Continuing with the work of preparing substitutions let it be assumed that 600 shares of American Can are required for all purposes. The stock record shows 500 shares in the box, thus only 100 shares must be obtained from loans. The dividend department shows Baldwin Loco selling ex-dividend, stock record shows 100 shares in Seaboard National Bank, loan of September 15, and an examination of the loan sheet shows that this certificate is not in the firm’s name. This must also be withdrawn in order to transfer it and obtain dividend. The Dividend department also shows Consolidated Gas selling ex- dividend, and stock record shows 200 shares in same loan, but the loan sheet shows that the certificates are registered in the firm’s name. Therefore it is not necessary to substitute for this item. In the case of Baldwin, if there were additional stock in the loan it would be necessary to state the number of the certificate desired, in this case, A625, as disclosed by the loan sheet. In order that these various steps may be plainly shown, an example showing the details in the record of a time loan is presented below. This loan is supposedly made with the Sea- board National Bank on September 15, and shows the substi- tutions noted above together with such other securities as are required. 183 WALL STREET TIME LOAN Borrowed from Seaboard National Bank $100,000 Date Made, Sept. 15, 1929. Date due April 15, 1930. Rate 6%. Date Date Deposited Withdrawn Description Shares Price Value Numbers Sept. 15 Am. Can 100 131 13,100 (26423) Baldwin Loco 100 32 3,200 (A 625) Beth. Steel 100 103 10,300 5995 111. Central 200 128 25,600 32681-32682 General Elec. 200 210 42,000 964-1128 General Motors 300 54 16,200 10102-10143 (694682) Con. Gas 200 115 23,000 16225-16226 Cont. Baking A 200 50 10,000 143,400 11240-19863 The loan sheet shown above is self-explanatory with the ex- ception of the brackets around certain certificates. This is to indicate that these certificates are not in the firm’s name and must be withdrawn when American Can, Baldwin Locomotive and General Motors close their books for dividends or reorgan- izations of any kind. The records which the loan clerk has obtained from the sources previously stated indicate that 100 Amer. Can, 100 Baldwin Loco, 100 Beth. Steel and 200 Illinois Central must be withdrawn from this loan and he accordingly makes out the following substitution blank : “New York, November 1, 1929. The Seaboard National Bank, New York, N. Y. Gentlemen : Please deliver to bearer from LOAN September 15, 1929, of $100,000, the following securities valued at $52,200 : 100 Amer. Can 131 $13,100 100 Baldwin Loco 32 3,200 100 Beth. Steel 103 10,300 200 Illinois Central 128 25,600 52,200 184 WALL STREET and and substitute the following securities valued at $52,700 : 200 Radio 43 $ 8,600 200 U. S. Steel 190 38,000 100 Rem. Rand 36 3,600 100 Shell Union 25 2,500 52,700 oblige. Yours respectfully, F. B. CAHN & CO.” The top part of the substitution or withdrawal is made up on the previous evening and the substituted securities listed the next morning when the boxes are available. Again much judg- ment must be used in substituting, as the character of the loan, condition of the box, etc., are all important contributing factors in the arranging of loans. Classes of various loans are round lots, odd lots (less than 100 shares) listed, unlisted, mixed, special, etc., and the substitutions should conform to these specifications. Bearing in mind the fact that more loans will probably be made during the day with a consequent additional demand upon the box, the loan clerk should make his substitutions so as to leave a sufficient reserve of acceptable collateral for this purpose. In other words the box must be left in good shape for the demands that may be made upon it. The above substitution does not by any means represent the entire day’s work. The securities withdrawn for substitution in this case were those that were required from the loan of September 15, but many other loans would be involved. In a busy market it would probably be necessary to make from 15 to 75 substitutions in connection with the various loans. The substitution blank is made in duplicate, the second copy being retained by the loan clerk. When he receives the with- drawn securities the loan clerk enters the numbers of the certi- ficates on the duplicate so that proper notation can be made on the loan sheet. He also takes a record of the numbers of the certificates of the substituted securities. The Loan Sheet After completing all records after this substitution the loan of September 15 will appear as follows: 185 Borrowed From Seaboard National Bank $100,000 W ALL STREET cd (V Ph o CO 03 oT Q 0) o3 Q 03 CM 03 Ph m OOQQSccK > > o o z a 0) 72 > o £ > o 3?: 186 Shell Union 100 25 2,500 50/-19682 25/16284 (25/19225) 143,900 WALL STREET When the withdrawn securities have been eliminated from the loan, the loan record sheet would appear showing a line drawn through the name of the securities withdrawn, including the price, valuation and numbers of certificates and would show the substituted securities properly entered. In the fore- going example the four items checked would be shown on the record with a line drawn through them. It will be noted that the item of 100 Shell Union consists of one 50 share certificate and two 25 share certificates. The price and value of the stocks are entered in pencil in order that they may be changed readily. Maintaining Proper Equity In analysing this loan it is seen that there is an equity of $43,900 or a margin of nearly 44%. This is of course rather high in normal times, but as a matter of fact, about 40% was required by the banks just before the enormous break in the market in October-November, 1929. Bankers realized that securities were selling very high and made every effort to ob- tain the maximum protection. After the November break the requirements were reduced to about 25%. In any severe fluctuations either up or down, the loan clerk must refigure valuations so that the equity will be kept at the proper level. This is done by changing all prices to the market value and adding additional collateral if the equity is low or by withdrawing collateral if the equity is too high. Payment of Interest All interest items pertaining to loans are in charge of the loan clerk. It is the usual custom to pay all interest charges at the end of the calendar month on both time and call loans. After figuring interest on all loans, the loan clerk lists each item and sends it to the check clerk who draws the checks to the various banks and charges the entire sum to interest account. The usual loan sheets have columns on the right hand side providing for figuring the interest. In the illustration given, a time loan of $100,000 was made on September 15, 1929, 7 months at 6% due April 15, 1930. The interest calculation would appear as follows : 187 WALL STREET Date Rate Days Amount Sept. 30 6 15 250 Oct. 31 6 31 516.67 Nov. 30 6 30 500 Dec. 31 6 31 516.67 Jan. 31 6 31 516.67 Feb. 28 6 28 466.67 Mar. 31 6 31 516.67 Apr. 15 6 15 250 The loan being made on September 15, there would be $250 due and paid on September 30, representing 15 days at 6%. On October 31, the interest would amount to $516.67, and so on until the loan matures. Interest on call loans is figured on an entirely different basis, as call loans are subject to a daily change in rate. For illustration let us assume that the loan of September 15, for $100,000, was a call loan, eventually paid off on November 14, 1929. The interest calculation would appear as follows : Date Rate Days Amount Sept. 15 9 5 20 10 9 29 8 1 $125 250 22.22 Interest paid Sept. 30 $397.22 Sept. 30 8Y a 3 Oct. 3 71/2 3 6 8 10 16 9 15 70.84 62.50 222.22 375 Interest paid Oct. 31 $730.56 Oct. 31 8 4 88.88 Nov. 4 6 10 166.67 Interest paid Nov. 14 $255.55 188 WALL STREET The loan was originally made at the call rate of 9%, but changes in rates were made on September 20, September 29, September 30, etc., as shown above. Interest payments were made on September 30, of $397.22; on October 31, of $730.56; and again, at payment of loan, on November 14, $255.55; total- ing $1,383.33. The original rate of 9% was maintained for only five days as the rate was changed to 10% on September 20. In figuring interest on call loans in this manner there is con- siderable work involved and a great saving of time may be effected by another system which is covered by the following rule : For each $100,000 principal amount multiply the rate by the number of days, increase two decimal places and divide by 6 twice. Exactly the same result would be obtained and it is considerably simpler, as shown by the following examples: Date Rate Days Amount Date Rate Days Amount Sept. 15 9 “ 20 10 “ 29 8 Total 5 4,500 9 9,000 1 800 6 ) 14,300 6 ) 2,383.33 Interest paid Sept. 30 397.22 Sept. 30 81/a 3 2,550 Oct. 3 71/a 3 2,250 6 8 10 8,000 16 9 15 13,500 6 )26,300 6 )4, 383.33 Interest paid Oct. 31 730.56 If the loan were $50,000 the interest, of course, would be divided by 2 or $198.61. A principal amount of $200,000 would call for interest of $794.44, etc. This system is particularly effective when a great many rate changes occur during the month. It is nothing unusual for the rate to change daily and under the first system this would involve 30 different interest computations, whereas the short- ened method would involve only simple multiplication and division. Transmitting Information to Stock Record A resume of the entire day’s operations must be given to the stock record clerk in order that a security balance may be reached. Following is the usual form of memorandum used for this purpose : 189 WALL STREET Q W « W > >— i w Q Q W t> >— i O W Ph d u cS t 5 o p CS m d ffl w a § § Q

Pi d -a a> 2 «i C8 (S £ d pi pi frn . 2 .2 .2 r d r r3 r r3 r ^ >> d d d p p p p ti ^ o o o o PD „Q ,0 d! Sou® P CO 05 M d PI .2-* -£ pi =3 03 £ M 0) . : oS. d Pi rd O MODMJCOOQOOU dddddddd 4) O) 0) 4) Pddd p £ r. H PI Pi © CO 03 d W co +- 1 <® r") ^•9 02 d <1 ^ p £ . r 2 ^ p (Bdd'-'-rt © Cj i— H -+J , H fi w cd a> r— ( a> S 3 < 5 pqcqpiO o o rH b- o o u a> s s -3 o o m u o .3 a ^ s a 9§ H o o co 190 200 Wright Martin “ Commerce 100 General Elec. “ Commerce 100 Westinghonse “ Commerce WALL STREET Different systems are in vogue in different houses. In smaller firms all entries are put on the blotter, while others use the duplicate substitution sheets, new loan sheets and loans sheets representing loans paid off for the purpose of the stock record. In a number of houses the securities in loans are entered as one item on the Stock Record under the title of (Hypo) instead of individual bank items. In this event it is necessary for the loan department to keep a separate record listed under the name of the security. In other words, a cross index showing in what loans each kind of security is located. Qualifications The success of a loan clerk depends in a large measure on his ability to analyze the many situations with which he will be confronted as well as in keeping a strict and accurate record of the work involved in all transactions, which should be checked by sending a complete list of the collateral to the banks each month, for confirmation. The capital of his firm, its relation with the banks, and the class of securities handled are all important factors to be considered by the loan clerk in arriving at his decisions. This mature judgment can be ob- tained only through actual experience and an intensive study of all conditions surrounding his duties. An instance of the problems which arise may be illustrated by the following situation: The loan clerk after an examina- tion of all balances finds that a large sum of money, say $1,000,000, will be gained through delivery of securities. It not being good policy to increase bank balances to this amount, it is therefore necessary to pay off loans aggregating approxi- mately this amount. However, in paying off he must be careful not to disturb any special loans which for various reasons should remain intact. Furthermore, he should pay off the loans in which most of the desired securities are located, thus cutting down the substitutions to the minimum. Receipt and Delivery of Securities For the purposes of this book the duties of the stock clerk and the delivery and receive clerk have been combined. In some of the larger firms these duties may be split up among 191 WALL STREET any number of men but the general method of operation is practically the same. The stock clerk in this instance therefore has custody of the securities, receives and delivers securities, examines them for any flaws which would make a bad delivery, and originates the entries for failed to deliver and failed to receive accounts. The check book and the blotter are also under his supervision or may be handled directly by him. At the start of the day’s work the stock clerk will examine the Clearing House security balances, the deliveries to be made on ex-blotter, and all securities to be delivered. He will then make up his Clearing House receive and de- livery sheet (Form A) ; Curb Clearing House receive and de- livery sheet (Form B) ; Odd Lot receive and delivery sheet (Form C) ; and Cash Blotter (Form D), which would appear as follows after the completion of the day’s work : 192 NEW YORK STOCK EXCHANGE SHEET WALL S T R E E T ot w > w w W Q IS o S5 HH « < W J O s • «j c o= =\®« CO <*H ^e-irj iO ©\ *c t- lO T* cb m « 53 a • -So o O o* « «y Q <3 o O c*3 >» oj O <« ctf n-S-ses sh o ^ 52 ^ 33 -=< © o-~ © o bfl & a cS « fc* offljW W a 3 a Gn Hi M — « CO io ™ •2 »H COci CO rf 00 oa 03 © feQ oo oa ca co ■**" id o o oo o t-oco 3? o * o;g “ < 03? s a s< O W «8 =8 a .2 £ is 6 J eoa S ua “ ej 3 H ® Bin SW © 00 cd © PQ C . «3 aj • . CQ JCOW co m OCOincd Oco^oco OCDcCioOh^OCO ooo^ooincg^min o Cl t* t- CO CO © ® “ £ o 05 5 -< «3 ja « a offlO © © © © © 05 P$P4£ ^ 03 o g s £ £ s w • Securities received from customers. Deliver Side Line No. 2 — Bank Balance — opening of business. “ “ 4 — Check received for account of Horace Jones. “ “ 6 — 20 shares Cons. Gas, Balt. Pfd., sold for account of Samuel Brown. Commission and tax deducted. “ “ 8 — 60 shares National Casket, sold for account of Harry Gold. Commission and tax deducted. Failed to deliver to Thompson & Co. “ “ 10 — Dividend on 500 Cities Service credited to account of Frank Isaacs. “ “ 12 — Loan for $50,000 made with Hudson Trust Co. “ “ 14 — Offset entry line No. 7. Fail to receive. “ “ 16 — Settlement check from Carlisle & Co. (Form C). “ “ 18 — Total commission on cash blotter, including lines No. 5 and No. 7 on receive side. “ “ 20 — State Tax. “ “ 22 — Federal Tax. “ “ 26— Total credit addition. Deliveries to Customers. 202 WALL STREET Proof of Balance Blotter Balance (3 P. M.) (Line 17).. $116,536.45 (10:00 A. M.) Cheek Book Balance $120,922.45 Deposits Horace Jones (Line 4) Noble & Co. (Line 6) Cities Service Co. (Line 10) Loan Hudson Trust Co. (Line 12) .... Carlisle & Co. (Form C) Left & Company (Form B) Pink & Company (Form B) Check Drawn Bank of Commerce (Line 1) 40,216.25 John Peters (Line 3) 863.32 Potter & Company (Line 5) 2,180.00 Stock Clearing Corp. (Form A) 17,486.43 Cap & Co. (Form B) 7,300.00 Keen & Co. (Form B) 3,000.00 Baker & Company (Form B) 1,200.00 72,246.00 5,000.00 2.150.00 150.00 50,000.00 5.560.00 2 . 100.00 2,900.00 188,782.45 (3 P. M.) Check Book Balance . . . $116,536.45 Proof of Fail to Receive and Fail to Deliver As the aggregate sum of the fail accounts is placed in the ledger it is necessary to check these accounts periodically with the blotter clerk who keeps a detailed record of all open trades. From the bookkeeping balance it will be noted that the failed accounts are posted as follows : Fail to Deliver (Dr) $18,726.87 3.200.00 1.740.00 7.500.00 Fail to Receive (Cr) $15,175.22 2,000.00 1,900.00 850.00 $31,166.87 203 $19,925.22 WALL STREET The record kept by the blotter clerk would appear : Fail to Deliver (Dr) Streit & Co. 100 Cons. Cigar 50 $ 5,000.00 Bloch & Co. 100 Corn Prod. 80 8,000.00 Nowell Co. 100 Childs 48 4,800.00 Lamb & Co. 1M 111. Cen. 4/53 88 926.87 Pell & Co. 100 Graymur 32 3,200.00 Carlisle & Co. 30 Royal Dutch 58 1,740.00 Thompson Co. 60 Nat’l Casket Fail to Receive (Cr) 125 7,500.00 $31,166.87 Smith & Co. 100 Radio 43 $ 4,300.00 White Co. 100 Amer. Can 100 10,000.00 Camp & Co. 1M Ann Arbor 4/95 86 875.22 Horn & Co. 200 Ark. Gas. 10 2,000.00 Carlisle & Co. 50 Radio 38 1,900.00 Cole & Co. 50 Rolls Royce 17 850.00 $19,925.22 Bookkeeping- Balance Assuming that the price indicated on the N. Y. Stock Ex- change Clearing sheet and the Curb Clearing House sheet were exactly the same as the actual purchases, the bookkeeping entries would appear as follows : 204 From Stock Exchange C. H. Blotter 87,065.12 Customers 63,130.34 Customers WALL STREET 0^0®° C> s «•§«§« OJ GO "S r0 cs , s S ti 1-3 p4 u pC| O 03 O O O © O 03 O O p P O id o o’ o o o t- o o © o 03^ rH^ ©^ 05^ □o' irT o' of in' i-T 0> 0> 0) Q Q G cd cd cd o c- o co o co O 03 ION of oo" o o o o 03 o o < 73 PQ P4 m lO 03 03 03 o' 03 g g o i_J • Hr • l5 <=8 ° A « ©OOOOOlOOO O 03 CO O © © 03 CO CO O' ^ 03 03 O t“H rH t—H o ^ co in o in co O r - 1 tH i-i o co lO 03 t- o lO Ph g _3 fi OR 0 Q m M a ■ ■ cS PR <1 Rh ono O 03 O Scoo oo m o Hoom 03 C « O 1 C o 03 O c 6 o T— ( C 03 O o' 3-i Q} -M ^ 43 o> © a> - m m WH- 003 0> Qj X GG M d ) s i 1 o -*-3 o - s o f, « -f 3 5h ^3 rj} 3 o- cd O K oo O 205 292,389.26 $292,389.26 WALL STREET While the stock clerk would not, of course, take off a book- keeping balance, it has been shown here to illustrate how the various entries are brought into reconciliation. Security Balance The stock clerk, however, also has his part in balancing the securities. The stocks taken from the boxes and loans, put in the boxes and loans, and in and out of transfer are properly recorded by the loan and box clerks. To complete the record it is necessary to give the stock record clerk a list of fail to receive and fail to deliver items. The securities are balanced in the following manner: Amer. Meter 20 shares E. Summers (Form D Line 5) 20 shares Transfer Rolls Royce 50 shares Arthur Doyle (Form D Line 7) 50 shares Fail Receive National City Bank 60 shares S. R. Bachmans (Line 23) 60 shares Box National Casket 60 shares Fail Deliver 60 shares Harry Gold (Line 8) When the bookkeepers receive the sheets they do not post any items marked C. H., as these are merely balances trans- ferred from other records. The check received from Carlisle Company (Form D Line 16), while not properly a Clearing House item, is marked in this manner to eliminate any pos- sibility of posting. Eliminating Fail Accounts It is the duty of the stock clerk to keep both fail accounts down to a minimum, particularly fail to deliver. If this ac- count is allowed to mount higher and higher it is very costly to his firm in interest. He must make every effort to obtain the securities necessary for delivery and if the fail to deliver items do not clean up rapidly, he must borrow the stock if it represents a short sale or insist on delivery of the stock if 206 WALL STREET coming to him through some other source. Small fail accounts are indicative of a good stock clerk. In order to expedite delivery it is sometimes necessary to send a “buy in” to the broker from whom the stock was pur- chased. For this purpose the following form is used : New York, To In case of non-delivery of due the undersigned before 2 :15 P. M. today, the same will be bought in “under the rule” for cash for your account. Respectfully yours, ORIGINAL PARTIES TO THE ABOVE NOTICE : The order to the New York Stock Exchange will be given by to buy in for account of Date of original contract If the stock is not received by 2 :15 P. M. an order is placed on the floor to buy it for immediate delivery and the difference in price is charged or credited to the broker failing to deliver and the original failed item is cancelled. If a stock clerk receives a “buy in” notice, he should take immediate steps to protect his firm. If the stock is in the fail to receive account the “buy in” should be passed along or if short, effort should be made to borrow. Many items go into the fail to deliver account through the carelessness or inability of the loan clerk, who neglects to sub- stitute for the desired security. In this case the stock clerk must insist on obtaining the security at once. Reverting to Figure 24, Form A, there are several fail items which, when finally delivered would appear on the cash blotter as follows : 207 WALL STREET CQ m CD CD O0 IM H pQ 00 03 4-H Pi 03 p 00 p o a o o id o o o CO GO p o a o O O CO O O O CM ooooc! o t-H id cd CD CD a 'S O CO CD O ^ GO CD ‘3 O O GO OO lO GO ^ GO P-i P *o Oi C fl u £ t? £4 o H rH O 4-3 PH • rH u cd m rH Pt s ° rl ^ Pi • O ^ 4-H P. ■C CD m P rrj >r a> o ^ o£ p M t/3 0) \ -I u -± WALL STREET Form No. 11. Acknowledgment on a Detached Assignment Made by an Individual. State of ) ss County of \ ' On this day of 19. . . before me, a Notary Public for the County of personally came to me known to be the individual named in the annexed Certificate of Stock (or Bond) and described in and who executed the foregoing Instrument, and acknowledged to me that he executed the same. [ SEAL ] 225 WALL STREET Form No. 12. Acknowledgment on a Detached Assignment Executed by a Firm. State of . . County of On this day of 19... before me, a Notary Public for the County of personally appeared to me known and known to me to be one of the firm of named in the annexed Certificate of Stock (or Bond) and de- scribed in and who executed the foregoing Instrument, and acknowledged that he executed the same as the act and deed of said firm. [ SEAL ] If used for a firm that has dissolved, see instructions in Form No. 3. 22G WALL STREET INDEX TO RULES FOR DELIVERY Rule No. Acknowledgments Notarial. Forms 2-7, 11, 12 29-34 Administrators Rights in Name of 23 Securities in Name of 7 Affixes to Names and Signatures 28 Agents Rights in Name of 23 Securities in Name of 7 Alterations of Assignments 33 of Notarial Acknowledgments 34 Assignments Date of 28 Detached, Form 10 29 by Insolvent 3 of Rights 20 of Securities 29-34 Signatures to 28 Assignees Rights in Name of 23 Securities in Name of 7 Attorneys Rights in Name of 23 Securities in Name of 7 Buyers Options — Interest 35, 36 Calcellation of Name filled in for Transfer 14 Claim for Dividends 17 Contracts — Settlement of in Bonds exceeding $1,000 1 2 in Stocks exceeding 100 shares ) 227 WALL STREET Rule No. Corporations Rights in Name of 23 Securities in Name of 6 Correctness of Signature Guaranteed 15 Coupon Bonds Endorsed 18 Denominations of 1 (d) Interest 36, 40 Coupons 1 (d), 42 Dates of Assignments and Powers of Substitution 28 Deceased Persons Rights in Name of 22 Securities in Name of 7 Defaulted Interest 37, 38 Delayed Delivery Contracts Delivery of Bonds. 2 Interest on 35, 36 Delivery by Transfer 16 Denominations of Bonds and Stocks 1 of Rights to Subscribe 20 Detached Assignments 29-34 Dividends Claim for 17 Due Bills for Registered Bond Interest 39 for Rights 25 Redemption of 25, 28 (f) Signatures to 28 Endorsed Bonds 18 Endorsement See ‘Endorsed Bonds” See “Guarantee” Executors Rights in Name of 23 Securities in Name of 7 Filled in for Transfer Securities — in error 14 228 WALL STREET Rule No. Firms — Securities in Name of Ceased to exist do Rights Dissolved Insolvent Foreign Residents Securities in Name of Forms (see Special Index at end) Fractions of Cents Guarantee of Signaturel (b) (c) (e) (g) . Guardians Rights in Name of Securities in Name of Income Bonds (Interest) Infants Securities in Name of Insolvents Institutions Rights in Name of Securities in Name of Interest Interest-Paying Bonds Coupon Income Registered Defaulted Interest Delivery on Interest Dates Fractions of Cents Irrevocable Assignment Form 1 Detached. Form 10 Married Women Rights in Name of Securities in Name of Missing Coupons Notarial Acknowledgments Forms 2-7, 11, 12 4 22 5 12, 13 43 15 23 7 41 . . . 7 . . . 3 ...23 . . . 6 .35-43 . .. 35 36, 40 . . . 41 39, 40 37, 38 . . . 42 . 43 1 (a) (b) (c).. 29 21 8 1 (d) 229 8 , 10 , 11 29-34 WALL STREET Rule No. Odd Lots 1 (a) Official Designation Securities with 6 Options Interest on Buyer’s or Seller’s 35, 36 Personal Liability Stocks 16 Powers of Substitution to be Witnessed 1 (c), 15 Date of 28 Prefixes to Names and Signatures 28 Receivers Rights in Name of 23 Securities in Name of 7 Reclamations 27 Registerable Coupon Bonds 1 (e) Registered Bonds Denominations of 1 (f) Interest on 39, 40 Release by Transferee 14 Released Endorsed Bonds 19 Return of Securities — See “Reclamations” Rights to Subscribe 20-26 Seller’s Options Interest on 35, 36 Separate Assignments. Form 10, 29 Signatures to Assignments, etc 28 Signature Guaranteed 15 “Ten-Day Rule” — See “Reclamations” Time Option Contracts in Bonds Interest on 35, 36 Titles 28 Transfer Books Closed Indefinitely 11 Claim for Dividend during Closing 17 Transferee Filled in Error 14 230 WALL STREET Trustees Rights in Name of 23 Securities in Name of 7 Unit of Deliveries Rights 20 Securities 2 Unmarried Women Rights in Name of 21 Securities in Name of 9, 10 Widows Rights in Name of 21 Securities in Name of 10 Witness by Deceased Person 4 by Member of Exchange 1 (b) (c), 15 Notarial Acknowledgment by Forms 8, 9 32 Women Rights in Name of 21 Securities in Name of 8, 9, 10 Form Forms No. Acknowledgment for Firm 3, 12 Acknowledgment for Individual 2, 11 Acknowledgment for Insolvent Firm 7 Acknowledgment for Insolvent Member 6 Acknowledgment for Husband and Wife 4 Acknowledgment for Unmarried Woman or Widow 5 Assignment on Stock Certificate 1 Deposition by Witness for Firm 9 Deposition by Witness for Individual 8 Detached Assignment 10 Power of Substitution 1 (a) The above rules for delivery have been established by the New York Stock Exchange. Special rules are at times made covering situations that are the results of unusual conditions. 231 CHAPTER IX Transfer Department TRANSFER DEPARTMENT The transfer department is the connecting link between the brokerage office and the corporation issuing the securities. Its principal functions are, to have stocks registered in the names of the new owners, to exchange one kind of security for another where there is a stock split, merger, reorganization or con- solidation, to turn securities back to the issuing corporation and receive the money for them when there is a redemption, and to subscribe to new stock for customers who hold rights and wish to exercise them. Instructions to Transfer and Disposition of Stock The ordinary case of transfer is the one where a customer buys stock outright, i. e. pays for it in full, and requests that the stock be transferred to his name and delivered to him. The pro- cedure for such a transaction is, as follows. First the Margin Department makes out instructions to transfer the stock to the customer’s name. The instructions state the kind of security, the number of shares, the name and address of the customer, and whether to ship (deliver) or to hold (put in safekeeping). These instructions are given to the Cage. The Cage procures stock which corresponds with the kind and amount specified in the instructions from the Margin Department. The instructions and the stock are then passed on to the Transfer Department. Recording the Transfer (Outgoing) The Transfer Department first makes a permanent record of the transaction in the Transfer Book, consisting of an entry which records the number of shares, the description of the security, the certificate numbers, to whom transferred, and the date the certificates are sent to the Transfer Agent. Each certificate has a place or form for filling in an assignment. The certificates are next given to the typists who fill in the name and address of the customer to whom the stock is to be transferred. The typist then returns the stock to the Transfer Department. 235 WALL STREET Transfer Taxes On all transfers of stock there is a Federal Tax, and in many states, including New York, there is a state tax as well. The Federal tax is 2c on every $100 par value of each share. If it is a security of no par value it is 2c a share. The New York state tax is exactly the same as the Federal tax. Stock transfer stamps for the right amount of the tax are affixed and the certificates are sent to the Transfer Agent of the issuing cor- poration who gives the Transfer Department of the firm a receipt for them. A law has been passed in New York State whereby the transfer tax is eliminated if the individual or firm making the transfer will certify that there is no change in ownership involved. This is accomplished by the use of a rubber stamp in general use in all brokerage offices. The same law has been in elfect for several years in respect to Federal Transfer Tax. Every corporation, whose securities are dealt with on the New York Stock Exchange, must have a transfer office in New York City. This may be an office of its own, or as is gener- ally the case with the smaller corporations, the office of some agent such as a bank. Recording the Transfer (Incoming) Twenty-four to forty-eight hours after the certificates are sent to the transfer agent, new ones are issued in the customer’s name, and returned to the transfer department of the broker. When these are received an entry is made on the Transfer Book, recording the date returned and the new certificate numbers. Stocks placed in transfer before 12 o’clock noon are ready after 1 :30 P. M. on the following day. Stocks reaching the transfer agent after 12 Noon and up to 2 :15 P. M. are not ready until after 1 :30 P. M. on the second following day. Regular time limit on stocks going to transfer is 2 :15 P. M. excepting on ex-dividend dates on which day the time is extended to 3 P. M. The certificates are then passed on to the shipping depart- ment, which mails the certificates to the customer. Certificates are sent by registered mail and the customer mfist sign a 236 WALL STREET receipt, which is returned to the transfer department. The transfer clerks then file these registered mail receipts for permanent record. Frequently a customer does not wish to have the stock he has purchased outright transferred to his name or delivered to him. In that case, the securities are transferred, as above, to the firm’s name instead of the customer’s. When the stock is returned the firm signs it, and the securities are put in safe- keeping for the customer’s account, and are held subject to his instructions. Transfers to Obtain Dividend When a corporation pays a dividend on its stock, it only pays it to those in whose name the stocks are registered in the cor- poration’s books on the date the books close. Therefore when an announcement is made that the books close for dividend purposes on a certain day, all stock that the broker holds, which is not in the broker’s or the customers’ names is trans- ferred to the broker’s name. The Dividend Department takes note of which stocks are selling “ex-dividend” (books close) and sends all such stocks to the Transfer Department to be transferred. This is done in order that the broker will receive the checks for the dividends when payable, and may credit his customers who are entitled to the dividends. Mark (X) in Lieu of Signature Certain special problems arise in transferring the stock from one name to another when they are not in the name of an ordinary individual. One of these problems is where one of the broker’s cus- tomers who cannot sign his own name, sells stock registered in his name. The stock, in order to be accepted by the broker to whom it was sold; i.e. to make “good delivery”, must be transferred to the name of the broker selling the stock. The customer must make a cross where he is to sign, and his mark must be acknowledged and attested to by two witnesses, who must give their names and addresses in full. Stock in Name of Corporation A second problem arises where the stock is received by the transfer department in the name of a corporation. To avoid 237 WALL STREET confusion, it is necessary here to distinguish the corporation previously owning the certificates, and the corporation which issued the certificates. For convenience, we will call the former, the owning corporation, and the latter, the issuing corporation. Stock in the name of the owning corporation is not a good delivery, and will not be accepted by another broker unless it is transferred to the firm’s name. The Transfer Agent of the issuing corporation will not make the transfer unless a resolution is given to him. This resolution must be made out by the Secretary of the owning corporation, giving some other officer of the owning corporation, either the president, the vice-president or the treasurer, the right and power to sell, assign or transfer the number of shares the officer sold. The resolution must have the owning company’s corporate seal and must be acknowledged before a notary public. Stock in Name of Partnership A third problem arises when stock is sold, which is in the name of a partnership. Before it can be delivered it must be transferred to the name of the firm. The transfer agent requires the signature of all the partners and an affidavit, acknowledged before a notary public, stating that those signing are the part- ners. The rule does not apply if the partnership in whose name the stock is registered, is a Stock Exchange Brokerage House. Stock in Name of Estate or Deceased Person A fourth problem arises when stock is to be transferred which is in the name of an estate, either as a legacy from some one deceased leaving a will or from some one deceased, leaving no will. If the deceased died testate, (leaving a will) it is necessary to have a copy of the will, certified by the courts, a Probate Court Certificate showing the appointment of the executor of the estate, who signed the stock certificate for sale, and a New York waiver. In certain cases it is necessary to have an affi- davit, signed by some other person than the executor, stating that all debts, legacies and claims have been paid or are pro^- vided for. This affidavit is required if the certificates are being transferred to the executor’s name and are not being sold on behalf of the estate. 238 WALL STREET In order to transfer the stock if the deceased died intestate, (leaving no will), a Probate Court Certificate showing the appointment of the administrator, and a New York waiver are needed. An affidavit also is required in these cases as it is when the deceased dies testate. Exchanges of Stocks Where one corporation consolidates with another corpora- tion, as for example, when Royal Baking Powder and Fleisch- man consolidated to form the Standard Brands Co. Inc., or when one merges with another, as when the Standard Oil Co. of Indiana merged into the Pan American Petroleum Co., (the new stock being called the Pan American Petroleum Co. Inc.,) or when a corporation is reorganized, new stock is generally ex- changed for the old. In such a case, the customer holding the old stock, instructs the transfer department to exchange the old for the new for his account. The transfer department then makes a “switch”, delivering the old stock to the transfer agent out of the customer’s account and receiving the new stock in for the customer’s account. Stock Dividends Sometimes the surplus of a corporation is out of proportion to its capital stock. Very often, in such a case, the board of directors decides to declare a stock dividend. This is known in Wall Street as a “stock split.” For every old share of stock a certain amount of new stock is exchanged. For example, United Gas & Improvement old is exchanged at the rate of five new shares of common stock and % share of preferred stock for each share of old stock, or again, Packard Motors is exchanged at the rate of five new shares of common for one old share of common. When this happens the transfer department delivers out the old stock to the transfer agent and receives the new stock propoidionately for the customer’s accounts. Redemption of Bonds and Preferred Stocks In many cases when corporations issue bonds or shares of preferred stock, they stipulate that the corporation reserves the right to redeem, or call these stocks or bonds in at certain times and at certain prices. When these stocks or bonds are 239 WALL STREET called for redemption, a list of those that are called is sent to the transfer department of the brokerage office. If any of the firm’s customer’s accounts have any of the bonds or preferred stocks called, the transfer department sends them to the trustee of the corporation, and receives a check from the corporation in payment of them at whatever price the bonds or stocks are called. The bonds are then delivered “off” those accounts in the ledger, and the accounts are credited with the proceeds. Obtaining and Exercising Rights Sometimes a corporation decides to increase its capital stock by issuing rights to subscribe to new shares of the same stock, instead of declaring a stock split. These rights are issued to all stockholders of record the day the books close, i.e., the day the stocks sell ex-rights. Rights are usually good for a month or two and sometimes for longer periods but if they are not exercised within the time specified, and the new stock sub- scribed to, they expire. For example, a corporation might issue rights providing for a 20 per cent increase in their stock, and allow old stockholders to subscribe for one new share for every five shares held, to every stockholder of record on Sep- tember 27. The current market price of the stock might be $40, but the rights give the stockholders the privilege of sub- scribing for the stock at $30.00 per share, with the stipulation that the rights to subscribe for the stock expire October 27. In this case the proportionate value of the right attaching to each share would be $2.00, and to take advantage of this offer the stockholder must subscribe for the new stock before the 27th of October. The transfer or dividend department furnishes the customer with the full particulars concerning the rights, and asks the customer to advise the transfer or dividend de- partment if he wants the rights exercised. The customer, if he wishes to exercise the rights, instructs the transfer or divi- dend department to subscribe to the stock. Before the expiring date of the rights the transfer department delivers the rights to the corporation for the customer’s account and receives a receipt for the new stock. The customer’s account is debited with the cost of the subscription. In about a week the new stock is ready, and the transfer department of the brokerage house delivers the receipt to the transfer agent and receives the new stock which is then credited to the customer’s account. 240 WALL STRBE T Special Accounts There are two special accounts in the transfer department. These are, the Broker’s Transfer Account, and the Transfer Suspense Account. The Broker’s Transfer Account is used when another broker owes the firm a certain number of shares and does not have a certificate for the correct number of shares to deliver. For instance, Goodman & Co. are to deliver 20 shares of stock to Whitney & Company. Goodman & Co. do not happen to have a certificate for 20 shares but have one for 20 shares. Goodman & Co. delivers the 30 share certificate to Whitney & Co. who, as it happens, do not have ten shares in the box to deliver back. In such a case the Blotter clerk receives 20 shares on the blotter and swings 10 shares to Broker’s Transfer Account. The 30 shares are passed on to the transfer department together with instructions that 20 shares be transferred to the name of Whitney & Co. and 10 shares to the name of Goodman & Co. who “over-delivered”. When the transfer department receives this stock back from transfer they make an entry on the deliver blotter, delivering the number of shares over delivered to the broker who over-delivered them. The shares are then sent to this broker with a receipt attached, which lie must sign and return. This receipt is filed and kept as a permanent record so as to eliminate any doubt as to whether the shares were re- ceived by the broker to whom they were sent. The Transfer Suspense Account is used when a firm will receive stock from another firm (in the name of the firm re- ceiving the stock) in error. This is received and entered in the Transfer Suspense Account. The next day the transfer depart- ment informs the broker who sent the stock of his error, and requests him to send a. letter claiming the stock sent by mistake. This letter is desired as a permanent record for the transfer department’s files. Upon receipt of the letter the shares are transferred and delivered to the broker who made the error. Transfer Record Sheet The record sheet kept in the transfer department is shown on the following page. 24 t WALL STREET W H W 02 « W fcl 02 Eh iS •S « +» 23 a ce 'TS <1 rt rC o I “S l" co co 05 (M 05 r*H 05 CO a o 3 r d a rC o uo oo 05 <50 05 m ui P o o co *— H 05 242 ri‘' 8 r g . 2^0 f-< « SH - © O Ph 02 05 CO o 05 U u e 3 a tr- ee CM C— CD a d o

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1) H3 ro 00 Eh ^ £ P p 9 ce 2 >* fl ce bX) CHAPTER X Unlisted Trading Department UNLISTED TRADING Trading in unlisted or over-the-counter securities constitutes a large and very important part of the regular activities of Wall Street. Thousands of Corporations engaged in business throughout the different sections of the United States find a market for their securities through the many investment firms which make markets in these unlisted bonds and stocks. The field is large and no one organization can cover the entire ground. We therefore find one firm specializing in public utilities, another in bank stocks, another in investment trusts, etc., although a number of the larger firms maintain different departments to cover several classes of securities. Trading in unlisted securities is not confined to organizations who are not members of an Exchange. Many large New York Stock Exchange houses have their unlisted trading depart- ments where a large and profitable business is transacted. Nor is the trading limited to Corporation issues, as the majority of government, state and municipal bonds are handled over- the-counter. An idea of the magnitude and variety of this trading may be gained from the quotations published in a New York evening paper. This paper is not classed as a financial organ in any sense of the word, nor does it make a specialty of quoting unlisted securities. However this paper in one day quoted bid and asked prices on, 75 public utility bonds, 118 investment trusts, 17 mortgage companies, 29 New York City bonds, 13, New York state bonds, 28 telephone and telegraph stocks, 166 industrial stocks, 189 bank stocks, 42 trust com- pany stocks, 47 — $100 bonds, and 40 aeronautical stocks. These issues may be classed as more or less local to New York and as being fairly active. They represent only a small fraction of the unlisted securities traded in throughout the country. Because a security is not listed, is no reflection on its merit or intrinsic value. Suffice to say that good securities and very speculative securities are found alike in listed markets and unlisted markets. However investors will buy unlisted secur- ities and the unlisted traders perform a very important eco- 245 WALL STREET nomic function in establishing and maintaining markets for these securities. It is very difficult indeed to float a new issue where there is no prospect of a market being established but of course this has been done in numerous cases, particularly where the issues are small, and the company is more or less of a closed Corporation. However an investor is sure to look for market- ability in purchasing any kind of security. It is worth mentioning that the old Standard Oil Co. of New Jersey was quoted in the unlisted market prior to its dissolu- tion by the decree of the U. S. Supreme Court. After the dis- solution the stocks of the 33 subsidiary companies were traded in very actively, principally in the over-the-counter market. Gradually most of these stocks were listed on the New York Curb and a few were later transferred to the New York Stock Exchange notably Standard Oil Co. of New Jersey, Standard Oil of California and Standard Oil Co. of New York. During the period of the over-the-counter trading the transactions were enormous in volume and the fluctuations in price ex- tremely wide which showed the ability of the unlisted traders to cope with many difficult situations. The unlisted trader, of course, must have a basis for quoting markets. The method of obtaining original orders and current quotations can be best shown by the following example : Mr. Crane, the unlisted trader for a large firm decides to specialize in the stock of the Fifth National Bank (fictitious). He will first obtain a list of the stockholders of the bank and con- tinually circularize them, giving the latest quotation and advising them that his firm is trading in the stock and would appreciate receiving their orders to buy or sell. He must also keep the stockholders advised of any interesting news concern- ing the bank and give their inquiries prompt attention. Con- tinually activity of this sort is bound to bring results, assum- ing of course that the firm has a good reputation and is fav- orably known in the over-the-counter markets. Let us say that the last sale of the stock was 148 and Mr. Crane received orders to buy 50 shares at 147 and to sell 100 shares at 149. Thus an actual market is created of 147 bid 149 asked. How- ever Crane must make a fair profit and would accordingly quote the market about 1461/^ bid 149V2 asked, provided no other better bids or offers were in the market. If a competitor were quoting the market 147^ bid 148V2 asked, nothing could be done at the moment on these orders and Mr. Crane would 246 WALL STREET so advise his customers. Furthermore the business being very competitive it would be necessary for Crane to make his quo- tation 147% bid 148% asked, and if he purchased some stock on this market at 147%, he must decide whether he will hold it or sell it to his competitor at no profit. It is very likely however that he could sell it at a small profit say % or % point to a party quoting 147% bid. If a stock is quoted wider, that is, with a greater difference between the bid and asked price, such as 140 bid 160 asked there is considerably more opportunity to trade at a large profit. We will however assume that Crane’s market is the best, that is, 146% bid 149% asked. If he bought stock at 146% he would sell it to his client at 147 and if he sold stock at 149% he would buy it from his client at 149, thus making a profit of % point. There are many intricacies in trading in unlisted stocks which of course could not be covered here, but the above il- lustration will show the basis for establishing quotations, and the manner in which markets are made. A few of the requisites of the successful trader are : 1. Experience. 2. A telephone acquaintance with other traders so that they may be addressed in a somewhat informal manner. Many men have been trading with each other for long periods and have reached the stage of easy familiarity without ever having had personal contact, and with their business relations on this basis a spirit of co-operation and helpfulness is maintained. 3. The ability to judge and correctly interpret the market position of the stocks in which he is trading and to quote his market accordingly. 4. To fully understand the technique of trading and to be able to distinguish firm markets from nominal quotations. 5. To be able to make firm markets. This is dependant upon his receiving actual orders as previously explained. 6. To be capable and shrewd, but not tricky. The tricky trader may make a few profitable trades but in the long run he will find it difficult to receive the co-operation of his fellow traders and will eventually fall into a trap of his own making. 247 WALL STREET 7. Absolute honesty to stand by any transaction he has made. This business is conducted entirely by word of mouth and there is no actual proof of a purchase or sale. Each trans- action however is properly confirmed by comparison between each party to the trade but the comparison is not made until the close of business of the day on which the trade was made or the following morning. 8. The ability to make money without taking a position, which in effect is successful trading. It is however necessary at times for a trader to be long or short but this should be the exception rather than the rule. Top heavy positions have caused many losses and have often resulted in the failure of trading firms. The unlisted trader must be continually on the alert so that he will not misquote stocks and buy or sell at prices which would show a loss. As there are no public quotations the trader must check his market several times during the day, this being done by calling up other traders in order that he may keep in close touch with what is going on. For instance a trader may be quoting a stock 180 bid 185 asked, without having an actual order and basing the quotation on that of a competitor. Supposing that in the meantime a large block of the stock came in the market and sales were made at 180-178 and 175, the latest quotation being 170 bid 175 asked. Not knowing of this latest development the trader buys stock at 180 but in attempting to sell it finds to his sorrow that 170 is the best bid. Therefore continual checking is most important. In addition to circularizing stockholders the unlisted trader must advertise freely in the financial newspapers, and must continually keep his name before the entire trading fraternity so that he become firmly established as a specialist in his par- ticular line of securities. This results in his receiving orders from other firms and keeps him in close touch with every market development. Terms Firm Market — A bid and an offer at which prices a stock may be actually bought or sold. If a trader quotes a stock 88 bid 90 asked and states that it is a firm market he is bound to buy at 88 or sell at 90, if the other party will trade im- 248 WALL STREET mediately at these figures. However should the other party make a counter offer, the trader making the market is allowed to withdraw his original market of 88 bid 90 asked, and can quote a new market according to his judgment. Nominal Market— A bid and offer which is considered merely as a quotation and not as the basis for actual trading. A trader asked to quote a market will say “about 88 bid and 90 asked” or “88 bid 90 asked, nominal” if he does not wish to trade at these figures. Counter Bid or Offer — Improving a trader’s bid or offer in trying to bring about a trade. For instance, a trader quotes a firm market 88 bid 90 asked and his customer says, “I will pay 89 for 50 shares.” This is a counter bid and allows the trader to withdraw his original market if he so desires. How- ever, the trader might be able to sell at 89 and if so, would probably close the trade at this price. 24H CHAPTER XI Statistical Department THE STATISTICAL DEPARTMENT The statistical department of a brokerage or investment house renders a number of different services. It furnishes information and advice to the customers or prospective cus- tomers of the firm and handles by correspondence inquiries of all kinds for investment information. It also serves the other departments of the house by keeping them posted on devel- opments affecting the securities in which they are interested, and on conditions and developments in individual industries and in business generally. The statistical department does more than the name implies however, for in addition to its work of an investment advisory character it also functions as a new business department. In this work it engages in the prepara- tion of market letters, circulars and prospectuses, which are sent to clients and a selected list of others to whom it believes the information will be of interest. In addition to this some banking houses do special investi- gation, appraisal and research work, and while much of the work of this character is usually done by outside firms of engineers and accountants who are engaged especially for this purpose, some of it may be done by members of their own statistical department where they are qualified along these lines. In connection with its investment advisory activities the statistical department also maintains the files and records of investment data used by the firm in this work. Some of the data used in this connection is obtained through its own sources of information but most of it is obtained primarily through the services rendered by the various statistical and in- vestment information organizations which specialize in gather- ing, summarizing, analyzing and interpreting the great mass of data which it is necessary to assemble in order that adequate information may be available concerning the investment status of the securities in which the public is likely to be interested. Through the services of these outside statistical organizations the well equipped statistical department today is usually in a position to supply accurate and up-to-date information on all classes of securities, including bonds, preferred and common stocks of all kinds, covering both American and foreign se- 253 WALL STREET eurities, and embracing Government, State, County, Municipal, industrial, public utility, financial, mining securities, etc. This information includes current and comparative data for a number of years on earnings and earnings records, capital- ization, financial position, dividend record, comparative bal- ance sheets and income statements extending back over a period of from two to ten years, production and operating statistics, territory and markets served, officers and directors of the company and much other information of value to the investor in appraising the value of a security. In addition, the statistical department is in a position to furnish information on the general business outlook and the position of individual industries ; which industries are the most or least prosperous ; which are improving and which are receding. Accordingly, investors and traders who are desirous of taking advantage of the fund of information and data which the well organized investment house usually has available on investments and the subjects related thereto, should take the trouble to inform themselves as to the work of such depart- ments and how this information may be used by them to the best advantage in connection with their investment plans and speculative activities. The extent and quality of the information and of the serv- ices rendered by the statistical department varies, according to the size of the house, the character of the business handled, and also according to the ability of the staff of this department and of the statistician in charge, in analyzing and interpreting the statistical information which is continuously flowing into such departments on securities of all kinds and on the devel- opments affecting them. The facilities of the statistical de- partment for obtaining up-to-the-minute and accurate informa- tion plays an important part in the quality of the service ren- dered. In recent years, through the growing use and more frequent and regular publication of statistical data relating to finance, trade, industry and the affairs of individual corporations, a constantly increasing fund of knowledge on all matters per- taining to securities and investment problems has become available to the statistical departments of brokerage and in- vestment houses. Moreover, through the services of such or- ganizations as the Standard Statistics Company, Moody’s In- vestors Service, Poor’s, the Brookmire Economic Service, Bab- 254 WALL STREET son’s Statistical Organization, and the other investment and statistical organizations engaged in this work, a vast amount of information concerning practically all the securities of the United States and a large number of those of foreign coun- tries, is summarized and presented in such form that the in- vestor of today is in a much better position to place his in- vestment and speculative activities on a more safe and profit- able basis than heretofore. Most well equipped investment houses use the services of the Standard Statistics Company, Moody’s or Poor’s, and a large number are equipped with all three. The Standard Sta- tistics Company provides as many as thirty different services which cover practically every field of investment and business information as it relates to the problems of the individual in- vestor and speculator, to the work of the banking or brok- erage house and to the problems with which these houses are confronted in the handling of their businesses from the stand- point of their own needs, as well as those which they attempt to meet in serving the needs of their customers. Some houses specialize in certain types of securities, and in the securities of certain industries, and where this is the case, the statistical departments of such houses usually have in- formation which is likely to be more comprehensive and up- to-date, than is ordinarily readily available to the investor, as well as contacts which place them in more intimate touch with the conditions in these industries and with the affairs of the corporations in whose securities they specialize. This informa- tion is usually made available to the clients and prospective clients of the house and accordingly enables them to obtain much detailed information concerning the affairs of these particular corporations and the conditions and outlook of the industry in which they are engaged. To give some idea of the ground covered in the records maintained by the statistical department we will discuss briefly in the following pages the character of the information avail- able from all sources on the different classes of securities, and on the corporations and the industries of which these corpora- tions form a part. In this connection we will also enumerate and briefly outline the different classes of investment and busi- ness information as made available through the services fur- nished by the statistical organizations which specialize in fur- nishing this information. 255 WALL STREET BOND INFORMATION AND SERVICE The information available on bonds usually contains all the essential facts concerning which the investor is likely to be interested or on which he should be informed. In Standard’s Bond Investment Service, bonds are grouped according to : — 1— Industry and Rating. 2 — Coupon, Rating and Maturity. 3 — Yield. This service is designed to aid in the selection of bonds and through it any active corporation or foreign government bond may be compared with all other similar bonds on the market. It covers every corporation and foreign government bond with an active market in this country — about 3,500 in all, and gives the following essential facts on each bond’s investment posi- tion: (1) The amount outstanding, (2) amount of all prior liens, (3) ratio of tangible net assets, (4) ratio of current net assets, (5) interest charges times earned during current year, (6) interest charges times earned over period of years, (7) rating of the bond, (8) bid and asked price, (9) yield to ma- turity, (10) interest dates, (11) exact maturity date, (12) original offering price, (13) year originally offered, (14) in- dustrial group in which bond appears in the Industries Sec- tion (Item No. 1 above), (15) Callable prices, (16) whether legal in New York, Massachusetts, or Connecticut. Weekly bulletins keep this information up-to-date, and call attention to sudden bond price changes. The service also in- cludes monthly lists of bonds which apparently are selling too high; short term securities, bonds selling close to or above callable prices ; attractive investment bonds ; convertible bonds. In brief this service is designed to give quickly: (1) The vital facts every investor should have about a bond he is con- sidering, (2) The names of bonds that offer higher yield for similar safety — if there are any, (3) The names of bonds that offer greater safety for similar yield — if there are any. In the bond service designated Standard Bond Descriptions are described more than 3,500 of the more important railroad, 256 WALL STREET public utility, industrial and foreign government bond issues, and about 3,000 additional bonds in which the public interest is not so great. This information is kept up-to-date by con- stant revision and is supplemented by bond bulletins which are issued weekly, and which are designed to give the latest bond news, descriptions of the most recent bond issues, and to show everything that has happened to affect the value of a bond since the last full description of the bond was published. In Standard’s Sinking Fund Sheets is available a com- plete record of bonds called for payment, not only for sink- ing fund purposes, but, also for redemption in their entirety. Information of this kind is of value to the bond sales’ and cashiers’ departments, as it gives a semi-weekly cumulative record of bonds called for redemption and of sinking fund proposals. Prospective sinking fund operations are tabulated here, and the approximate amount of bonds to be called for redemption or purchased for sinking fund account is indicated from 1 to 3 months in advance. Recent defaults, income bond interest payments, and temporary certificates exchangeable for permanent bonds are also on record here. Under Standard’s Bond Offerings Service is indicated the offers and wants of over 2,500 representative bond houses. It also shows interest dates, on which exchange a bond is listed, name of trustee, character of sinking fund clause, names and addresses of firm making original offering, price at which it originally sold, price range, whether interest has been de- faulted, whether issue has been called, etc. In Standard’s service on the Status of Bonds is available information on the status of over 15,000 bonds under the Federal Income Tax. This answers the following questions on each bond: Is the tax paid at source? Will an additional tax be refunded direct to bond holder? If tax is not paid at source, will it be refunded direct to bondholders, and if so, how much will be refunded? What state taxes, if any, are refunded? Is the bond issued by an individual or partnership? In other words the answer to practically every tax question that is likely to arise relating to bond interest payments is available here. This information is quite helpful to the cashier’s department of a bond house, and to the teller of a bank. 257 WALL STREET RATING OF SECURITIES In the attempt to appraise the value of securities on a sci- entific basis systems of rating stocks and bonds have been developed by a number of the investment statistical organ- izations. These ratings represent investment yard sticks and are of great practical value to the investor who is not in a position to analyze and determine the value of securities for himself. The fundamental thought back of such systems of rating securities is to furnish a key to the relative security and stability, from an investment standpoint, of all types of bonds and stocks. In these systems the ratings of all bond issues, of every class, are based on formulae developed as a result of years of exhaustive research and study. The primary factors used in the development of such formulae, in the ease of bonds, are asset value or mortgage position, earning power, stability, and marketability. It does not follow, of course, that these ratings are infallible, or that ratings may not change from time to time. Changing conditions will cause changes in the quality of securities, and a bond which under present conditions may be entitled to only a B rating may conceivably become an A bond next year or thereafter, while conversely, a bond with a present rating of A may so depreciate in value as to warrant only a B rating at some later date. Generally speaking, however, in the case of bond ratings, the changes are relatively slight, and it is only on rare occasions that bonds (outside of the semi-speculative classes) fluctuate in investment quality more than a point or two. To more clearly illustrate the use of, and the methods em- ployed in rating bonds it may be noted here that in order that bonds may be compared properly they must be grouped ac- cording to security. This is what the rating accomplishes. This, however, does not mean that all bonds with an A1 rating have identically the same degree of safety. Some bonds in this particular grouping will necessarily be a little better than the best bonds with an A rating, while some will be very nearly entitled to an A1+ rating. 258 WALL STREET If bonds were articles that had length and could be meas- ured, this investment “yard stick”, or rating measure would look something like this: r ■ - ■ | A1 + Al A | B1 + 1 » » i » i t t i * i L J— L- » S t 1 -1 1 1 The bond X would be higher on the scale than the bond Y, although both would have the rating Al. Yet this stick would bring together for comparison bonds of about the same “length”. The finer differences between bonds must be deter- mined by the comparison which the groupings by ratings make possible. In the rating system employed by one organization bonds are first rated on a percentage basis. A definite percentage is allowed for each element of strength under each of the three main heads — Earnings, Mortgage position, and Marketability. The maximum allowances are 50% for earnings, 35% for mortgage position, 15% for marketability. Exactly the same percentage is always allowed for the same element in every bond in the same class — railroad, industrial, or public utility. The final percentages are then translated into symbols A1+, Al, A, Bl-f-, Bl, B, etc. An Al-f- bond is one that has received the maximum percentage allowances referred to above. The other ratings signify varying percentage deductions from this maximum. By such methods of rating similar bonds are brought squarely in contrast with each other and the chance of error due to inevitable human prejudice is greatly reduced or removed. In the rating of stocks the same general principles are fol- lowed. Ratings on stock issues, however, are based on formulae distinctly independent of those applied to bonds, and as in the case of bonds, the attempt is also made to evaluate and rate stocks on a scientific basis. 259 WALL STREET CORPORATION RECORDS In the recoi’ds maintained on corporations, information is available on every important corporation of the country. This information is complete from the date of organization down to the present date, and includes detailed data on the capitali- sation of the company, amounts of bonds, preferred and com- mon stocks outstanding, the terms and provisions pertaining to these issues, general financial position of the company, working capital position and current ratio, dividend record, book value of the stock, current and average earnings over a period of years, detailed balance sheets and income statements presented in comparative form for a period of years, high and low prices of the stock, for each year, production and oper- ating statistics, history of the company, nature of business, extent and location of plants and properties, territories and markets served and the officers and directors of the company. In addition to the above mentioned corporation data, in- formation is currently received by the statistical department daily and weekly, summarizing all the corporation news pub- lished throughout the country, providing complete and up-to- the-minute information on the financial condition of the vari- ous companies, their latest earnings and operations, building plans and acquisitions, new financing and issue of securities, business troubles, and reorganizations, elections of officers, etc. In the following pages is presented an example of the rec- ords maintained, in card form, for corporation data, showing the scope of the information covered in these records. The in- formation shown in these cards is also available in bound man- ual form. The manuals are republished annually or more fre- quently, and are kept up-to-date by supplements published weekly or monthly. 260 WALL STREET LIMA LOCOMOTIVE WORKS, INCORPORATED L 19 Revised February 8, 1929. ANNUAL REPORT SECTION. Individual Reports Section STANDARD CORPORATION RECORDS Vol. 7 — No. 801 February 27, 1929. Sec. 9 Copyright, 1929, by Standard Statistics Co., Inc., Publishers. 200 Varick St., N. T. Position and Prospect (Based on Annual Report for fiscal year ended Dec. 31, 1928, and later information to date of revision. Any changes based on subsequent data or developments will be published in Bulletin Section (White) L 20, in bold face type under “Digest of Position and Prospect.’’) Lima Locomotive Works, Inc., is the third largest builder of steam motive power in the United States. This com- pany and its predecessor have been engaged in the manufacture of passen- ger and freight locomotives and parts for more than half a century. The standard types of Lima locomotives are in use on many leading railroads in- cluding such lines as New York Cen- tral, Pennsylvania, Southern and other important systems. In addition to its standard freight and passenger equip- ment, the company manufactures the Shay geared locomotive for heavy duty industrial service. Enlarged Plant Important betterments and enlarge- ments were made in the company’s plant in 1922 and 1923 in preparation for the revival of railroad buying which was expected to come with the recovery in carrier earning power. Plant capacity was increased more than one-third. Present facilities would permit annual production of about 600 freight and passenger locomotives for railroad service and about 150 smaller industrial engines. Late Developments Locomotive manufacture in the last few years has entered upon a phase of intensive engineering development such that equipment of a more efficient order is displacing the older designs and types in fast passenger and heavy freight service. A factor affecting both the volume of sales and types ordered is the larger proportion of replacement (S-B) (Continued on orders today as compared with past periods. The number of units of motive power for the country at large has de- creased somewhat in recent years, though total tractive power is greater. Increased efficiency and size combined with more nearly continuous utiliza- tion of units has tended to restrict the volume of new orders, but meantime the margin of reserve locomotive ca- pacity in excess of immediate operat- ing requirements appears to have been narrowed to the point where any fur- ther growth of traffic would necessi- tate the installation of additional units. Acquires Power Shovel Company With a view to diversifying its prod- uct, the company acquired during 1928 the Ohio Power Shovel Company, which manufactures power shovels, cranes, draglines, and similar products, now marketed under the trade name “Lima 101.’’ In locomotive business there was no improvement during the year 1928 over 1927, and the amount of business done represented only about 25% of capacity. Unfilled orders on the books at the beginning of 1929 amounted to about $2,485,000. Capital and Dividends The company has no bonded debt and but one class of capital stock. There is outstanding 211,057 shares of no par stock of a declared value of $10,552,850. The former $1,943,300 of preferred stock was called for re- demption in 1922 and the entire issue was converted into common. Regular dividends were paid on the following page) This information, while not guaranteed, is believed to be correct. 261 LIMA LOCOMOTIVE WORKS, INCORPORATED.— Annual Report. L 6.41 WALL STREET L 19 — 2 LIMA LOCOMOTIVE WORKS, INC. — (Continued) preferred to retirement. The common received payments from the last quar- ter of 1921, beginning with a rate of $7 a year on shares of $100 par. One year later the stock was changed to no par value and the rate of $4 estab- lished on new stock issued in the ratio of two new shares for one old. The $4 per annum distribution was main- tained through the first half of 1928, but omitted thereafter. Earnings Variable Sales were relatively high during the rehabilitation period of the rail- ways in 1920 and 1921, and following the depression period in 1922, a record for the decade of $20,287,000 was reported in 1923. During the last five years, however, sales have averaged only about half as much ; and were $6,219,000 and $6,559,000 respectively in 1927 and 1928, following a recov- ery to $17,899,000 in 1926. Net in- come declined from $2,402,600 in 1923 to $1,500,000 in 1924, and a loss of $844,400 was reported for 1925. The recovery in 1926 brought a net in- come of $1,704,800, but losses of $191,300 and $111,600 were sustained in 1927 and 1928 respectively. Large Working Capital Current assets Dec. 31, 1928, totaled $7,105,500, including $4,568,600 cash and TJ. S. Government obligations and $739,400 receivables. Current liabil- ities were $223,700, leaving indicated net working capital of $6,881,800, some $190,000 less than in the pre- vious year and $800,000 less than at the close of 1926. Gross book value for property had been increased little during the year, and the net amount after depreciation had declined some $360,000 in reflection of the year’s depreciation charge. Goodwill was still valued at $2,687,716, and drawings, patents, dies and similar items at the nominal figure of $1. Book value of the stock, excluding intangibles, was $50.68 per share. Outlook Improvement in the railway equip- ment industry was shown in January, 1929, year-end orders being heavy. Record appropriations for equipment in 1929 are reported in the railroad budgets, and in spite of the smaller amount of unfilled orders reported at the close of 1928, the company’s busi- ness in the current year is expected to show an increase. Surplus equip- ment in the fall of 1928 was reported as considerably less than in the cor- responding period of 1927. STANDARD STATISTICS CO., Inc. ANNUAL REPORT New York Office — 17 East 42nd St., New York City. Corporate Office — Richmond, Va. General Office — Lima, Ohio. Transfer Office — Irving Trust Co., New York City. Registrar of Stock — Guaranty Trust Co., New York City. Annual Meeting — First Wednesday in April, at Richmond, Va. New York Stock Exchange Listed Security. Certification of Accounts. — Company's Reports certified by Lingley, Baird & Dixon, Accountants and Auditors, New York. Capitalization. Note. — As of date of revision the company had no funded debt. Current amounts of authorized and outstanding capital stock are published in Bulletin Section (White) — L 20. Changes in Authorized Capital Stock. At the time of organization, the au- thorized capital stock consisted of $3,- 200,000 (par, $100) preferred stock and $7,550,000 (par, $100) common stock. By conversion into common stock, the preferred stock was reduced to $1,943,- 300 on Dec. 31, 1922. On July 14, 1922, the stockholders voted to change the $100 par value shares of common stock into shares without par value, and to increase the authorized common shares to 300,000 (no par value). Such changes became effective July 15, 1922. (Continued on following page) 262 WALL STREET LIMA LOCOMOTIVE WORKS, INC.— (Continued) L 19 — 3 Purposes of Stock Issuance. Common Stock (Par, $100) — $2,000,000 issued in exchange for $2,000,000 pfd. stock of Lima Locomotive Corp. 1,000,000 issued in exchange for $4,000,000 com. stock of Lima Locomotive Corp 1,100,000 issued to purchasers of $2,000,000 pfd. stock of Lima Locomotive Works, Inc. 250,000 issued to officers and employees of Lima Locomotive Works, Inc. (addi- tional compensation). 656,800 issued in conversion of $656,800 preferred stock of Lima Locomotive Works, Inc. $5,006,800 total common stock (par, $100) issued prior to July 14, 1922. As of Dec. 31, 1922, all the common shares (par, $100), except 249 shares, had been converted into no-par shares. Common Stock (No par Value) — Shares 100,136 issued in exchange for 50,068 shares (par, $100) at the rate of 2 fori. 66,757 sold for $3,337,850 in cash. 44,164 issued in conversion of shares of preferred on a basis of 2 shares com- mon for 1 share of preferred. Preferred Stock (Par, $100) — $2,200,000 issued for cash at $90 per share to depositors of $4,000,000 com. stock of Lima Locomotive Corp. (cash received from sale of pfd. stock turned into treasury for working capital). 665,000 issued for cash at $90 per share on Sept. 27, 1917, to stockholders of Lima Locomotive Works, Inc. (turned into treasury to be used as work ing capital). $2,865,000 total preferred stock issued. Less : $921,700 converted into common stock. $1,943,300 preferred stock outstanding Dec. 31, 1922. On June 1, 1923, the outstanding preferred stock was called for redemption at $107.50 per share and accrued dividends. All preferred stockholders, however, availed themselves of the conversion privilege into common stock, so that no stock remained for redemption. Number of Stockholders, As of November 15. *1928 1927 1926 ‘August 15, 1928. 1,480 1,231 1,240 1925. 1924 1923 1,223 1,341 1,273 High and Low Prices of Stocks. (New York Stock Exchange — Preferred and N. Y. Stock Exchange on Mar. 23, 1921.) 1928 1927 1926 1925. 1924. 1923. 1922 1921. Common Stocks were Listed on the Pfd. Com. High Low High Low a a 65% 38 a a 76% 49 a a 69% 53% a a 74% 60 a a 71 56 al33*4 all3 74% 58% 126 98 f *65% 52 l tll7% 91 102 87 % tl02 64 •New common (no par value). tOld common (par value, $100). aPreferred stock was converted into common stock prior to .Tune 1, 1923. (Continued on following page) 263 WALL STKEET L 19 — 4_ 1920. LIMA LOCOMOTIVE WORKS, INC.— (Continued) — Common — High Low _ 92 58 (New York Curb.) — Common — High Low 1919 98 27% 1918. - — Common — High Low - 50% S3 Approximate Dividend Dates. Dividend Meetings Last Wednesday in Jan. April July Oct. Ex-Dividend Feb. 15 May 15 Aug. 15 Nov. 15 Dividends Payable Mar. 1 June 1 Sept. 1 Dec. 1 Dividends Paid in Calendar Years Since Organization — Com. Com. (Par, (No Par) Com. Pfd. $100) (PerShr.) Pfd. (Par, $100) % % % % 1928 _ (a) $2 1919 _ 7 1924-27 (eachyr.) (a) $4 1918 _ 7 1924-26- (a) $4 1917 t3% 1923 (a) 3 % $4 1922 _ __ *l-fa 5% $1 1921_ _ 7 tl% 1920— 7 — ‘Owing to change in dividend payment dates, the company paid 7A% in 1922, as follows: Feb. 1, 1%%; May 1, 1%%; Sept. 1, 2%%; Dec. 1, 1%%. tlnilial common dividend, 1%%, paid Dec. 1, 1921. jlnitial preferred dividend, 3%%, paid Nov., 1917. (a) Preferred stock was converted into common stock prior to June 1, 1923. Dividends paid during current calendar year will be reported in Dividend Sections. 10%-Year Analysis of Income Account. (In 1928, Lima Locomotive Works, Inc., and Ohio Power Shovel Co., In 1927 and prior years, Lima Locomotive Works only.) (Years Ended Dec. SI.) (Based on “Comparative Income Account’’ — See Table Following) (a) Res. for Ratio of Depr. Fed. Balance Oper. Oper. Exps. Tax and Avail, for Bond Times Sales Income to Sales Contings. Bond Int. Interest Earned $ $ % $ $ $ 1928 6,558,958 2,636 99.96 414,762 g 1927 6,218,760 d63,463 101.02 415,244 g 1926 17,899,073 2,520,611 85.92 891,217 g 1925 4,490,028 d830,845 114.05 419,220 g 1924 14,577,135 1,508,736 a89.65 225,000 g 1923 20,286,868 2,791,836 a86.23 500,000 g 1922 6,476,953 255,740 a96.05 255,740 80,294 3.is 1921 12,528,154 2,112,006 83.14 855.414 1,256,592 120,000 10.47 1920 12,047,657 1,817,597 84.91 618,866 1,198,731 120,000 9.99 Res. for Deprec. Federal Net and Taxes Earnings Obsolescence Paid $ $ $ *1919 896,613 277,353 119,486 (Continued on following page) 264 WALL STREET LIMA LOCOMOTIVE WORKS, INC.— (Continued) L 19—6 Pfd. Divs . , Common ^ , Preferred > and Dividends Dividends 4 Bond Int. Divs. (b) Earned (b) Paid Net Paid Divs. Times Paid (Per (Per Surplus Income (Amount) Earned Paid Earned (Amt.) Share) Share) for Year $ $ % % $ $ $ $ 1928. . . . dill, 606 f f r f 422,114 dO. 53 2 d533,720 1927. . . . dl91,341 f f f f 844,228 d0.91 4 dl, 035, 569 1926 1,704,828 f f f f 844,228 8.08 4 860,600 1925 d844,392 f f f f 844,228 d4.00 4 dl, 688, 620 1924 1,500,043 f f f f 844,228 7.11 4 655,815 1923 2,402,605 30,326 f 3% f 809,570 11.38 4 1,562,709 1922. . . . 175,446 130,985 10.16 7rV 1.21 189,211 0.26 (c)6% dl44,750 1921. . . . 1,136,592 200,550 39.67 7 3.92 304,500 21.52 7 631,542 1920.... 1,078,731 200,550 37.65 7 3.74 20.19 878,181 *1919.... 499,774 200,550 17.44 7 (g) 6.88 299,224 •Fourteen months ended December 31, 1919. (a) Depreciation only, In 1928, 1927 and 1925. Federal taxes and contingencies only, in 1924 and 1923. Depreciation and Federal taxes only, in 1921 and 1920. In 1924, 1923 and 1922, depreciation was included in operateg expenses. (b) The earnings per share on common in 1922 and subsequent years and the dividends paid per share on common in 1923 and subsequent years are based on no-par shares. The dividends paid per share on common in 1922 are partly on no-par and partly on $100 shares. The earnings per share and dividends paid per share on common; in 1921 and previous years are on $100 par shares. cOf the $6.25 per share common dividends paid in 1922, $5.25 per share was paid on shares of $100 par value and $1 per share on no-par shares. dDeficit. fPreferred stock was converted into common prior to June 1, 1923. gBonds were outstanding only in 1920, 1921 and 1922. Comparative Income Account, Years Ended Dec. 31. (In 1928, Lima Locomotive Works, Inc. and Ohio Power Shovel Co., in 1927 and prior years, Lima Locomotive Works only.) 1928 1927 1926 ' 1925 1924 1923 1922 $ $ $ $ $ $ $ Sales 6,558,958 6,218,760 17,899,073 4,490,028 14,577,135 20,286,868 (a) 6,476,953 Mfg. cost (Incl. depr. in 1922 to 1924, in- elusive), adm. and other exps 6,556,322 6,282,223 15,378,462 5,120,873 13,068,399 17,495,032 6,221,213 Oper. income 2,636 d63,463 2,520,611 d630,845 1,508,736 2,791,836 255,740 Other income. 300,520 287.366 165,431 205,675 216,307 110,769 Gross income 303,156 223,903 2,686,045 d425.170 1,725,043 2,902,605 255,740 Deductions — Res. for deprec 414,762 415,244 409,967 419,222 (b) (b) (b) Int. on bonds 80,294 Res. for confine 350,000 r Res. for Fed. taxes 221,250 225,000 l 500,000 \ Total deduct. 414,762 415.244 981.217 419,222 225,000 500,000 80,294 Net income. dill, 606 dl91,341 1,704,828 d844,392 1,500,043 2,402,605 175,446 Pfd. divs 30 320 130,035 Com. divs 422,114 844,228 844,228 844,228 844,228 809,570 189,211 Surp. for year d533.720 dl. 035. 569 860.600 dl. 688, 620 655.815 1,562.709 (d) 144.750 Previous surp. 2,914.722 3,843,672 2,983,072 4,671,692 4,015.877 2,453,167 2,470,994 Total surplus 2,381,052 2,808.103 3,843,672 2,983,072 4,671,692 4,015,876 2,326,244 (Continued on following page) 265 WALL STREET L 19—6 LIBIA LOCOMOTIVE WORKS, INC.— (Continued) Unexpend, res. (This table continued from preceding page) trans. to surp. (credits) 106,669 250,000 Prem. on Lima Loco. Corp. bonds retired (debit) 123,076 Surplus as per balance sheet 2,381,052 2,914,772 3,843,672 2,983,072 4,671,692 4,015,876 1928 1927 1926 1925 1924 1923 $ $ $ $ $ $ Earned per Share: On pfd. stock (aver, amount on which divs. On outstanding were paid) * * * * * * __ com. stock . . Nil Nil 88.08 Nil $7.11 $11.38 "^Preferred stock was called for redemption on June 1. 1923. (a) Designated "Gross Income.” (b) Depreciation included with operating expenses. (c) Based on 171,693 shares (no par) outstanding Dec. 31, 1922, plus 498 shares (no par), the equivalent of the 249 shares (par, $100) outstanding Dec. 31, 1922 — no par shares exchangeable for $100 shares in the ratio of 2 of the former for 1 of the latter. (d) Deficit. 2,453,167 1922 $ (c)$0.26 Comparative General Balance Sheet — Working Capital. (As of Dec. 31.) (In 1928, Lima Locomotive Works, Inc. and Ohio Power Shovel Co., in 1927 and prior years, Lima Locomotive Works only.) 1928 Assets — $ Land, bldgs, & 1927 $ 6,337,595 2,227,349 1926 $ 6,230,158 1,817,121 1925 ■ $ 1924 $ 1923 $ 1922 $ Less. rec. for deprec 2,638,182 Property (net) 3,749,454 4,110,246 4,413,037 4,726,506 5,111,230 5,443,041 4,876,432 Goodwill 2,687,716 2,687,717 2,687,716 2,687,717 2,687,716 2,687,716 2,687,716 Drawings, pat- terns, dies. etc 1 1 1 1 1 1 1 Accident insur. fund (cash & gov. secur. ) (see contra). 165,516 159,922 161,910 138,538 139,539 138,412 94,465 Deferred chgs. 64,890 49,194 61,545 80,165 59,764 54,379 359,855 Current Assets — ■ Cash 74,375 66,515 50,452 190,488 335,729 1,434,018 1,615,630 U. S. Govt. obligs 4,494,196 5,713,193 5,133,225 3,610,184 4,534,488 Notes or bills receiv 120,187 182,842 27,019 76,552 150,623 146,250 Accts. receiv. incl. in 1928, bills rec $739,357 $131,495 $2,043,632 855,050 1,505,625 2,257,310 1.064,659 Employes’ pfd. stock subscrip. 37,164 Inventories .. 1,627,197 1,021,838 1,179,323 2,547,655 1,954,715 3.887,895 4,438,865 Investments . 170,380 170,379, 170,379 170,379 204,629 181,350 Total current assets .... 7,105,505 7,223,697 8,759,853 7,400,775 8,607,748 7,911,196 7,302,568 Total assets. 13,773,082 14,227,687 16,084,062 15,033,702 16,605,998 16,234,745 15,321,037 (Continued on following page) 266 WALL STREET LIMA LOCOMOTIVE WORKS, INC.— (Continued) L 19—7 (This table continued from preceding page) Liabilities — Pfd. stock 1,943,300 Com. stock (no par) 10,552,850 Com. stock 10,552,850 10,552,850 10,552,850 10,552,850 10,552,850 8,584,650 24,900 Accident insur. fund (see contra) .... 165,516 Reserve for 159,922 161,910 138,538 139,539 138,412 94,465 conting. . . . 450,000 450,000 450,000 t t t t Surplus 2,381,052 2,914,772 3,843,672 2,983,072 4,671,692 4,015,876 2,453,167 Current Liabilities — 1,000,000 1,070,832 Accts. payable 123,329 Miscel. accr. 40,793 659,662 1,024,262 688,896 885,199 liabs 100,335 tRe3. for Fed. 109,350 129,128 169,390 180,176 115,111 122,426 (a) 286,840 165,590 372,845 527,297 27,297 Total current liabils. . . . 223,664 150,143 1,075,630 1,359,242 1,241,917 1,527,607 2,220,555 Total liablls. 13,773,082 14,227,687 16,084,062 15,033,702 16,605,998 16,234,745 15,321,687 •Net working capital .... 6,881,841 7,073,464 7,684,223 6,041,533 7,365,831 6.383,589 5,082,013 •Based upon statement of current assets and current liabilities as above. tReserve for Federal taxes includes reserve for contingencies which Is not reported separately In years previous to 1926. JLess reserve. (a) During 1927, final settlement was effected with the Federal Government in respect of all income tax obligations to Dec. 31, 1926. Therefore no reserve for taxes appears on the above balance sheet. Equities for Stock, As of December 31. No. of shrs. of com. stock 1928 1927 1926 1925 1924 1923 1922 outstdg. . . . Par value of 211,057 211,057 211,057 211,057 211,057 211,057 •172,191 shares Indicated total book value (excl. trade- mks., good- will, pats., etc., but incl. in 1928,1927 and 1926, res. for contlngs.) applic. to None None None None Non** None None com. stk. ...10,696,185 Book value per shr. of com. 11,229,904 12,158.805 10,848.204 12,536,826 11,811,009 8,375.000 stock Goodwill, draw- ings, pats., $50,658 $53.21 $57.61 $51.40 $59.40 $56.29 $48 64 dies, etc. ...$2,687,717 Goodwill per share of com. $2,687,718 $2,687,717 $2,687,718 $2,687,717 $2,687,717 $2,687,717 stock $12.73 $12.73 $12.73 $12.73 $12.73 $12.73 $15.61 •249 shares (par, $100) and 171,693 (no par value), or the equivalent. 172.191 shares (no par) (Continued on following page) 2(57 WALL STREET L 19—8 LIMA LOCOMOTIVE WORKS, INC— (Continued) Earning Power. prior to Dec. 31, 1923- 1928 $2,485,157 1927 3,580,727 1926. $65,000 10% Years, Oct. 31, 1928 to Annual Dec. 31, 1928 Average - $7,350,680 $743,018 1 $34.83 $3.43 31 . j 1925 $6,900,232 History and Property. History. — Lima Locomotive Works, Incorporated, was incorporated un- der the laws of the Commonwealth of Virginia on April 25, 1916, with perpetual charter. The company acquired on Oct. 21, 1916, all the business and assets, and assumed the liabilities of Lima Locomotive Corp. (which had suc- ceeded the Lima Locomotive and Machine Co., established in 1872). During 1928, the company acquired the management and ownership of The Ohio Power Shovel Co. Nature of Business — The company is engaged in the manufacture and sale of locomotives and parts and accessories therefor. The Annual Re- port for 1928 stated that the company was manufacturing power shovels, cranes, draglines, etc., which are marketed through The Ohio Power Shovel Co., as a subsidiary, under the trade name “Lima 101.” Property— The company owns approximately 60 acres of land in Lima, O., upon which is located its manufacturing plant, which consists of buildings and equipment used for manufacturing locomotives and locomo- tive parts and for warehouses and offices of the company. The buildings and yards cover 34% acres, leaving 25% acres available for future ex- tension. Officers and Directors. OFFICERS — Joel S. Coffin, Chairman of the Board of Directors and President, New York; John E. Dixon, Vice-Pres. in charge of sales, New York; Wm. L. Reid, Vice-Pres. in charge of manufacturing, Lima, Ohio; Wm. E. Woodard, Vice-Pres. in charge of engineering. New York; Lewis A. Larsen, Vice-Pres. and Treas., Lima, Ohio; William H. Winterrowd, Vice-Pres., New York; J. Lee Laughlin, Comptroller, Lima, Ohio; Edward N. Pierce, Sec'y- and Asst. Treas., Lima, Ohio; Wm. E. Kleinoeder, Asst. Sec’y. Lima, Ohio. EXECUTIVE COMMITTEE — Samuel G. Allen (Chairman), Frederick B. Adams, Herman F. Ball, Joel S. Coffin, all of New York; Lewis A. Larsen, Lima, Ohio; Frank T. Heffelfinger, Minneapolis, Minn. DIRECTORS — Joel S. Coffin (‘Chairman), Frederick B. Adams (*W. A. Harriman & Co., Inc.), Frederic W. Allen (*Lee, Higginson & Co.), Samuel G. Allen (•International Combustion Engineering Corp.), Herman F. Ball (‘Franklin Railway Supply Co.), Franklin Q. Brown (‘Redmond & Co.), John F. Harris (‘Harris, Winthrop & Co.), all of New York; Frank T. Heffelfinger, Minne- apolis; Lewis A. Larsen (‘Vice-Pres. and Treas.), Lima, Ohio. ‘Also a director in other companies. Subsequent changes in Officers or Directors will be reported in “Bulletin” Section (White) — L 20. 268 WALL STREET RAILROAD INVESTMENT INFORMATION The information available to the investor on railroad se- curities and the operations of the railroads is not only com- prehensive but is available in such detailed comparative form that the investor interested in railroad securities is in a posi- tion to obtain at all times complete and accurate information and data on this group of securities. Voluminous and exactly comparable data are available about every important railroad once a month, and it is accordingly possible to analyze the stocks of railroad companies on a more scientific basis. Important sections of the information available on railroads are, as follows : Relative Stock Position: The information available in this section of the data on railroad securities is brought up to date monthly and embodies a statistical comparison of all impor- tant railroad stocks, divided into five main classes, as follows: (1) All important stocks; (2) Dividend paying common stocks; (3) Non-dividend paying common stocks; (4) Divi- end paying preferred stocks; and (5) Non-dividend paying preferred stocks. This comparison contains all of the essential statistical elements, including stock prices, current yields, in- dicated annual share earnings, last year’s actual per share earnings, 3-year average per share earnings, 10-year average per share earnings. Price-earnings ratios based on indicated share earnings, margin of safety for common and preferred dividend requirements and for fixed charges, deviation from average bond yields, etc. Earnings Actual and Per Share. In this section, which is brought up to date monthly, is found the actual gross revenues and net operating incomes of the individual railroad com- panies for the latest month reported and the cumulative period for the year to date. In addition, it contains estimates of the full year’s gross income including other income (sum avail- able for fixed charges) together with indicated fixed charges times earned, and per share earnings on both the preferred and common stocks, for the current year. Earnings Trend. In this section is available a comparison between estimated earnings cumulatively by months and 269 WALL STREET actual results for the preceding year, thus making it possible, at any time of the year, for the investor to compare a road’s indicated gross revenues for the year with preceding months and actual gross revenues of the preceding year, as well as such items as : indicated net after rents, estimates of property value, rate of return on these estimates of property value, any excess due the government, estimated other income, indicated gross income, indicated fixed charges times earned, and indi- cated earnings on preferred and common stocks, after making all deductions in earnings over 6 per cent on the estimated property values. Revenues and Expenses. In this section of railroad data may be found a complete analysis of the operating revenues and expenses of each of the leading railroads, together with a summary, by means of which it is possible to determine for each month and for the cumulative period, the make up of a company’s revenues by months, as between freight and pas- senger, etc., as well as the division of the major expenses, taxes and rentals. Herein the investor will also find the ratio of each main expense classification to total gross revenues for the year to date, as well as the ratio of total operating expenses to total gross revenues, that is, the operating ratio. Individual Company Analyses: In connection with the in- vestment service on railroads, complete analyses of individual railroad companies are available to the investor monthly. These analyses contain in general the following information : Summary of the Railroads Position and Outlook Outlook for Common Stock Outlook for Preferred Stock History of Road Property Territory Served Growth of Territory Routes and Connections Character of Traffic Map — Showing lines of system Development of Traffic Earning Power Capitalization Maintenance and Expense Ratios Outstanding facts regarding the road Growth of Property Invest- ment Financial Condition Consolidation Prospects Freight Traffic Growth Outside Investments Land Earnings Plowed Back Equipment Expansion Efficiency of Operation Equity and Dividend Record 270 WALL STREET News and Comment Section. Under this section, in which the information is available from week to week, the investor will find analyses and forecasts of the general security market situation and its relation to the rail market, together with in- formation on the securities of railroads which may be in a favorable position for purchase, or otherwise, from both the speculative and investment standpoints. Here also may be found information and data concerning: Agriculture — Crop values, Tonnage composition of rev- enue freight. Grain loadings of leading grangers. Application for New Security Issues. Animals — Tonnage composition of revenue freight. Bad Order Cars — By months. Bad Order Locomotives — By months. Bonds & Maturities. Car Loadings— Total loadings of all roads published week- ly. Loadings of individual and selected roads and average car loadings. Car Surplus — Weekly information. Comparative Rail Stock Prices. Cheapest Rail Stocks on Earnings. Charts — Trend of total freight traffic. Car Loadings of bituminous roads by weeks. Car loadings of anthra- cite roads by weeks. Grain loadings of 12 granger roads by weeks and car loadings by weeks, etc. Coal — Consumption and Costs. Consolidation — Developments affecting stock prices. Dividends — Changes ; prospects ; comparisons. Earnings — Outlook ; comparisons ; highest per share, etc. Employment — Statistics and comment. Equipment — Condition of — orders placed. Expense Ratios — By months. Forest Products— Tonnage composition of revenue freight. Freight Car Movements — By months. Freight Traffic — Actual by months, prospects, etc. Fuel Consumption— And Costs, by months. Index of Stock Prices — Rails and Industrials. Interstate Commerce Commission — Rulings and decisions, etc. 271 WALL STREET Legislation — Politics and the railroads. Margin of Safety — Safety margin, principal roads com- pared. Mine Products — Tonnage composition, leading railroads. Mergers — Possible, etc. Money Rates — Effect on rail market. Net Operating Income— Selected roads. Operating Statistics — By months. Records of previous year. Rates — Mail rate increases. Western trunk line freight rates, etc. Revenue and Expenses — By months. Share Earnings — Estimated per share earnings at recap- ture point. Actual surplus and share earnings. Transportation Act. Valuation of Railroads — Recapture point per share, etc. Wage statistics by Months — Controversies, disputes, etc. Yields — Highest; lowest; comparisons, etc. Statistical Annual. In addition to the information available in the foregoing sections, the information provided in the in- vestment service on railroads also includes a Statistical An- nual, which, appearing yearly, contains important annual data concerning all the leading railroads, both collectively and in- dividually, and is of value for general purpose statistics and for making long term comparisons. DIVIDEND RECORDS Primarily of value to the cashier or dividend clerk, Stand- ard’s Dividend Records provide dividend information on more than 6,200 stocks, among which are included securities of in- dustrial and public utility corporations which are listed or have only a local market. These records give the dividend rate, name of the corporation, last dividend, books close date, books open date, dividend payable date, amounts paid last year and this year. This information is revised daily, and the last divi- dend is carried on the sheets as a permanent record until a new dividend is declared. In addition, a weekly dividend calendar, covering over 6,200 stocks, gives a day-by-day record of all routine dividend developments which take place affecting these stocks during each succeeding two weeks. 272 WALL STREET TRADE AND SECURITIES SERVICE The information available here is of particular value to those interested in watching the trend of securities and business. It makes available analyses and forecasts of business and finan- cial conditions and security price trends, and includes analyses and forecasts of the outlook for the key industries, and the leading securities in each industry. Among the industries, commodities and security groups on which information of this character is regularly available are the following: Agricultural Implements Apparel Automobiles and Trucks Automobile Parts and Accessories Automobile Tires, Rubber Goods, etc. Building, Real Estate & Related Lines (a) Asphalt and Cement (b) Equipment, supplies and construction (c) Property ownership and management Chemicals (Industrial) Coal and Coke Copper and Brass Cotton and Cotton Goods Electrical Equipment Farm Products Fertilizers Railroads Rayon Shipping and Shipbuilding Silk and Silk Goods Steel and Iron Sugar Producing and Refining Theatres and Motion Pictures Tobacco and Tobacco Products Utilities — Electric light, power, gas, heat, water, etc. Unclassified Industries and Commodities 273 WALL STREET Food Products (Other than meat) (a) Baking products & flour (b) Candy, soft drinks & chewing gum (e) Dairy products (d) Miscellaneous Household Products and Supplies (a) Floor coverings (b) Ice and Refrigeration (c) Miscellaneous Lead and Zinc Leather and Shoes Machinery and Machine Equipment Meat Packing Mining and Smelting Office and Business Equipment Oil Producing and Refining Paper and Paper Products Radio, Phonograph and Musical Instruments Railroad Equipment Retail Trade (a) General — Chain Systems and department stores (b) Groceries (e) Mail Order (d) Restaurant (e) Tobacco Utilities — Telegraph, Telephone, etc. Utilities — Tractions, bus and motor transporation, etc. Wool and Woolen Goods Information on most of the above subjects is available monthly, giving complete and up-to-date statistics on prices, production, consumption, distribution, etc., with long term comparisons. In addition analyses of sales and credit condi- tions and trends, in every State and in more than two hundred of the leading cities of the United States are included. Here also, summarized monthly in convenient form for ready refer- ence, is found the latest significant financial and earnings data relative to about 650 leading common stocks. 274 WALL STREET OTHER SOURCES OF INFORMATION ON SECURITIES, TRADE, FINANCE AND BUSINESS CONDITIONS Other sources of infonnation used by the statistical depart- ments of investment houses and available directly to the in- vestor or through investment banking and brokerage houses are the following: Listing Requirements of the New York Stock Exchange. All corporations whose securities are listed and traded in on the New York Stock Exchange must, before this right is granted, file with the New Yox-k Stock Exchange on its listing applica- tion, a detailed statement giving information which includes the following : Where incorporated; date and duration of charter; business; special rights or privileges under charter or by-laws ; whether capital stock is full paid ; non-assessable ; and whether liability attaches to shareholders. Issues (by classes); dividend rate and par value; total amount of each, authorized and issued ; increases and authority therefor, including (a) action by stockholders, (b) by di- rectors, and (c) by public authorities, etc.; amount unissued, (a) options or contracts on same, (b) specific reservation for conversion. If preferred stock; (1) whether cumulative or non-cumula- tive; (2) preferences, including, (a) voting power; (b) divi- dends; (c) distribution of assets on dissolution or merger; (d) redemption; (e) convertibility; (f) special provisions. Voting power of obligations of debt. Purpose of issue; ap- plication of proceeds; amount issued for securities, contracts and property; additional property to be acquired, etc. History of the corporation ; of predecessor companies or firms; with location and stock issues (by classes); conditions leading to new organization. Tabulated list of constituent, subsidiary, owned or controlled companies, showing date of organization, where incorporated, etc. Mortgage, and other indebtedness showing, date, maturity, interest rate, convertibility, redemption by sinking fund or otherwise, etc. 275 WALL STREET Plant and Properties, giving description, location, nature and acreage of property; Equipment; character of buildings and construction, etc. Policy as to depreciation. Character and amount of annual output for preceding five years; estimated output (character and amount) for current year; number of employees. Financial statements ; earnings for preceding five years, if available with interest charges, depreciation and federal taxes; income and surplus account of recent date for at least two years, if available ; balance sheets of same dates ; balance sheet giving effect to recent financing, if any, etc. In addition to the foregoing, other pertinent information is also required in connection with applications filed for listing by (1) corporations which own or operate mines, (2) Invest- ment Trusts, and (3) for the list of foreign shares, special in- formation is required. Investment and Financial Periodicals. Among the more im- portant publications furnishing information and statistical data on investments, finance, trade, industry and general busi- ness conditions are, The Commercial & Financial Chronicle, Barron’s, Wall Street Journal, Magazine of Wall Street, and the Ann alist,. The information and data supplied by these publications covers practically every aspect of investment and business information, and provides an enormous amount of current financial information, including security price quota- tions, detailed analyses and comment on individual companies, summaries of annual corporation reports, current earnings statements, production figures, and in general any and all available news of corporations whose securities have been dis- tributed in the market. Trade Journals, Government Department and Publications, Trade Associations and Institutes Other important sources of information, including primary and secondary sources, are those represented by the various trade journals, Government publications and departments, and trade association and institutes. Among these are: (1) Rail- way Age, (2) The F. W. Dodge Corporation, (3) Federal Re- serve Board, (4) United States Dept, of Commerce, (5) U. S. Dept, of Labor, (6) U. S. Dept, of Agriculture, (7) The Iron 276 WALL STREET Age, (8) Bradstreet’s, (9) National Lumber Manufacturers’ Association, (10) Dun’s Review, (11) United States Dept, of the Interior, (12) American Bureau of Metal Statistics, (13) American Iron and Steel Institute, (14) American Petroleum Institute, (15) American Railway Association, (16) Silk Asso- ciation of America, (17) American Metal Market, (18) Federal Reserve Bank of New York, (19) American Zinc Institute, (20) Association of Cotton Textile Merchants of New York, (21) Bureau of Railway Economics, (22) Interstate Commerce Commission. MARKET LETTERS AND INVESTMENT REVIEWS The preparation of investment reviews and market letters represents an important part of the work of the Statistical Department of investment and brokerage houses. These are issued weekly or from time to time with more or less regularity in connection with the new business activities of the houses, being sent to the firm’s customers and to prospective customers as bids for business. They also serve to keep the clients of the house informed on matters pertaining to their investment or speculative activities. They usually present in summary form the essential or current significant facts relating to the business and finan- cial situation the conditions and outlook in specific indus- tries, and the position and prospects of individual corpo- rations, together with information as to current developments affecting the securities of various corporations. In the prep- aration of these reviews the developments of the past week or month in the stock market will be reviewed, the present situa- tion will be discussed, and the probable immediate trend of the general market, of particular groups of stocks, or of individual securities will be considered. In connection with the discussion on the general market, the position of the market may be con- sidered from the standpoint of the fundamental factors affect- ing the general market situation and also from the standpoint of its technical position. In addition significant recent devel- opments as they relate to the existing conditions in the stock market and their probable effect upon the immediate, short or long term outlook will also be discussed. In some reviews the general situation in the bond market will be considered in detail or in siimmary form in the same 277 WALL STREET general manner as the stock market. The financial situation, credit conditions and money rates will be considered in more or less detail. Also, the trend of bond prices will be reviewed and discussed, and the position of particular classes of bonds will be considered. In some cases the reviews will be devoted entirely to a con- sideration of the conditions in specific industries, as affecting particular groups of stocks, such as for instance, the Rails, the Oil stocks, the Rubber companies, the Automobile companies, etc., and the probable outlook for the industry for the coming year will be discussed. In considering the conditions of a par- ticular industry its statistical position, that is, the figures on production, consumption and stocks on hand will be presented and analyzed; prices will be considered, and where over pro- duction exists in the industry the probable effect of this on prices and on the net profits of the companies engaged in the industry will be considered. Summary analyses may also be included in such reviews on a selected list of the corporations engaged in the particular industry discussed, giving the essen- tial or significant factors, together with opinions and sugges- tions as to the relative desirability in the opinion of the writer of the review of the securities analyzed from the standpoint of their investment or speculative merits. Market letters, reviews or investment circulars are also pre- pared and distributed by the Statistical Department in which an analysis may be made in considerable detail with respect to the activities and prospects of a single corporation, while in other cases such reviews or circulars will supply in summary form the essential investment data on a number of different securities which the house considers represent desirable securi- ties for either investment or speculative purposes, and in which it is desirous of interesting its clients. In addition to the more or less detailed discussion of the general market, and of individual industries and corporations, many of these reviews supply information and news concern- ing current developments in the affairs of a great variety of corporations. This information usually covers such items as, quarterly, semi-annual or annual earnings figures, expansion plans, merger prospects, announcements of dividend changes, changes in management, et cetera. Following is shown a more or less typical example of an in- vestment review or market letter. 278 WALL STREET WOODBRIDGE & DAY INVESTMENT REVIEW Monthly Summary of Timely Investment Information BOSTON • NEW YORK • CHICAGO • CLEVELAND - DETROIT ■ PROVIDENCE PORTLAND, ME. PITTSBURGH SEPTEMBER, 1929 STOCK MARKET T HE month of August was dis- tinctly one of advancing stock prices in all departments. The Dow-J ones industrial average, starting the month at 347.70, ad- vanced with few interruptions to a new record high of 381.17 on Sep- tember 3rd. The railroad average (Continued on page 280) BOND MARKET T HE bond market during Au- gust held within a range of less than one point. The Dow-Jones average of 40 bonds made its high of 92.86 on August 3rd and its low of 92.10 on August 26th. Second grade rails showed the widest range, fluctuating from 94.00 on (Continued on page 280) 279 WALL STREET INVESTMENT REVIEW Stock Market, Cont. (Continued from page 279) likewise advanced from 173.43 at the beginning of August to a new record high of 189.11 on September 3rd. While the copper average did not reach the former high of 95.80 touched last March, it appreciated from 77.05 to 89.94, the latter fig- ure on September 6th. Subse- quently, the industrials, railroads and coppers have declined, stand- ing on September 12th at 366.35, 181.18 and 80.35 respectively. Sales on the New York Stock Exchange continued large in August, aggre- gating 95,704,890 shares, being ex- ceeded only four times in the his- tory of the Stock Exchange, com- paring with 93,378,690 shares in July and 67,191,023 shares in August 1928. Brokers’ loans as re- ported by the Federal Beserve as of September 11th established a new record at $6,474,000,000, up $120,000,000 for the week, up $522,- 000,000 for the month and up $2,089,000,000 for the year. Only $138,000,000 of the increase re- ported during the month was for “own account’’ while $289,000,000 represented loans ‘ ‘ for others ’ ’, in- dicating that the major part of re- quirements were provided by cor- porations, individuals and others outside of the Federal Beserve System itself. TJ. S. Steel Corp. reports unfilled orders on August 31st of 3,658,211 tons, down 429,966 tons for the month and the fourth consecutive monthly de- cline, but 34,168 tons larger than a year ago and the largest reported in August since 1923. While the decline in August this year was larger than anticipated, it is not considered alarming in view of the fact that operations throughout the summer have been at a record rate. They are now reported at about 91% of capacity, against 94% late in August and 77% at this time last year. Car loadings for the week ended August 31st of 1,160,210 ears were the largest to date this year, against 1,116,711 in the same week of 1928 and the 25th consecutive week to show an increase over 1928. Loadings for the first 8 months this year total- ling 35,334,977 cars represented an increase of 4.7% over the same period of 1928. In spite of record brokers’ loans, rates for money continue relatively easy, indicating no shortage of funds for all legitimate purposes, and a reflec- tion, perhaps, of the conviction among corporations, wealthy indi- viduals and others than their sur- plus funds may be safely employed in loans to brokers secured by Stock Exchange collateral even on the basis of present levels of prices. In the light of such a credit situation and the continuation of satisfactory business conditions, we continue optimistic on the bet- ter grade of securities, whose earn- ings trend and outlook are favor- able, particularly the railroads and coppers. Woodbridge & Day solicit conservative margin accounts 280 WALL STREET INVESTMENT REVIEW Bond Market, Cont. (Continued from page 279) the 10th of the month to 92.04 by August 26th followed by high grade rails which fluctuated 1.21 during the month. Industrials and public utilities fluctuated .65 and .66 respectively within the month. New bond offerings in August were the lowest for any month of the year, $129,678,000 for the month comparing with $242,092,000 for July, $344,697,000 in June and an average for the 8 months of $284,- 858,000. Fisher’s Commodity Index indicated a downward trend, 97.3 compared with 98.6 in July, 97.0 in June and 98.2 as an average for 1928. The Federal Reserve state- ment of September 11th showed a slight increase in reserve ratio, ENGINEER’S PUBLIC SERVICE E ngineers public service joins under a single ownership and under able management, groups of properties well diversi- fied geographically, the major groups being in Texas, Virginia and around Puget Sound. Manage- ment ability is indicated by the awarding of the Charles A. Coffin Foundation 1928 gold medals for the greatest contribution to the de- velopment of light and power serv- ice and of electric transportation service to Puget Sound Power & Light and Virginia Electric and Power respectively. For the year ended July 31, 1929, gross of the operating companies increased to $49,035,998, up 7.3% from the pre- vious year, while net operating revenue increased 9.6%. Net per 73.7% against 73.2% a week ago, 74.6% a month ago, and 68.0% a year ago, with gold reserves of $2,971,735,000, up $28,367,000 from a week ago, and $342,789,000 greater than a year ago. Total bills discounted of $972,927,000 were down $73,089,000 from a week ago and down $96,319,000 from a year ago, while U. S. securities held in- creased $10,037,000 and bills bought in the open market in- creased $39,313,000 for the week. These changes indicate some de- gree of Federal Reserve relief to the money market, but until more definite ease is in prospect, bond prices may be expected to hold around present levels. common share on the average num- ber of shares outstanding during each twelve month period increased still more rapidly from $1.33 a year ago, to $2.62 for year ended July 31, 1929, these figures being after exceptionally heavy depreciation and maintenance charges, and in spite of earnings of Puget Sound properties being retarded this spring by severest water deficit in the history of the weather bureau. Growth of gross and net has been exceptionally rapid in the Texas properties, with continuance prom- ised by growth of the territory and such new contracts as with recently built oil refineries and the new Nichols Copper Company refinery. Steady growth of all the operating companies promises to continue, and further improve the earnings for the common stockholder. W oodbridge & Day buy and sell high-grade investment securities 281 WALL STREET INVESTMENT REVIEW TIMKEN ROLLER BEARING TNCREASING demand for the A high quality steel which has contributed substantially toward placing Timken Roller Bearing in its present dominant position in its field, and growing sales of bear- ings, required an expenditure in 1928 of $8,300,000 for additional and improved facilities, with $4,- 500.000 of further expenditures contemplated for 1929. Thirty-five of the forty principal makes of motor cars in this country use Timken bearings. 116 steam rail- roads and 26 electric railroads are now using Timken bearings on rolling stock, some of the Timken equipped passenger cars having operated satisfactorily more than 400.000 miles. Expanding industrial use of Timken bearings includes not only machine tools and motors but also heavy service such as steel mills, cement and sugar ma- chinery, printing presses, etc., where anti-friction bearings were formerly thought possible. 1928 marked further foreign expansion with the formation of French and German manufacturing companies, these, as well as British Timken, Ltd., controlled by the American company. Earnings have expanded steadily from $2.42 per share in 1924 on the present common shares to $3.98 in 1927 and $13,730,145 or $5.71 in 1928. For half of 1929 net was $3.51 per share, against $2.66 a year ago. The year-end balance sheet showed exceptional strength, with cash and marketable securities alone of $17,632,000, against current liabilities of only $4,467,000. Aggressively continu- ing the development of the railroad and industrial field, in addition to continuance of its expansion in the automotive field and as a high quality steel producer, the future should see continued growth of Timken ’s earning power. BETHLEHEM STEEL B ethlehem steel, second largest steel enterprise in the world, is completely integrated from raw materials to a broad line of steel products, and extensive finished products such as engines, machinery and tools, ships, and passenger and freight cars. In the past five years $157,000,000, largely from income and reserves, was ex- pended on an extensive program of modernization and rebuilding, which has resulted in radically low- ering the cost of producing steel. Proceeds of 600,000 common shares offered to stockholders in May this year (about $50,000,000) are to be used for further develop- ment, including the expansion of certain facilities where demand has exceeded capacity. Earnings had moved irregularly forward to $6.52 per common share in 1928, while in the first half of 1929 they increased to $7.21 per present com- mon share, against $2.51 a year ago on the then smaller number of common shares. Second quarter operations reached 100.6% of ca- pacity, and while rate has since declined, an excellent volume is promised for the remainder of the year. The offer of 800,000 addi- tional common shares at $110 will bring in enough to cut approxi- mately in half the funded debt of the company including subsidiaries, thus greatly improving the capital structure and position of the com- mon shares. W oodbridge & Day solicit conservative margin accounts 282 WALL STREET INVESTMENT REVIEW BANGOR & AROOSTOOK DAN60R & AROOSTOOK, oper- •*-* ating 614 miles of main line and branches in northern and east- ern Maine, from the seacoast at Searsport at the mouth of the Pe- nobscot, northerly to the Canadian border, is notable among New Eng- land roads for originating a large part of its traffic from territory served. Although known as the “Potato Road,” with about one- third of its tonnage from that source, its traffic diversity is stead- ily increasing, particularly in pulp- wood, paper, and coal. Roadbed and equipment are excellently maintained and steady improve- ment of operating efficiency indi- cated by rise of average gross tons per train from 838 in 1921 to 1047 in 1928, and decrease of coal con- sumption per thousand gross ton miles from 172 lbs. in 1921 to 135 in 1928. Net earnings reached their peak in 1927, with $8.41 per com- mon share, slightly declining in 1928 to $6.94, with lighter and lower priced potato crop. For seven months of this year net was $6.37 per common share against $5.77 in the same period a year ago. Au- gust carloadings were up 5% from a year ago, and for week to Sep- tember 5th they were up 69%, with potato crop moving earlier than last year. With a splendid crop promised and at much better prices, the territory and the road should prosper together, and bring net earnings well above a year ago, to the 1927 level or better. The recently authorized increase in cap italization might conceivably in- dicate further funded debt reduc tion, with stock offered to stock holders at an attractive price. Why Insurance Stocks as a Group are a Purchase at Present Prices: 1. Insurance is one of the most popular investments today. 2. The tremendous growth of the use of all kinds of insurance assures the future growth of all the progressive companies. 3. Premiums paid in arc invested in high grade securities covering a cross section in the fundamental industrial and utility fields of the country. 4. Insurance Stocks have not appreciated in value to the extent that the investments behind’ them have. In fact, many stocks are cheaper than at the first of the year. Wo would buy to hold, the following: Earnings FIRE & CASUALTY No. of Par Admitted Per Sh. Annual Price COMPANIES Shares Value Assets 1928 Dividend about Aetna Fire Ins. Co._ 75,000 100 $59,665,904 $62.47 20 805 Boston Ins. Co 30,000 100 24,697,126 137.96 16 1100 Continental Ins. Co 1,500,000 10 91,655,480 8.21 2 107 Fidelity Phoen. Fire 1,000,000 10 72,865,031 10.87 2 118 Glens Falls Ins. Co 500,000 10 21,527,957 2.90 1.60 69 Globe & Rutgers 70,000 100 98,190,645 182.38 24 1590 Great Amer. Ins. Co 1,600,000 10 67,194,853 4.31 1.60 48 Vs Hartford Ins. Co 100,000 100 92,621,326 86.33 22 1080 W oodbridge & Day underwrite sound American Securities 283 WALL STREET INVESTMENT REVIEW Home Fire Ins. Co._ 180,000 100 102,797,291 52.61 20 700 Mass. Bonding & Ins 160,000 25 19,013,461 11.23 4 220 No. River Fire Ins.* 80,000 25 25,772,402 62.44 8.50 470 Priv.- Washington 30,000 100 22,486,318 141.23 20 1100 St. Paul Fire & Marine 160,000 25 32,217,597 11.44 5 245 Springfield Fire & Mar LIFE COMPANIES 200,000 25 37,023,869 19.32 4 240 Sun Life Assur. of Can 20,000 100 488,958,706 25 3500 Travelers Ins. Co. “ “ Rts. 200,000 100 553,857,160 24 1860ex 248 *With the reduction in par October 1, 1929, from $25 to $10, a 100% stock dividend is also to be paid to stockholders of record September 16th which will amount in all to a five-for-one split-up. The Trading Department in our nearest office will gladly handle your orders. CURRENT INFORMATION HUDSON MOTOR First eight months shipment 16.2% ahead of year ago and best period in company’s history, being less than 15,000 units from full year 1928. BANGOR & AROOSTOOK Seven months surplus after charges $821,681, against $758,358 year ago. Excellent potato crop promised. MASSACHUSETTS UTILITIES ASSOCIATES July gross of operating compa- nies up 9.0%, 12 months gross up 5.9% from year ago. Balance avail- able for dividends, depreciation and reserves up 5.8% for July, 5.9% for 12 months. NATIONAL FIREPROOFING Six months net available for in- terest $512,315 or 6.27 times inter- est requirements. June 30 current assets $3,988,136 against current liabilities of $900,721. Plants at capacity. AMERICAN CHICLE Six months net $1,039,167 or $2.27 per common share against $892,391 year ago. June 30 current assets $4,012,645 against current liabilities of $944,962. Stock divi- dend of 15% to be paid stockhold- ers of record September 25. WILLIAM WRIGLEY Six months net $5,211,990 or $2.89 per share against $4,907,162 year ago. NORTH AMERICAN AVIATION Six months net $1,172,080 or $.59 per share. June 30 total assets $26,373,401 including $22,365,150 cash and marketable securities. BEECH-NUT PACKING Six months net before taxes $1,553,242 or $3.24 per common share after estimated taxes, against $1,510,484 year ago. June 30 cur- rent assets $11,962,734 including cash and marketable securities of $1,858,965 against $714,257 current liabilities. W oodbridge & Day buy and sell high-grade investment securities 284 WALL STREET INVESTMENT REVIEW LEHIGH PORTLAND CEMENT Net after taxes for year ended August 31, $3,676,051 or $4.81 per common share against $3,814,393 year ago. AMERICAN HOME PRODUCTS Six months ended June 30 net $1,597,693 or $2.67 per share against $1,345,243 in first half of 1928. IRVING AIR CHUTE First six months net $251,689 or $1.20 per share. July net $55,023. Unfilled orders 36% greater than 1928 entire output. New types of parachutes being developed. CONSOLIDATED FILM Eight months ended August 31 $1,597,090 or $5.32 per preferred share and $2.28 per combined pre- ferred and common share on a par- ticipating basis against $977,198 year ago. August net $224,327, a new record. NEW HAVEN July net after charges and pre- ferred dividends $1,380,590 or 87e per common share against $830,209 or 53c per share year ago. Seven months net $7,328,977 or $4.66 per share against $3,061,485 or $1.95 per share year ago. Stock placed on $5 annual dividend basis with payment due October 1. HOLLAND FURNACE Six months net $540,641 or $1.16 per common share against $278,785 year ago. June 30 current assets $12,413,993 against current liabili- ties of $2,058,726. PHELPS DODGE First six months net before de- pletion $4,481,497 or $2.24 per share. Only 55% of output sold during period and balance inven- toried at cost. Property better- ments together with construction of new plants should bring about still lower production costs. EASTMAN KODAK Stockholders of record August 30 were offered one new share of common at $150 for each ten shares held. Rights expire and full payment due September 28th. BUCYRUS-ERIE Bucyrus-Erie offering rights to subscribe to new common shares at $25, one for each ten held, pro- ceeds for the purpose of partici- pating in formation of Ruston- Bucyrus, Ltd., to combine excava- tor business of Ruston & Hornsby, Ltd., of Lincoln, England, with foreign business of Bucyrus-Erie. The statistics in this circular are obtained from sources which we believe to be accurate. Opinions expressed herein are given as such. Woodbridge & Day underwrite sound American Securities 285 . CHAPTER XII The Method of Auditing a Stock Brokerage Firm AUDITING A STOCK BROKERAGE FIRM The auditing of the books of a Stock Brokerage Concern is usually conducted at the end of the month at which time the statements are being forwarded to customers. In anticipation of an audit the head bookkeeper will instruct his assistants to make a statement for every account on the customers ledger and to have all the other accounts properly ruled off and brought down showing plainly the security and money balances. An audit of this character verifies all security positions, the location of securities, and all open transactions as well as the money balances. The routine for this work is as follows : 1. Count all securities that are actually in the of- fice, i.e., in the box, safekeeping and private envelopes. 2. Verify petty cash on hand with ledger balance. Reconcile bank balance. 3. Count Federal and State transfer stamps and verify with balance in ledger. 4. Confirm all securities that are pledged as col- lateral in loans with Banks and Trust Companies. 5. Confirm all securities that are in transfer. 6. Confirm with other brokers all fail to receive and fail to deliver items, also stocks borrowed and loaned. 7. Confirm all “when issued” contracts. 8. Mail all statements received from the book- keeper to the firm’s customers together with a form showing the customers money balance and position, and request the customers to verify this form and return it. 9. Balance each security. The total amount of the customers’ long securities and the “fail to deliver” 289 WALL STREET and “stock borrowed” items should equal the total of the securities in the box, safekeeping, transfer, bank loans, failed to receive and stock loaned items, and customers short position. If every issue of stocks and bonds balances, then the auditor knows that all securities are accounted for and the location of each is known. 10. Check the stock record, using the new record built up as the result of the audit. 11. Cash balance. 12. Final report. Counting Securities The work of counting securities must be handled in such a way as not to interfere with the operation of the office. As- suming that the audit is to be made on the 31st of the month, the auditors usually start counting the safe keeping and in- active boxes on the morning of the 30th or 31st. If there are any withdrawals, or deposits of securities affecting these boxes during the operation of counting, a proper record should be kept. As soon as the remaining securities are available after the close of business on the 31st, the auditor should have a large force of men on hand to accomplish as much as possible before the boxes are taken to the vault. When the boxes are relin- quished that night they are sealed until the counting is re- sumed the next morning which should be as early as possible. It will be found by using this method that a complete count can usually be made before the securities are required by the Cashier’s Department. However, in any case, the work of counting must be finished before any changes are made. The securities must be properly listed with full title of Com- pany giving details of classification ; such as, Common, Pre- ferred, Voting Trust, etc., Rate and Maturity of Bonds, and any other data which would properly identify the security. Listings are made under the heading of : “Box,” “Safekeep- ing” and “Private Envelope.” 290 WALL STREET Petty Cash and Bank Balance It is the usual custom to set up a debit in the ledger covering a specified amount of Petty Cash. Assuming that the ledger shows a debit of $500 in the Petty Cash Account this amount, either in cash or Charge Slips, should be in the cash box. This is verified by the Auditor. It is sometimes necessary to question some of the charge slips. For instance, there may be several I. 0. U’s. signed by employees against their salary. It is then necessary to ascer- tain the firm’s policy in matters of this kind. The Bank Statements, together with Vouchers or Cancelled Checks, should be given in their original mailing packages to the Auditors. The customary Reconciliation is then made and the Final Balances checked with the Bank Credits shown on ledgers and blotter. Any difference must, of course, be fol- lowed through and after a satisfactory explanation must be properly adjusted to bring the books and Bank Statements into balance. Federal and State Transfer Stamps An actual count of the stamps on hand is made and verified with Ledger Debit Balances. Usually some small differences will be found in these accounts which should be noted. Any large differences must of course be checked out. Verifying Collateral in Loans The auditor will obtain the complete record of loans from the loan clerk and then verify the amount of loans and the collateral by confirming with all banks, trust companies, etc., in the following manner : 291 WALL STREET Seaboard National Bank, Oct. 31st, 1929. New York. Our auditors, Jonas, Camp & Co., are now making their regular examination of our accounts as at the close of busi- ness on the above date and in connection therewith they desire to have you verify the correctness of loan summarized below. Your prompt compliance with this request by signing at the bottom of this form will be appreciated. A stamped addressed envelope is enclosed for your con- venience. Very truly yours, Blank & Company. We are borrowing from you $100,000 against the following collateral : 200 General Electric 300 General Motors 200 Consolidated Gas 200 Continental Baking “a” 200 Radio 200 U. S. Steel 100 Remington Rand 100 Shell Oil. The above is correct. Signed DIFFERENCES, IF ANY, SHOULD BE TAKEN UP DIRECTLY WITH THE AUDITORS. Checking Securities in Transfer The transfer records are given to the auditor who compiles a list of all securities in transfer. From an auditing viewpoint there are many opportunities for deception in this part of the records and it is most im- portant therefor to use every precaution in this department. As explained under the chapter devoted to transfers, a win- dow ticket or receipt is usually given when securities are de- posited for transfer. However in some cases no receipt is given. There are various systems in use, one of which is to accept the window receipt at its face value and in the absence of a 292 WALL STREET receipt to write to the transfer office asking for confirmation that certain securities have been deposited. As the stocks are received back from transfer the auditor checks them off against his list until all items have been returned and ac- counted for. Some auditors will not accept the window receipt as being evidence that securities have been deposited for transfer, but will write for confirmation on every open item. Most transfer offices are now making a charge of $1.00 for each confirmed transfer. As the securities are received back they are of course properly recorded by the transfer clerk and the auditors. In the opinion of the writer the best system is to take pos- session of the window receipts and a record of all securities in transfer. An assistant will then personally present the re- ceipts and himself receive the stock. He will also call at the transfer office and receive securities for which no receipts have been issued. In this way the auditor is certain that the records are right and that no fraud or deception has been practiced. The letter written for confirmation is usually along the following lines : Oct. 31st, 1929. Registrar & Transfer Co., New York. Dear Sirs : Our auditors, Jonas, Camp & Co., are now making their ex- amination of our accounts as at the close of business on the above date and in connection therewith, they desire to have you verify the correctness of the items listed below. Your prompt compliance with this request by signing the certificate at the bottom of this form will be appreciated. A stamped addressed envelope is enclosed for your con- venience. Very truly yours, Blank & Company. We have deposited with you for transfer, Oct. 29/29 100 U. S. Steel Oct. 30/29 100 General Motors The above is correct. Signed 293 WALL STREET DIFFERENCES, IF ANY, SHOULD BE TAKEN UP DIRECTLY WITH THE AUDITORS. CONFIRMATION OF FAILED ITEMS, STOCK LOANS AND WHEN ISSUED CONTRACTS All open items with brokers should be confirmed in the fol- lowing way: Oet. 31st, 1929. Blue & Company, New York. Dear Sirs : Our auditors, Jonas, Camp & Co., are now making their ex- amination of our accounts as at the close of business on the above date and in connection therewith they desire to have you verify the correctness of the items listed below. Your prompt compliance with this request by signing the certificate at the bottom of this form will be appreciated. A stamped addressed envelope is enclosed for your con- venience. Yours very truly, Blank & Company. Dr. Cr. We are failing to receive from you 100 U. S. Steel 175 17500 We are failing to deliver to you 50 Gen. Motors 62 3100 We are loaning to you. . 100 Amer. Can 110 11000 We are borrowing from you 200 Radio 50 10000 We have bought from you 100 Baldwin when issued 36 3600 We have sold to you. . . . 100 Marine Mid. when issued 42 4200 The above is correct. Signed 294 WALL STREET DIFFERENCES, IF ANY, SHOULD BE TAKEN UP DIRECTLY WITH THE AUDITOR. In actual practice there would be six separate letters of confirmation sent out on these items as the auditors handle each account, and each side of these accounts separately. Confirmation With Customers As the statements are received from the bookkeepers the details must be listed on large columnar sheets for future use in building up the security position of the firm. Customer Debit Credit Long Short Harry Jones 22500.62 10500 50 U. S. Steel 100 Arner. Can 100 Genl. Motors 10 Beth. Steel 5’s 1930 Louis Campbell 4300. 100 Radio 100 Pac. Gas. John Morris 15600 100 Davison Chem. 100 Beth. Steel After the statements are listed they are mailed by the audi- tors to the customers, accompanied by the following form letter : October 31st, 1929. Mr. Harry Jones, 170 Maiden Lane, New York. Our auditors, Jonas & Camp Co., are now making their reg- ular examination of our accounts as at the close of business on the above date and in connection therewith, they desire to have you verify the correctness of the enclosed statement of your account with respect to the security position and money balances at that date as summarized below. Your prompt com- pliance with this request by signing the certificate at the bot- tom of this form will be appreciated. A stamped addressed envelope is enclosed for your convenience. Very truly yours, Blank & Company. 295 WALL STREET Date Long Short Description Dr. Cr. Oct. 31/29 50 U. S. Steel 22500.62 100 Gen’l Motors 10 M Beth. Steel 5/1930 100 American Can 10500 The statement of my account as summarized above is correct. Signed DIFFERENCES, IF ANY, SHOULD BE TAKEN UP DIRECTLY WITH THE AUDITORS. It will be found that a great many customers neglect to reply and as the audit is not complete unless confirmations are re- ceived, second summary of the statement should be sent by registered mail, stamped with the following notice: SECOND REQUEST FOR CONFIRMATION Sent by Registered Mail Return Receipt Demanded In accordance with the provisions of our Employees Insurance Policy PLEASE EXAMINE AND REPLY AT ONCE Your cooperation would be greatly appreciated. This will usually accomplish its purpose but letters must be sent until all confirmations are returned properly signed. Reaching a Security Balance After listing the customers’ statements the auditor is in a position to balance securities. Consolidating all records, which would include box, safe- keeping, transfer, loans, fail to receive, stocks loaned, stocks borrowed, fail to deliver and customers and firm positions, a recapitulation would be made of each security, as follows : 296 WALL STREET Long U. S. Steel Short Harry Jones 100 Box 200 E. W. Kohler 600 Safe-keeping 300 John Henley 325 Transfer 300 Martha Young 220 Loan Guaranty Trust 200 Loan Hudson Trust Co. 100 Fail Deliver 100 Fail Receive 145 Stock Borrowed 200 Stock Loaned 100 Raymond Brown 200 1545 1545 A sheet similar to the above would be compiled on every security appearing on the books, although all of the general ledger accounts such as stock borrowed, failed to deliver, etc., would not necessarily be involved. For instance, an inactive stock might be balanced as follows : NATIONAL ACME Long Short John Gould 100 Box 100 OR AMER. CAR FOUNDRY PREFERRED Long Short Edward James 75 Fail to Receive 75 Taking the recapitulation of U. S. Steel as an example, it will be noted that 1545 shares appears on both long and short sides. Analyzing it further, customers are long 1245 shares and short 200 shares, the difference showing up in the general ledger account. Two items on the long side, namely, Fail to Deliver 100 shares and Stocks Borrowed 200 shares, may be questioned as it would be asked, “Why are you failing to deliver 100 shares and borrowing 200 shares while there are 200 shares in the 297 WALL STREET box, 300 shares in loans and 300 shares in transfer?” The answer would probably be that the 200 shares in the box were required for some special purpose and that it would be better not to substitute in the loans in view of the fact that 300 shares in transfer would be used to clean up these two items. As a matter of fact, the U. S. Steel recapitulation was made in this manner to show every account that might possibly ap- pear on the auditors’ security balance. It is unlikely that each security will balance on the first take-off as it is a practical certainty that clerical errors will have been made since the last audit. These errors must be rectified so that all security items are brought into perfect balance. While it is not a part of the auditor’s work to check the stock record, it has been found very practicable to give these security recapitulations to the stock record clerk to correct any errors that may have been made in that department. Cash Balance For the purpose of a cash balance and final report all ac- counts should be segregated as follows : CUSTOMERS Debit balances against long securities (fully secured). Debit balances against long securities (partly secured). Credit balances against short securities (fully secured). Credit balances against short securities (partly secured). Debit and credit balances against long and short posi- tions. Unsecured debit balances. Free credit balances. GENERAL LEDGER BALANCES Loans, bank balances, fail accounts, stocks loaned, stocks borrowed, commissions, interest, taxes, furniture and fixtures, firm trading accounts, error accounts, sus- pense account, dividend account, brokerage accounts, etc. PRIVATE LEDGER Partners drawing accounts, capital account, profit and loss account. 298 WALL STREET After securing a money balance, the auditor is now prepared for the final report. Final Report The final report should be made up in such a manner as to give the members of the firm a clear conception of the condi- tion of their business. Comment should be made on expense accounts when neces- sary and on unsecured and partly secured accounts. Clerical departments which are not functioning properly should also be criticized, with suggestions for improvement. The report is usually made up in the order mentioned under “Cash Balance,” giving the debit and credit balances, security position, market value and equity. This allows proper analyza- tion of each account and discloses insufficient margin, listed under partially secured accounts. Further comment should follow regarding safe-keeping. If an account is over-margined a portion of the securities therein should be taken from the margin account and placed in the safe-keeping department. The report is completed with a balance sheet and profit and loss statement which usually are made up along the following lines : BALANCE SHEET Oct. 31st, 1929 ASSETS LIABILITIES Current Assets Current Liabilities Cash on hand> Cash in banks Revenue stamps Time Loans Call Loans Acct. Payable (Customers (State & Federal) Accts. Receivable short) Acct. Payable Customers Accrued Expenses Dividend Account (Un- ( Customers) Firm Investments Stocks Borrowed Fail to Deliver Money Loaned Accrued Interest Accrued Brokerage Total Current Assets claimed) Stocks Loaned Fail to Receive Accrued Interest Accrued Brokerage Total Liabilities Capital 299 WALL STREET Other Assets Seats (N. Y. Stock Ex- change, N. Y. Curb Deposits with Stock Clearing Corp. Furniture & Fixtures Less depreciation Total Assets Total Liabilities & Capital Profit and Loss Statement The most important items of income for a brokerage concern are commissions and interest received from customers. How- ever, many large Stock Exchange Houses participate in secur- ity underwritings and maintain extensive trading departments which effect the profits to a very great extent. Profit and Loss Statements are usually set up as shown below: PROFIT AND LOSS Commissions Interest Firm Trading Accts Underwritings, participations, etc. Total Income Rent Salaries Stock Exchange Expense . . Clearing House Expenses . . Insurance Tickers Repairs Depreciation Miscellaneous Expenses Statistical Service, etc Total Expenses Net Profit 300 CHAPTER XIII Runners Department RUNNERS DEPARTMENT The personnel of this department consists of a head runner, and as many messengers as may be required to handle the work. Location in Office The head runner remains in the office at all times. He is usually situated in a cage of his own in close proximity to the cashier’s cage, so that deliveries, transfers, etc., may be passed over to him conveniently. Inasmuch as the head runner is the temporary custodian of securities of great value no one except members of the firm and employees in the cashier’s department should be allowed access to the head runner’s cage. Qualifications Owing to the nature of his duties the head runner must be greatly experienced in the ways and customs of the street, the rules for delivery, Clearing House Rulings, addresses of all security firms, transfer offices, banks, etc. To operate his department in the most efficient manner the work must be systematized so that the head of the department will at all times know the name of the messenger delivering any particular item, the exact value of same, destination, time of de- parture from office, time of return, etc. A large properly ruled sheet, showing this information, is used for this purpose. Duties Briefly, the duties of the head runner involve the handling of the following classes of work: Obtaining signatures on comparisons and fail notices. Handling all matters pertaining to exchange of Clearing House tickets, demands, sheets, etc., both Stock Exchange and Curb. 303 WALL STREET Deliveries to Central Delivery department. Pickups from Central Delivery department. Deliveries against receipt, such as three-way items. Deliveries against payments. Certification of checks. Deposits. Making loans and substitutions. Deliveries to customers against receipt or payment. Putting securities in transfer. Receiving securities from transfer. Proper routing of all outgoing items so that one messenger can cover a maximum amount of ground. Having messengers on hand to take care of any pressing matters or emergencies that may develop. In addition to these well defined duties the head runner is subject to requests from the entire organization, for mes- sengers, for personal favors, lunches, etc. It must not be assumed from the above that the head runner actually makes loans, etc. He is simply the intermediary be- tween the cage, transfer department, clearing house depart- ment and the brokers, banks, transfer offices, etc. All deliver- ies, loans, comparisons etc. are given to him in complete shape and his work starts from that point. The day’s work usually starts with the distribution of fail notices and comparisons to the messengers, who must bring them back properly stamped or with an explanation of refusal to stamp. Fail Notices Fail notices signify that certain securities were not received or delivered on the previous day. If the item is correct it will be stamped. Fail notices must be delivered on or before ten o’clock of the day on which they are due, otherwise, they will in all probability be refused. Comparisons Comparison work involves the making of comparisons of transactions between brokers for the purpose of checking the purchase or sale and insuring the accuracy of the transaction. 304 WALL STREET Comparisons show the details of a transaction made the previous day, giving number of shares or bonds, description, price, and any other condition surrounding the transaction. They are issued in duplicate form, the original being returned to the issuing house. Comparisons may be made at any time during the day. Comparisons are not usually used in Stock Exchange deal- ings, Curb Dealings or odd lot dealings, as these trades are properly compared through the Clearing House or odd lot sheet. Their principal use is for unlisted securities. Deliveries « Immediately after 10 o’clock, the head runner begins to receive outgoing deliveries. Deliveries to the Central Delivery Department will be discussed first. Securities are pinned to a special form made up in triplicate. The first copy is retained by Central, the second copy, which is a receipt, is returned to the delivering broker, while the third copy is sent by Central to the receiving broker, together with the securities. Delivery is made to Central by a messenger who is properly identified by photograph and pass. Periodically during the day messengers are sent to the Cen- tral Delivery department to pick up any securities which may have been delivered by other brokers. The delivery of securities on the three-way sheet are made to the receiving broker instead of to the Central Delivery De- partment. No money is paid, the receiving broker merely sign- ing a receipt for the securities. The receipt is then sent to the Clearing House where the delivering broker receives proper credit. Such receipts must be in the Clearing House each day before 3 :45 P. M. Deliveries, resulting from the Curb Clearing House sheet and unlisted trades are delivered against payment. The messenger delivers the securities, receives a receipt pending examination of the securities and the preparation of the check, and returns later for the check. In the meantime the receipt remains in the custody of the Head Runner. Securities are delivered to customers against receipt or pay- ment, but the messenger waits for the cheek if payment is to be made. 305 WALL STREET As soon as practicable the head runner will start collecting the checks which are due. To obtain these the messenger will present temporary receipts and receive payment. Certification of Checks Judgment must be used in the certification of cheeks. It is the usual custom not to certify checks of less than $5,000 drawn by Stock Exchange Members. However in making deliveries to small unlisted houses and individuals, it is good policy to certify all checks. Certification must be made before 3 :15 P. M. After cheeks are verified as to the amount in the cashier’s department, the deposits are made up and given to the head runner. Loans and Substitutions Loans are also passed through the runner’s cage. Securities are listed on a large special envelope, showing the name of the lending bank, amount, interest, etc. The collateral is then delivered by messenger who receives a bank cashier’s cheek for the amount, or credit is placed in the pass book in the event of the firm having an account with the bank. Cashier’s checks do not require certification. Another early morning activity is substitutions in loans. The Loan Clerks make up the substitution forms as explained in the chapter on the Cashier’s Department under the work of the Loan Clerk. The forms and securities are sent to the banks by the head runner, the messenger returning with the with- drawn collateral. Transfers Many transfers are made during the day. The head runner receives the certificates from the transfer clerk, examines them to see if the names are properly filled in, and checks up the revenue stamps. The stock is then sent to the transfer agent, which may be a bank, the Company itself or an institution which specializes in corporate work. A window ticket or re- ceipt for the stock is usually given to the messenger. Stock going to transfer to be received back the following day after 1:30 P. M. must reach the transfer agent before 12 o’clock 306 WALL STREET noon. Stocks going to transfer after 1 :30 P. M. and up to 2 :15 P. M. will not be received back until two days later. On the date that books close for dividends, stocks affected by such closing dates may be delivered to the transfer agent up to 3 :00 o ’clock. At 1 :30 P. M. each day the head runner distributes the win- dow tickets received the previous day to the runners in order that they may pick up transferred stock. This must be done as quickly as possible as many of the stocks will be required for delivery before 2 :15 P. M. that day. Clearing House After the foregoing work is completed the runners are used in exchanging Curb and Stock Exchange clearing house tickets. Tickets giving details of each trade are exchanged at the Clear- ing House. Receive tickets are exchanged for delivery tickets and vice-versa. These tickets are really a form of contract certifying that one house will receive a certain amount of stock and that the other will deliver it. If tickets are made out too late to be exchanged at the Clear- ing House, they are exchanged by hand, that is, by direct delivery from one house to another. This is called a ‘demand.’ and in such cases the broker exchanging a delivery ticket will demand a receive ticket and if exchanging a receive ticket will demand a delivery ticket. One or two runners are always kept on hand after the ex- change of tickets, to make delivery of sheets to the Curb and Exchange Clearing Houses. 307 Part II What Investors Should Know Terms and Definitions Security Symbols — New York Stock Exchange Security Symbols — New York Curb Exchange ■ . ■ What Investors Should Know WHAT INVESTORS SHOULD KNOW Throughout the author’s experience in Wall Street, cover- ing a period of twenty-five years, he has had daily evidence of the fact that a large proportion of traders are extremely neg- ligent in the matter of properly examining their monthly state- ments. It is a fact that statements in the majority of cases are not examined at all, due either to carelessness, lack of under- standing, or through a bland confidence in the accuracy of the broker. While brokers put forth every effort to render statements correctly, errors involving interest, commissions, taxes, divi- dends, coupons, etc., will occur more or less frequently, and will seriously affect the status of the customer’s account. A trader, upon receiving his statement, should consider it seriously and take the necessary time to examine it thoroughly. The method to employ and the items to consider in this exam- ination are, as follows : 1. Refer to the previous month’s statement, and check the money balances and security balances brought down on the current statement. 2. Verify the position at the end of the current month. 3. Check all additions. 4. Check interest and rate of interest. 5. Take all notices of purchases and sales, together with all debit and credit notices, and check these item for item against the statement. 6. If you have not already examined such items as com- missions, taxes, accrued bond interest, etc., from bills or notices received during the month, this should be done at this time. 7. The frequency of dividend errors, as discussed elsewhere in this book, makes it desirable to closely scrutinize all security holdings to determine if any mistakes have been made in this connection. 313 WALL STREET Traders, when receiving their statements, are most naturally interested in ascertaining the equity in their accounts, and to illustrate the manner in which this is done we are presenting below two examples which show how this is figured. Example No. 1: Reflects a customer’s dealings in long stock only. March 31st — Balance $45,025.00 Long 100 U. S. Steel 100 U. S. Realty 100 American Can Long stock figured at market March 31st. 100 U. S. Steel $12,800.00 100 U. S. Realty 6,350.00 100 American Can 33,400.00 $52,550.00 Your equity would be the difference between the market price of your long stock, which is $52,550.00 and the balance due the broker March 31st, $45,025.00, which shows an equity of $7,525. Example No. 2: Reflects a customer’s dealings in long and short stock. March 31st — Balance $40,550.00 Long 100 U. S. Steel 100 U. S. Realty 100 American Can March 31st — Short 100 U. S. Rubber 7,700.00 100 Wabash 4,500.00 Long stock figured at market March 31st: 100 U. S. Steel $12,800.00 100 U. S. Realty 6,350.00 100 American Can 33,400.00 $52,550.00 Your equity would be the difference between the market price of your long stock which is $52,550.00 and the balance 314 WALL STREET due the broker on March 31st, $40,550.00 which shows an equity of $12,000. In figuring equity where you are long and short, disregard your short stock as shown above, 100 United States Rubber $7,700 and 100 Wabash $4,500, as these items are arbitrarily charged to your account at the market price before the balance is brought forward. All statements should be retained for future reference and income tax returns. A customer in one of the houses with which the author was at one time connected, had been trading actively for six or seven months. One day he came to me and said that although his own records showed that he had made money, he had just discovered quite a difference between his figures and those of the house. After spending two or three evenings checking back the monthly statements against his records it was found that he had neglected to take into consideration the interest charges on purchases which had not been closed out. Although he had calculated the interest on all his closed trades, he had not taken into consideration the interest charged on his open trades. Many of his open trades had been made six or seven months before, and showed, with the interest charged, a large loss at the market price. Always refigure all your commission, tax and interest charges. The following examples represent the two different types of statements that are used in Wall Street. 315 Example No. WALL STREET o o m 6 & d o OQ fl rd o O o O 00 o t>- O 05 in oo lO 00 *8 : h * ^ o < 3 '“ ip£| » . • 2 o o ±>0 ^o°?o O rH H H H d • 03 03 £ ' 05 TfH 03 CO tH r-H ih in t^05^ o' in b- i>- CO T— I O 03 • <0 : m • d s 2 a < *4 .oW O O O O O ' r ' i i ^ o o o o ®0 H rH C© H ^ m H §0 g s "SiO vO bo e- n P-H _ Ph d & M O co oo rH 03 ^ 0 ^ oT oT CO rH ^e- w a> M «8 a s CfiO t.* ® 5 c 8 3 x H < o < EH CO "3 *-s 316 WALL STREET In using this form of statement the interest is figured from the date on each debit and credit item to the end of the month. To illustrate : On the foregoing example showing 100 American Car and Foundry bought on July 2d, there is charged 29 days interest, and on the sale of the same stock on July 25th a credit of 6 days interest is shown. Interest is always figured at the rate of 6 per cent per annum and at the end of the month the balance of interest is changed to conform with whatever rate that is to be charged. In the foregoing example the balance of interest that the customer would owe at 6 per cent is $80.59, which represents the difference between the debit of $134.69 and the credit of $54.10. The amount of $94.02 which is charged as of July 31st is at the rate of 7 per cent for the month. This statement will show that as of July 31st the cus- tomer owes the broker $12,018.52, and is long 100 American Smelters and 100 Texas Corporation. 317 Example No. 2 Johnson, in Account with Otis & Co. WALL STREET o Pm 02 m $ $ ■^lODJ^OOOCOCO N01CQNP0050C5 HlOCOCCOOHtDIO h ci 0 ic i lO I u o oooooooo qoiqoioiooio icosoicoioco^ (MIOCOOOIOOOON (MOJOOOOOiOOHa lOiO H 1C ' < .S a a-g: I o o I o o CM q tH • vS> ro - 5 s ® n &,2> ft-g M G3 o M m . . ri CD.S S3 fl n S g O O) cS +> s w -*2 *5 £ ra ai H © C$ t. S PQ 318 July 31 Balance $12,018.52 Long 100 Amer. Smelt. & Kef. 100 Texas Corp. WALL STREET In this statement the interest is figured on the balances for each day. This is a duplicate of the transactions shown in Ex- ample No. 1 and it will be noted that the result is the same al- though the interest is figured differently. Dividends (Cash) There are thousands of corporations in the United States paying dividends, and the routine work involved in keeping the records with respect to such payments in financial houses is at times quite heavy. Because of this situation errors are frequently made in the making of dividend payments. More- over, it sometimes happens that it is difficult to obtain dividend information quickly concerning a particular company through the ordinary channels. At times it happens that brokers, ignorant of the fact that a dividend has been declared on a stock, often do not transfer it, when purchased, to their own or client’s name and this often results in the dividend being sent to the person or firm in whose name the stock is registered, but who no longer owns it. Unless this mistake is discovered by the broker or client, it will continue indefinitely, and the dividends will be sent to the wrong person or firm. In the case of listed, or active and well known unlisted stocks where dividend information is easily available, such errors are rare. In view of this general situation the matter of check- ing dividends is of the utmost importance, and it is suggested that the trader or investor make every effort to obtain accurate dividend information on the securities in which he is interested. If the dividend announcements published in the newspapers do not contain the information you require, your broker will gladly supply it, or give you the names of statistical bureaus which publish detailed dividend information. In the event that your broker is carrying an unusually inac- tive stock for you on which you can get no dividend informa- tion through the regular channels it is advisable to write, or have your broker write, direct to the secretary of the corpora- tion whose stock you hold. Every brokerage house has what is termed a “dividend account” for recording dividends received by them, to which they are not entitled. The aggregate of all these accumulated 3l& WALL STREET dividends runs into millions of dollars. Much of this enormous sum is lost by traders, and by investors throughout the country. The broker receives this money in excess of what is due him and places it in the Dividend Account awaiting claim. As evidence of the fact that this money never reaches its rightful owners, the records show that the greater proportion of these dividends remains unclaimed. It is not, of course, the intention to place the responsibility for these losses on the brokers. It is a fact, however, that even with elaborate checking systems, many mistakes do occur in brokerage offices, and it is therefore desirable that the investor and trader know enough about conditions in order that he may take such steps as may be necessary to promptly correct any mistakes that occur. In Wall Street language there are terms known as “Date of Trade” and “Date of Clearance”. The “Date of Trade” desig- nates the day on which the trade is actually consummated, and the “Clearance Date” designates the day on which the item appears on the broker’s books. For example, a purchase of 100 shares of stock made on Tuesday, February 23rd, would appear on the broker’s books under date of February 24th. If Febr- uary 24th is a holiday, the clearance date would be the next full business day. There are no clearances on Saturday, and therefore trades made on a Friday or Saturday clear on Monday, or on Tues- day in case Monday happens to be a Stock Exchange holiday. An easy rule of thumb method for recalling the general practice with respect to clearances is to keep in mind that all regular trades made on any date are cleared the next full business day. The dates mentioned hereafter in this explanation of divi- dend work refer particularly to the “Clearance Date” unless purchase or sale date is specifically mentioned. This practice is also followed by brokers in their reference to dates. When a corporation announces that a record will be taken of all stockholders, for the payment of dividends on a specific date, the Stock Exchange then rules that the stock will sell “ex-dividend” on the date set by the corporation, unless the stock carries what is known as a “Due-Bill”. (See chapter cap- tioned “Due-Bills”). The terms “Ex-dividend” means dividend deducted. There- 320 WALL STREET fore, if a stock is quoted “ex-dividend” February 20th, clear- ing the next day February 21st, the purchaser of the stock on February 20th is not entitled to this dividend. Stockholders of record selling long stock on February 20th, to clear Feb- ruary 21st, will receive the dividend. A case which will serve to illustrate how one kind of a mis- take is made in the matter of dividend payments is given below. An investment house owning 100 shares of Bush Terminal preferred stock, which was registered in their name, sold this stock in the latter part of 1921. This firm, however, still con- tinued to receive, along with the dividends on its other security holdings, the dividends on this stock, and it was not until the latter part of 1925, about four years later, that the mistake was discovered and a claim entered by the owner for the past dividends. In attempting to adjust this matter it was developed that the new owner had failed to register the stock in his name, and in this case, in view of the great lapse of time involved, it was for- tunate that the stock was registered in the name of a reputable broker. In the collection of claims for past dividends, a broker is only responsible when the stock is registered in his name, although he will make every effort to collect, should the stock be registered in the name of another firm or individual. If you oion stock outright, have it registered in your own name. If you are trading check your statements to make sure that you receive credit for all dividends and coupon interest you are entitled to. Dividends (Stock) “Stock Dividends” result when a corporation, through earn- ings, investments or otherwise, has built up a surplus which does not bear the proper relation to its capital, and the di- rectors then deem it advisable to reduce the surplus by issuing additional stock in the form of a “stock dividend”. Let us say that a corporation starting with a capital stock of $1,000,000, has over a period of years increased its surplus to $5,000,000. Its directors decide, therefore, to declare a “Stock Dividend” of 300 per cent, each stockholder receiving 3 shares for every one held, thereby increasing the capital stock to $4,000,000 and reducing the surplus to $2,000,000. 321 WALL STREET Assuming that the par value of the stock mentioned above is $100 and the market value approximately $600. After the stock dividend is declared, stockholders will hold four shares for every one share held previously, and the value of the four shares then held will be represented by a total value of about $600 or $150 per share. While the stockholder now holds four shares instead of one, the actual value of his holdings have not changed at the time the stock dividend is declared, although if this stock was pur- chased at par at some prior date, the holder’s original invest- ment has increased five hundred per cent in value. The real benefit derived from stock dividends from the in- vestor’s point of view is that represented by the probability of an increase in the dividend rate and accordingly in his in- come. Whereas the original stock may have been paying divi- dends at the rate of $25 per year, it is quite possible that the new stock may pay $8, thus giving a return of $32 on the total of four shares. This increase in dividends will ultimately be reflected in the increased market value of the stock. The provisions and terms involved in the issuance of new securities, vary according to the objects, requirements, finan- cial position and policies of corporations, and we will not at- tempt here to discuss all of these cases and the problems which they present to the investor or trader. One case which we will mention here, however, is that where, a corporation may declare a dividend payable either in stock or cash, making such choice optional with the stockholder, who is advised that unless notification is received by a specified date, the dividend will be paid in cash. Referring again to the case cited where the corporation de- clared a dividend of 300 per cent, it will be recalled that the new stock in this case was valued at $150. per share. Now if this corporation had offered the choice of cash or stock, with the proviso that cash would be paid unless the corporation was notified to the contrary, anyone not specifically advising the corporation that he wished stock and not cash would suffer a considerable loss. He would receive cash amounting to $300.00 instead of three shares of stock with a total value of $450. The importance of carefully reading all dividend announcements will be readily apparent. Errors sometimes occur where brokers have failed to notify 322 WALL STREET a corporation that they preferred stock, and upon receipt of the cash they would credit the account with cash, not knowing that they had the option of receiving cash or stock. Rights and Warrants There are many investors and traders who are not thoroughly familiar with the meaning of the words “Rights” and “War- rants”. A detailed explanation is given below, together with a description of how to use the Warrants, which are evidence of the stockholder’s Rights. Rights When the stockholders of a corporation are offered the op- portunity of subscribing to new stock they are entitled to what is known as a “Right” for each share held. Since the offer to subscribe to new stock is usually made at a lower price than the current market value the Rights obviously have value. A stockholder receives one Right for each share of stock held regardless of the extent of his holdings, his privilege to subscribe to the new stock being determined by the number of shares he holds, and the terms of the stock subscription. The market value of Rights is determined by the current price of the stock already held, and the subscription price at which the new securities are offered. Assume that the stockholders are offered the right to sub- scribe to new stock at $100 per share, in the proportion of one new share for four old shares held, and that the current price of the old stock is 11 2^. The value of the rights may be ar- rived at as follows: Value of 100 shares old stock at $11214 $11,250.00 Giving you 100 Rights, or the privilege to subscribe to 25 shares at $100 2,500.00 $13,750.00 Value of 1 share after distribution of stock dividend. $ 110.00 Subscription price 100.00 Profit on each share subscribed for, or the value of four Rights $ 10.00 323 WALL STREET As you must hold four Rights to subscribe to one new share, which has a value of $10 in excess of the subscription price as explained above, each Right would have a value of $2.50. Warrants Warrants are the actual certificates received from the cor- poration evidencing your privilege to subscribe to the new stock. In the example cited above, your Warrant would show that you are entitled to subscribe to 25 new shares. Many persons receiving these certificates are under the impression that they hold 25 Rights, but as stated previously, they hold 100 Rights, and if the stockholder elected to sell instead of subscribing, he would sell 100 Rights. In many cases corporations offering new shares of stock do not issue fractional shares, and in these cases if the stock- holder is entitled to subscribe to a fractional share, he must either sell the rights representing the fraction, or buy sufficient Rights to enable him to purchase a full share. Referring again to the case previously cited, and assuming that you hold 50 shares of the old stock instead of 100 shares : With the new shares being issued in the proportion of one new share for four old you would receive a warrant entitling you to subscribe to 12^ shares. In this case the one-half share would represent two Rights. You can either sell these two Rights and subscribe to 12 shares, or buy two Rights, which would entitle you to subscribe to 13 shares. When a corporation issues Warrants or Rights to stock- holders it is generally customary for them to send out a letter giving full instructions as to the method of subscription, date of expiration and other details in connection with the issuance of the new stock. In other instances corporations may give stockholders the privilege of subscribing to the securities of an entirely new company, the value of which cannot be arrived at by any definite mathematical process. However, the sponsors of the new security, or interested brokers, will in all probability es- tablish a market. If this market price is lower than the sub- scription price offered by the corporation the Rights are, of course, valueless, but if the market is higher, the Rights have a definite value established by the difference between the sub- scription and the market price. OOI O Li 1 * WALL STREET Each stockholder must definitely decide by considering all the factors in connection with the new stock issue, such as dividends, earnings, etc., and also by consultation with his banker or broker as to whether it is advisable for him to sub- scribe to the stock, or sell his Rights, and action must be taken before the Rights expire. Brokers usually notify their clients when they are entitled to Rights, and at the same time request instructions before the expiration date as to whether clients elect to subscribe or sell. Cases have come to the attention of the writer where sub- scriptions have been made to stocks or bonds, when they could have been purchased lower in the open market. In one case which the writer recalls a large brokerage house subscribed to a stock when the rights were worthless, the price of the stock as quoted in the open market being lower than the sub- scription price. In further illustration we may cite the case which occurred following the severe decline in stock prices in October and November of 1929. In this instance stock- holders had originally been given the right to subscribe to one new share of North American Company stock at $100 for each ten shares held as of October 17, 1929, the subscription falling due on November 15, 1929. However, as a result of the general decline in stock prices during that month the stock of the North American Co. closed at $83 on November 15th, and due to the fact that the stock fell below the offering price the North American Company announced that subscribers would be permitted to withdraw their subscriptions made at the original offering price. In spite of this, however, the list- ing application of the company indicated that stockholders had subscribed to 16,091 shares of stock at $100 per share, thus paying $17.00 per share, or a total of $273,547.00 on the 16,091 shares, more than they needed to through their failure to take advantage of the company’s offer, allowing them to withdraw their subscriptions at the original offering price of $100 per share. Watch the market and other conditions before exercising your right to subscribe. “Ex Rights” means that the value of the rights is deducted from the market price of the stock. 325 WALL STREET Due Bills A “Due Bill” is an instrument of paper, issued and passed between brokers, showing that there is due to the holder cer- tain benefits, such as cash or stock dividends, or rights. This paper is used during the interim between the corporation rec- ord date and the date set by the Stock Exchange, as herein- after explained. The necessity of these “Due Bills” may be brought out clearly by the following example : A corporation announces that it will distribute a stock dividend of 50 per cent to stock- holders of record on July 1st, payable August 1st. The Stock Exchange may rule, for various reasons, that holders of the stock on July 15th and not July 1st are entitled to this stock dividend. According to this ruling of the Exchange, the stock will sell “ex-dividend” on July 15th. This does not affect the records of the corporation, and the stock dividend as originally announced will be distributed to stockholders recorded on the corporation’s books as of July 1st. Now let us assume that your broker was carrying for your account 100 shares of this stock on July 1st. In this event the broker will receive from the corporation on August 1st, 50 shares of stock in payment of the stock dividend. According to the ruling of the Stock Exchange, if you sell your original 100 shares of stock any time prior to July 15th, you are not en- titled to the stock dividend which your broker will receive on August 1st. It is therefore necessary for your broker when delivering these 100 shares against your sale, to attach his “due bill” assigning this stock dividend to the purchaser. In the example just cited, should you have actual posses- sion of these 100 shares of stock on July 1st registered in your own name, you will, of course, receive the stock dividend, when payable on August 1st, but should you sell that 100 shares prior to July 15th, the 50 shares you will receive as a stock dividend belongs to your broker through whom you made the sale as he in turn is responsible to the purchaser. The writer has known of several instances where investors have received additional stock under the above conditions, and being ignorant of the fact that this stock was not their property have sold it, only to learn later that it rightfully belongs to the purchaser of the old stock. 326 WALL STREET In another instance an investor sold through a bank, a stock carrying “due bills.” After the stock had been sold the broker informed the bank that the stock was carrying “due bills” and requested the bank to collect the dividend from its client, the stock being in the client’s name. In the meantime the client received the stock in payment of the dividend, and sold it, thinking it was his property. By the time the bank had notified the client, and corresponded back and forth with the broker, the market had advanced, and in order to adjust the dividend (by buying back the stock) there was a loss of $150. Watch all stocks that you are holding for due bills. Too much stress cannot be laid on the importance of the in- vestors and traders keeping a strict watch over all dividend announcements and any ruling pertaining thereto. There are other forms of “Due Bills” used in the work of a brokerage house, but these are of no particular interest to the investor or trader. Interest Rates One of the most important elements in trading which has great influence on profits is the rate of interest charged by the broker. The interest charge is also of vital importance to the broker as this source of revenue may ordinarily be expected to carry a great portion of his expenses. Since this condition exists, it is reasonable to expect the interest charged customers may occasionally be at a higher rate than conditions warrant, al- though most brokers are very fair in this regard. It is therefore necessary that the trader understand thor- oughly how the interest rate is arrived at, in order that he may intelligently verify this charge. When a customer purchases on margin, the broker must borrow sufficient money at the best rate obtainable to pay in full for the commitment, i.e., the difference between the total cost of the purchase and the money deposited as margin. Interest rates are published daily in the newspapers and are classified as Call Loans, Time Loans and Special Loans. 327 WALL STREET Call Loans A Call Loan is money borrowed on a day to day basis, and derives its name from the fact that it is payable on the call or demand of the loaner. The rate of interest paid for such loans may vary from day to day. Time Loans A “Time Loan’’ is money borrowed for a specific time at a stated rate for the entire period of the loan. Brokers usually borrow a portion of the money that they require, perhaps a third, on time. These loans are usually made for periods vary- ing from one to six months. Special Loans At times a broker is compelled to make special loans at an increased rate of interest on certain classes of stocks and bonds. According to the constitutional laws of the New York Stock Exchange associate brokers are not permitted to charge inter- est at a lower rate than the average actual cost, but are per- mitted to charge a higher rate. While all items are thoroughly checked before statements are sent out, mistakes will sometimes occur and traders should check each item as to the actual figuring of interest. Errors frequently occur in the figuring of interest, sometimes in favor of and sometimes against the trader. Just recently I heard of a case where a trader found an error of $1,000 in his interest account. The larger the account the more chance there is for error. Check your interest items. Short Sales Short selling is the method of speculation whereby a trader expects to obtain a profit through a decline in market prices. In a transaction of this kind he sells something he does not own, with the expectation of buying it back later at a lower price. Granted, of course, that the broker must fulfill his contract, i.e., deliver the stock against the sale and receive payment therefor, this action of short selling places him in one of two positions. 328 WALL STREET Either he must borrow the stock to make delivery, or, if available, use stock that he is carrying for another trader. In either case he will usually make an interest profit and a por- tion of this profit belongs to the trader who sells short, but only on 100 shares or multiples thereof. In borrowing the stock, the broker pays a nominal price and receives interest until the stock is returned. The rate of inter- est depends on the conditions existing at the time, but what- ever it is the trader is entitled to a portion of the interest received. However, there are instances when the borrowing demand is so great that borrowers of the stock are compelled to sacri- fice their interest or sometimes pay a premium. If the stock is “loaning flat,” i. e., bearing no interest or premium, the trader will neither receive nor pay anything, but if the broker is compelled to pay a premium, the trader must pay it in full. However, these are rather exceptional cases, and only occur when a great number of shares have been sold short and there exists a heavy borrowing demand. In selling stock short, you are charged with all Stock divi- dends, Rights, and Cash Dividends, provided you are short when the books close. Traders who are long of stocks that are loaning at a premium may request their broker to loan them and credit their account with a fair portion of the premium thus earned. When traders cause their brokers to loan or borrow stocks, the trader must assume all liability in connection therewith, chiefly in the event of the failure of the broker with whom the borrowing or loaning contracts were made, provided that the trader has received proper notice, or has signed some general consent assuming such liability. Safekeeping Fully paid securities are set aside for clients, and this trans- action is termed in brokerage circles “Safekeeping.” The par- ticular purpose of Safekeeping is to protect clients in event of failure. Should this contingency arise, the securities in safekeeping are the property of the persons indicated in the safekeeping record and cannot be included in the general assets of the bankrupt firm or claimed by the creditors. 329 WALL STREET If a client is trading on margin and the equity in his account is sufficient to allow for full payment of some of his securi- ties, and still leave enough to amply margin his remaining securities, it is advisable that he requests his broker to place these securities in safekeeping for his account. The client, how- ever, should be reasonable in a request of this nature, particu- larly in an active trading account, otherwise the broker will be compelled to make continual entries in and out of the safe- keeping account, as the margin requirements vary in accord- ance with the number of shares carried. I know of many instances where traders have lost consider- able money (when failures have occurred) by not having stock that was fully paid for placed in safekeeping for their account. (See that stock owned by you outright is placed in safekeep- ing.) Questionable Investments Much has been written and said warning the investing pub- lic of the danger and futility of placing their funds and confi- dence, with men or organizations of which they know nothing. In this book I can do no more than reiterate these warnings, with the hope that my readers will investigate thoroughly every proposition submitted to them as an investment. Consult freely with your banker or broker, and if the proposition is not approved of by him, it undoubtedly is not suitable for you. Reputable Brokers One of the most important factors in trading or investing is to deal with a reliable and reputable brokerage house. Members of the New York Stock Exchange are required to answer a questionnaire twice yearly, and this with other safe- guards demanded by the Exchange, gives added protection. It costs no more to deal through a reputable house than through a questionable one, and in fact, much less. The record of the New York Stock Exchange shows a very small percent- age of failures among its members, and where failures have occurred the creditors have suffered comparatively very lit- tle. Of course there are many nationally known investment houses whose reputations are unquestionable and with whom you may deal without hesitation. A reputable brokerage house 330 WALL STREET will always want to know something about the responsibility of a person opening an account, and will demand sufficient margin to protect his clients and himself. Houses that are willing to do business with you on an inadequate margin prob- ably will not give you the protection you require. A few years ago the writer was connected with an organiza- tion that was not a member of the New York Stock Exchange. Shortly after making this connection I learned that the firm which consisted of three partners had started in business two years previous, with a capital of $15,000. In two years time they had opened seven branch offices and had about 2,500 ac- counts which were carrying approximately $2,500,000 of se- curities. Of this amount they were short about $2,000,000 of securities, representing their sales against their clients’ pur- chases. Of course, they failed in time, causing great loss to their clients. Trade or invest with a reputable broker. Callable Bonds When a corporation issues bonds, the identure (the contract) which is deposited with the Trustee, covers various conditions in regard to the paying of this indebtedness. One of the condi- tions that occurs very frequently is, that the issuing corpora- tion will provide that a certain amount of these bonds will be redeemed periodically by drawing a certain proportion, the redemption price usually being higher than the face value of the bond. Let us suppose that a corporation issuing bonds to the extent of $1,000,000 has provided in the indenture for repayment of $100,000 par value at 105, every January 1st, the bonds to be called being determined by a drawing. Assuming the bonds are all of $1,000 denomination, the corporation will draw 100 num- bers and the holders of the bonds having these numbers must return them to the corporation, and will receive $1,050 and interest for every $1,000 bond. A date is usually specified by the corporation for the redemption of these bonds. In addition to the example mentioned, there are various other conditions attached to most bonds, all of which are in- corporated in the indenture. All bond holders should keep a strict and accurate record of the numbers of their bonds, regardless of whether they have 331 WALL STREET actual possession, or whether they are in the hands of a broker or bank, either in safekeeping or in an open margin account. You can demand, and receive, either from your bank or broker the numbers of bonds of this character, regardless of the manner in which they are carrying them for you. Suppose that a brokerage house with inadequate records is carrying bonds for various customers, valued at several hun- dred thousand dollars, on which there is a premium payable to the holders of the numbers drawn. Upon publication of the drawn numbers the broker having several of these drawn bonds in his possession cannot tell to which customer they belong, due probably to a clerical error or through ignorance of the fact that the bonds have a callable privilege. Had the above mentioned house furnished the customers with the numbers of their bonds, both the house and customers would have known exactly what they were entitled to upon the official publication of the list. Another important reason for recording your bond numbers is cited in the following paragraph : A certain public utility bond is selling 30 to 40 points above par, due to its convertible privilege providing for the conver- sion of the bonds into stock. A certain number of these bonds are called periodically by drawings at par. Should you own one of the drawn bonds and were not apprized of this fact in time to convert or sell, you would be com- pelled to accept the face value of $100 for the bond instead of its market value of about $140. A clerk in a New York Stock Exchange house had as one of his duties the watching of bonds that were called, to see if there were any of these bonds in the office. On three different occasions within the period of a year, he failed to present the bonds for collection, thereby causing the firm a loss of about $700. Watch your callable bonds. The following pages illustrate the method corporations use in officially publishing in the financial columns of newspapers lists of called bonds, etc. 332 WALL STREET ENTIRE ISSUE CALLED AT 105% OF PAR VALUE ST. LAWRENCE PAPER MILLS LIMITED To the holders of the Series “A” Twenty- Year 6%% First Mortgage Sinking Fund Cold Bonds of St. LAWRENCE PAPER MILLS, LIMITED NOTICE IS HEREBY GIVEN that pursuant to the provi- sions of the Trust Deed of Hypothec, Mortgage and Pledge made by St. Lawrence Paper Mills, Ltd., in favor of The Royal Trust Company dated April 11th, 1924, . securing the Series “A” Twenty-Year 6^% First Mortgage Sinking Fund Gold Bonds of the Company, all of the said Bonds will be redeemed by the Company on September 1st, 1926, at 105% of the prin- cipal thereof and accrued interest, and holders of the said Bonds are required to surrender the same with all unmatured coupons thereto attached, on September 1st, 1926, at the prin- cipal office of the Bank of Montreal, in Montreal, Toronto or Winnipeg, Canada, or in London, England, or at the Agency of the Bank of Montreal, in the Borough of Manhattan, City of New York, United States of America, for payment and redemption at the said price of 105% and accrued interest to September 1st, 1926. From and after September 1st, 1926, all interest will cease to run on said Bonds. Arrangements have been made for the immediate redemption of such Bonds as may be surrendered for redemption prior to that date, and bondholders who so desire may, at their option, surrender their Bonds with all unmatured coupons thereto attached, at any of the places above mentioned, on any date prior to September 1st, 1926, and will thereupon receive pay- ment of 105% of the principal of such Bonds with accrued interest to date of payment. Montreal, P. Q. June, 1926 By Order of the Board St. Lawrence Paper Mills Limited J. I. RANKIN, Secretary. 3 33 WALL STREET Portion of issue redeemed by drawing at 103% of par value. To the Holders of the Twenty-Year Seven Per Cent. Collateral Trust Gold Bonds of FOLLANSBEE BROTHERS COMPANY NOTICE IS HEREBY GIVEN that as Trustee under the Trust Indenture dated March 1, 1921, of Follansbee Brothers Company, the undersigned will redeem the following numbered Twenty-Year Seven Per Cent. Collateral Trust Gold Bonds of said company, viz. ; 1 420 916 ♦ 1600 2459 2991 4 454 931 1602 2500 3063 12 463 953 1643 2529 3068 28 465 954 1653 2532 3107 29 477 982 1693 2534 3118 58 484 984 1702 2552 3160 65 512 1009 1707 2592 3194 79 531 1014 1718 2594 3224 80 543 1025 1755 2653 3230 94 548 1029 1779 2673 3232 95 566 1057 1800 2703 3297 99 568 1097 1804 2736 3317 101 572 1122 1820 2738 3362 114 580 1218 1864 2740 3367 202 596 1223 1883 2745 3375 232 606 1248 1887 2755 3386 239 661 1279 1889 2765 3402 242 675 1280 1902 2779 3423 264 677 1281 1990 2782 3432 265 683 1310 2000 2800 3454 307 702 1336 2003 2811 3485 313 704 1348 2042 2817 3489 347 715 1363 2048 2850 3540 358 728 1411 2070 2861 3568 374 746 1437 2087 2922 3601 375 804 1492 2165 2925 3691 393 808 1507 2172 2930 3710 394 823 1534 2280 2941 3715 397 825 1539 2401 2950 3735 398 833 1555 2424 2974 3894 402 839 1567 2434 2975 3975 418 861 1587 2446 334 WALL STREET on Sept. 1, 1926, at the Corporate Trust Department of the undersigned, No. 10 Wall Street, Borough of Manhattan, City of New York, by paying to the bearer or registered holder of each such bond the par value thereof, together with a premium of 3 per cent (3%) of such par value, upon the surrender there- of, respectively, with all coupons for interest thereon not due at the date of redemption. Registered bonds surrendered must be properly endorsed for transfer. From and after September 1, 1926, interest on the bonds so designated for redemption shall cease and all coupons for interest maturing after said date shall become and be null and void. Coupons due on that date should be detached and put through the usual channels for payment. BANKERS TRUST COMPANY, As Trustee. Dated June 23, 1926. By H. F. Wilson, Jr., Vice-President. Tenders requested at price not exceeding 105% of par value. To the Holders of Twenty-five- Year Six Per Cent. Secured Sinking Fund Gold Bonds of COMMONWEALTH POWER CORPORATION Pursuant to the provisions of the Trust Indenture, dated May 15, 1922, of Commonwealth Power Corporation, tender to the undersigned as Trustee is hereby invited of Twenty-five- Year Six Per Cent. Secured Gold Bonds outstanding there- under, for sale for the purposes specified in Section 2 of Article VII. Proposals to sell bonds must be presented in writing to the undersigned at its Corporate Trust Department in its office at Number 10 Wall Street, New York City, not later than 3 o’clock P. M. on July 21, 1926. To the extent of funds in the hands of the undersigned amounting to Six Hundred and Six- teen thousand, two hundred thirty-three dollars and ten cents ($616,233.10), bonds so offered will be purchased at the lowest prices asked therefor not in excess of One hundred five per cent. (105%) of the principal amount thereof and accrued interest on such principal amount to the date of purchase. Should there be two or more proposals at the same prices aggregating more than the available fund after acceptance of all proposals at the lowest prices, such proposals under their terms will be accepted pro rata. 335 WALL STREET The undersigned reserves the right in its discretion to reject any or all proposals, in whole or in part if it can, at the time of opening such proposals, purchase the requisite amount of such bonds or any part thereof at a price lower than the lowest price offered by said proposals. Dated July 7, 1926. BANKERS TRUST COMPANY, By II. F. Wilson, Jr., Vice-President. In the above instance issuing company has $616,233.10 avail- able for purchase of bonds. Bond Interest All bonds, except those noted hereinafter, are bought or sold with accrued interest, meaning that in addition to the price, interest is also added at the rate of the bond, from its last payment date to the date of clearance of purchase or sale. Take for example, a 6% bond, interest payable June 1st and December 1st. Its cost if purchased on January 9th, clear- ing January 10th, would include interest for one month and nine days. The purchaser’s bill would read as follows: January 9th, $1,000 — 6% Bond at 95 $950.00 Interest from Dec. 1st, 1 month 9 days 6.50 Commission 2.00 $958.50 For the purpose of figuring bond interest, except in a few isolated cases, each month has 30 days. Bonds not carrying accrued interest are as follows: Income Bonds, Adjustment Bonds, defaulted bonds, and bonds on which interest is paid in foreign currency, with no fixed rate of exchange, etc. The price of such bonds usually takes into consideration the different factors, regarding interest pay- ments. They are said to be selling “flat,” i.e., no interest. Most bonds pay their interest in the form of coupons which are attached to the bond itself. These coupons should be de- tached on the interest dates noted on the coupon, and presented to your bank or broker for collection. Some bonds, however, are registerable as to interest in which case all coupons are 336 WALL STREET detached by the company, who registers the interest in the name of the holder, and a check is sent to him when due. When buying bonds wdiich are registered as to interest, it is very im- portant to have the bonds re-registered in your own name. When your bonds are in a broker’s custody it is part of his service automatically to credit your account with the interest when due. Puts and Calls A Put or Call is an option allowing the holder to buy or sell securities at a stated price within a stated period of time. For the privilege he pays a certain sum, depending on the price of the security, market conditions, length of contract, charac- ter of security and the number of shares of stock involved. For example, let us assume that a stock is selling at 120, and I am of the opinion that it will sell considerably higher within the next 30 days. Not choosing to take the risk of purchasing 100 shares, and depositing about $2,500 as margin, I decide to buy an option which is termed a Call. Acting on my instruc- tions the broker buys a 30-day Call on 100 shares at 124. The Call costs me $125. Now let us study this situation. My total investment is $125 representing 1*4 points on 100 shares of stock, and my possible loss is confined to this amount. My buying price being 124, and considering 1% points paid for the option and X A% for commissions and stamps, it is obvious that the stock must ad- vance to 125% before my option becomes profitable. My judg- ment is correct and the stock reaches 132% during the thirty- day life of the option, and I sell 100 shares at 132% and exer- cise my Call at 124. I make a profit of 7 points net or $700. The reader may ask why, in view of the fact that I believed the stock was going to advance, I did not purchase actual stock at 120 and make a larger profit. It will be noted that the stock might have receded 10 points, in which case I would have lost $1,000, whereas in buying the Call I would lose no more than my original $125 investment. A part of the original investment may, of course, be saved if the Call is exercised at any point between 124% and 125%. A Put is just the reverse of a Call. With the market at 120, you buy a Put at 116, that is the option of selling or delivering stock at this price within thirty 337 WALL STREET days. If the market receded below that point, say to 110, you would exercise your Put at 116 and buy 100 shares at 110 thereby making a profit of 6 points, less the cost of the Put and commissions. If the stock remains above 116 you would allow the Put to expire, and lose your original investment. If during the life of a Put or Call, the stock sells ex-dividend the price is reduced by the amount of the dividend. In the case of the Call mentioned your option to buy would be re- duced from 124 to 122% and the Put price would be reduced from 116 to 114% assuming that the dividend was 1%%. It must not be understood from these remarks that I favor trading in Puts or Calls rather than the actual purchase or sale of securities as this form of trading is largely speculative. I want to bring out all points, and the decision as to the better way of trading must rest with yourself. Your own require- ments as to finances, the necessity for limiting losses and other conditions must help you to arrive at a decision. Margin and Stop Loss Orders Margin, in Wall Street, -represents the amount of money de- posited with a broker to protect a customer’s commitments, either on the long or short side of the market. The margin re- quirements depend on the conservatism of the broker, charac- ter and price of the security, and general market conditions. The margin deposited with your broker assists him to finance your operations, and gives him the protection required in the fluctuations of the market. As the broker requires ample protection at all times, it there- fore follows that if your margin is diminished through market fluctuations or otherwise, he will call on you for additional funds to adequately protect your account and himself. This is termed a “Margin Call.” In the event that you do not respond to the broker’s “mar- gin call” either by depositing cash, or acceptable collateral, he may, if the market continues to act against you, place a “Stop Loss Order” on your account, usually at a point near the exhaustion of your margin. The broker, as a matter of course, will notify you as soon as possible upon placing “Stop Loss Orders” in your account. 338 WALL STREET Brokers usually make every effort to notify customers of the condition of their accounts and give them reasonable time to respond to calls for margin. However, in case of severe market fluctuations, or the inaccessibility of the customer, it is some- times necessary for the broker’s protection, to liquidate the account without notice to the customer. Orders The rapidity with which orders are necessarily handled and the many different interpretations which may be placed upon them make it absolutely imperative that clients place their orders in such a way as to preclude any doubt of their intentions. There are two distinct classes of orders, “GOOD FOR THE DAY” and “GOOD UNTIL CANCELLED”, the latter fre- quently called “OPEN ORDERS”. Either one of these classi- fications should always be mentioned in placing an order. An acquaintance gave an order to buy 100 shares of a stock at 120. As the stock did not reach the price that day, his order was automatically cancelled. The stock next day sold at 1191^ and then went up to 123. Not receiving any report, the following day he called up his broker and asked him why he had not received a report, and the broker informed him that he had not mentioned in placing his order that it was to be “good until cancelled” and his order had been cancelled at the end of the day. By this time the stock was selling at 125 which caused a loss of $500. Buy or Sell at the Market Orders given in this manner are to be executed at the lowest prevailing offer when buying and at the highest prevailing bid when selling. Limited Orders An order to buy or sell at a stated price is what is termed a “Limited order.” These orders are usually placed at a price lower or higher than the prevailing market price and are not executed until the market reaches the price stated. 339 WALL STREET Stop Orders These oi'ders are usually given G. T. C. (good until can- celled) with the idea of limiting losses or conserving profits to a definite amount. A trader buying stock at 125 may place an order to sell at 123 stop, thereby limiting his losses to approxi- mately 2 points. Or, if the market advances to 130, he may place an order to sell at 128 stop, thereby assuring himself of an approximate profit of 3 points. A trader selling short at 125 may place an order to buy at 127 stop, to limit his losses to approximately 2 points. Or, if the market recedes to 120, he may place an order to buy at 122 stop, thereby assuring himself of an approximate profit of 3 points. A Stop Loss Order immediately becomes a market order after a sale is made at the given price. Clients should keep a record of G. T. C. orders to prevent duplications. When it is desirable to change the price of an order be sure to cancel any previous instructions covering the same order; otherwise both may be executed. Limited orders to buy are reduced by the amount of dividend declared by a corporation on the day the books close, which is the day the stocks sells “ex-dividend.” Therefore, an order to buy 100 shares of stock at 125 would be reduced to 1231/2 assuming the dividend to be 1% points. Limited orders to sell are not reduced, the price remaining the same over the dividend period. Some houses reduce stop orders to buy or sell without in- structions but as there is no universal custom covering this action the client should be guided by the practices of the broker with whom he is dealing. These statements regarding prices at which orders may be executed refer particularly to orders of 100 shares or multiples thereof. Odd Lots On the New York Stock Exchange odd lots (that is, lots of less than 100 shares) are subject to the commissions of odd lot dealers, and the broker who handles “odd lots” is called the “Dealer.” 340 WALL STREET An odd lot order at a stated price is not executed until the dealer’s commission is allowed for. Therefore, an order to buy 10 shares of an active stock at 79 would not be executed until actual sales took place at 78%. An order to sell 10 shares of the same stock at 79 would not be executed until actual sales took place at 79%. An order to buy or sell 10 shares at the market usually would not be executed until a sale of 100 shares or more actually oc- curs. If this sale was at 79, the buyer would pay 79% and the seller would receive 78%. Limited odd lots are also subject to other conditions. For instance, let us assume that the last sale of a 100 share lot was 46. An order is entered to buy 10 shares at 45. Now, if the stock next sold at 44 the order would be executed at 44%, the buyer receiving the advantage of the 44 sale. On the other hand, if the next sale from 46 was 45 or over and then dropped to 44 the order would be executed at the limit price of 45. Odd lot orders at the market if entered with instructions to buy at the offer or sell at the bid price, are executed immedi- ately without waiting for a sale of 100 shares or more. The odd lot dealer, however, is not compelled to trade on a bid or offer, but will usually do so. The odd lot dealer’s commission varies according to the price and activity of the stock, but the usual charge is % to %%. Discretionary Accounts Some traders who feel that they have not sufficient time to attend to the placing of orders and watching the market, em- power another person to buy and sell stock for their account. This is termed a discretionary account. Frankly, this is a dangerous policy, and at times results in serious loss, with absolutely no redress for the trader giving an account of this kind. Fortunately, reputable houses will not accept discretionary accounts, unless some very unusual circumstances require them to do so. They realize the temptation offered to the man han- dling a discretionary account. Do your own trading. 341 WALL STREET Unlisted Securities While many large corporations list their securities on an exchange, there are a great number of issues which are not listed and which are not traded in at any definite place. In Wall Street, dealings in the unlisted securities are known as “Over-the-counter” trades. The markets in Over-the-counter securities are handled by various dealers who make their bids and offers either to other brokers or individuals, according to the orders on their books, allowing themselves a profit over or under the order price. For illustration, take an inactive security, such as Pacific Fire Insurance. If you gave your broker an order to buy 100 shares of this stock, he would canvass the dealers who spe- cialize in Insurance Stocks, and obtain their quotations before executing your order. Due to the nature of unlisted trading, the dealer’s quotations sometimes vary and therefore it is im- portant that your broker thoroughly canvass the market. Outright or Cash Purchases Many investors and traders purchase securities and pay for them in full. This, of course, is the ideal way of investing, but there are comparatively few traders who do this, as their buy- ing power is limited to too great an extent. Purchases made in this manner are known as “outright” of “cash transactions.” In “cash purchases” the title to, and actual possession of certificates are vested in the buyer, while in marginal transac- tions title and certificates remain with the broker. When buy- ing a stock outright the broker should be given instructions to have the certificates registered in the name of the owner, for which there is no additional charge. This assures the owner of the receipt of all dividends, and rights, as well as the cor- poration’s annual statements, literature, etc., which will enable him to keep in close touch with the activities of the corpora- tion. It will safeguard the stockholder against an experience similar to that of Mr. Blank ’s, as follows : Mr. Blank bought 100 shares of American Telephone & Tele- graph Co. On the eve of an extended business trip he hurriedly visited his brokers, paying in full for his purchase, and received the stock in the name of an individual properly guaranteed as to signature. Upon his return he discovered that he had not 342 WALL STREET received the dividends on his American Telephone & Telegraph stock for a year and a half. He immediately requested his brokers to collect these dividends from the party in whose name the stock was registered. The brokers finally learned that the former owner of the stock had received the dividends but could not be located. Mr. Blank’s actual loss was $1,350 plus time and annoyance. Bonds, when bought outright, should be accepted from the broker in “bearer” form with coupon attached, for the period- ical interest payments, unless registered bonds are desired. While bonds registered in the owner’s name may be to some degree safe from loss or theft, the particular disadvantage of registered bonds is that they do not usually command the same market price as coupon bonds, and the process of converting registered into coupon bonds sometimes causes considerable delay. Cash customers should make prompt payment on receipt of bills from their brokers. If payment is delayed, the broker may add interest for the unpaid period. As a matter of fact, the Stock Exchange requires brokers to charge this interest unless there is a reasonable excuse for non-payment or the amount of such charge is less than one dollar. Those owning securities outright should pay attention to their physical care, a safe deposit box being the best place for them. A detailed list in duplicate giving cost, numbers and other details should be kept. A very good practice is to keep the original list with the securities and a duplicate in some readily accessible place. It is particularly important to keep a record of bond numbers as some bonds have unusual features which are mentioned in the chapter entitled “CALLABLE BONDS.” Tipsters There are various organizations throughout the country, who pretend in their publications to have so-called “Inside Infor- mation” regarding stocks of certain corporations, and to pre- dict with certainty their trend in the market. These may prac- tically be considered as worthless as their observations are not based on facts or information but are largely guesswork. Their advice should be strictly avoided. These “tipsters,” however, must not be confused with the many worthy statistical bureaus, whose business it is to supply 343 WALL STREET accurate and trustworthy information upon which may be based accurate opinions as to the merit of various corporations. Federal Income Tax Profits or losses accruing from the purchase or sale of secur- ities must be included in the income tax report. The income tax law covering individuals does not consider that a loss or profit is established on a security until the trans- action is closed. That is to say, a person owning stock that has depreciated in value cannot deduct this loss until the stock is actually sold. However, should a trader desire to establish this paper loss he may do so by actually selling the security during the income tax period covered by the return and repur- chasing it at a later date. This repurchase cannot be made, however, until thirty days after the date of sale. During this thirty-day period the security may advance considerably in market price causing the repurchase to be made at a higher level and it is suggested that you consult your broker who will be glad to advise you how to establish this loss with a minimum risk and to your best advantage. Securities showing a paper profit as stated above, are not to be included in your return and it is sometimes desirable to de- fer taking this profit until after the taxable period, if it is desired to keep one’s income under certain limits. Commission and Taxes Commission rates on stocks are as follows : New York Stock Exchange Stocks. Under 50c per share may be mutually agreed upon, 50e per share but under $1.00, not less than 3c per share. Per Share $ 1 per share and above but under $ 10 not less than 7%c 10 per share and above but under 25 not less than 12^0 25 per share and above but under 50 not less than 15e 50 per share and above but under 75 not less than 17^0 75 per share and above but under 100 not less than 20c 100 per share and above but under 200 not less than 25c 200 and over not less than 30e per share plus 5c per share for each $50 or fraction thereof beginning at $250. 344 WALL STREET The minimum commission on stock selling at 50c and above on an individual transaction shall not be less than $1.00. This provision shall not apply on transactions where the amount involved is less than $15.00. On Bonds and Notes of foreign countries, having five years or less to run, notes of corporations having five years or less to run, and bonds of corporations having five years or less to run, such rates as may be mutually agreed upon, unless special rates are determined upon by the Committee on Quotations and Commissions. Note, said committee has determined that on said bonds or notes that are selling below 90 or above 110, the rates specified for bonds generally shall apply. New York Curb Market Stocks— Selling under 50c, 3% of amount involved Selling at 50c and under $1 — 2c per share Selling at $1.00 and under $5 — 5c per share Selling at $5.00 and under $10— 7%c per share Selling at $10.00 and under $25— 12 1 /^c per share Selling at $25.00 and under $50 — 15c per share Selling at $50.00 and under $75 — ll 1 /^ per share Selling at $75.00 and under $100 — 20c per share Selling at $100.00 and under $200 — 25c per share Selling at $200.00 and over, 25c for first $200 and 5c additional for each $50 or fraction thereon. Minimum commission shall not be less than $1 on an indi- vidual transaction \mless amount involved is less than $15.00. Bonds All Bonds or Notes having more than five years to run, per $1,000 par value, the commission shall be $2.00. Commission shall be charged on rights in accordance with commission rates, now governing minimum commission rates on stocks. Taxes According to the laws of the United States Government and New York State, it is necessary that a seller of securities pay a tax. The various transfer offices cannot transfer stocks from 346 WALL STREET one name to another, unless stamps representing these taxes are affixed to bill of sale. The rates established are as follows : On stock with par value, 2c Federal Tax, and 2c New York Tax (per $100 par value). For instance, on a sale of 100 shares of United States Steel (par value $100) the seller must pay a tax of $4.00, representing $2.00 Federal and $2.00 New York State. On a sale of 100 shares of Pennsylvania Railroad (par value $50.00) a seller must pay a tax of $2.00, representing $1.00 Federal and $1.00 New York State. On sales of Stocks of no par value, taxes are charged at the rate of 2c Federal and 2c New York State per share, regardless of selling price. Thus the seller of 100 shares of stock having no par value will be taxed $4.00 divided evenly between the Federal Gov- ernment and New York State. At this writing the States of Pennsylvania and Massachusetts have also passed stock transfer laws, and a seller of securities, the transfer office of which is located in either of these states, must pay an additional tax to conform to the laws of these two states, which are the same as those in effect in the State of New York. Subscription Rights Per Right Under 50e per right may be mutually agreed upon 50c per right and above, but under $1.00 not less than. . 3c $ 1.00 per right and above, but under $ 5.00 not less than 5e 5.00 per right and above, but under 10.00 not less than 7^c 10.00 per right and above, not less than. 15c Bonds On Bonds, except those stated below, not less than $2.00 per $1,000 par value. On securities of the United States, Porto Rico and Philippine Islands and of States, Territories and Municipalities therein, such rates as may be mutually agreed upon, unless special rates are determined on by the Committee on Quotations and Com- missions. 346 Terms and Definitions TEEMS AND DEFINITIONS A A. To designate a certain class of stock, such as “A” com- mon, “A” preferred, or Series “A” bonds, etc. Accrued Bond Interest. The amount of interest due to the seller of an interest bearing bond, except income bonds or bonds selling flat, covering the period between the last interest payment date and the clearance date of sale. If this interest were not included the seller would lose the interest to which he is fully entitled. Assuming that the bond in question paid interest by coupon on February 1st and August 1st a sale made to clear on May 10th would bear interest from February 1st to May 10th (3 months and 9 days) at the rate specified in the bond, in addition to the stated sales price. The buyer of the bond would not lose the interest as on August 1st he would receive a full six months interest although he held the bond for only 2 months and 21 days. Accrued Dividend — The same as accrued bond interest but relating to stocks only. Used principally in selling guaranteed stocks or in connection with the offering of new issues of established companies where the dividend is fixed and assured. Arbitrage. Taking advantage of different prices for the same securities, in differently located markets. These differ- ences may result from the actual condition of the market itself at various points, money exchange rates, interest for the time that securities might be in transit, etc. These conditions must be taken into consideration by the person attempting to make the arbitrage. The method is to buy security at a certain price in one market and sell it at a higher price in another market or the method may be reversed by making the sale first. After deducting certain expenses the difference represents the profit or sometimes the loss on the transaction. An arbitrage may also be made by trading in rights to 349 WALL STREET subscribe, at a differential in value between the cost of the rights, the subscription price and the market value of the stock subscribed for. Arbitraging may also be operated profitably in cases of mergers or reorganizations involving the issuance of new securities. Assessable Stocks. Those securities which are issued in such a manner, either through the regulations imposed by the state laws in which the company is chartered, or the charter itself, that the owners of such stock may be subject to an assessment. These assessments may result from the need of additional capital to continue operations, proof of fraud in originally issu- ing fully paid stock, or because of other contingencies resulting in the need for additional funds. The assessments must be paid at the proper time otherwise the owner of the shares is faced with the possibility of loss of his entire investment. The in- vestor should use extreme caution in purchasing assessable securities as he may be confronted with considerable loss in the event of some unlooked for condition arising. The best known assessable stocks are shares of National Banks carrying double liability for the owners thereof. There- fore in selling a stock of this kind the practice to be followed should be that of transferring the security to the name of the purchaser, rather than endorsing the certificate in blank. Assign in Blank. Signing a security without inserting the name of the party to whom the stock is to be transferred. At Opening. An order with no price limit, to be executed immediately at the opening of the market, at the best price obtainable. Averaging. This term is used where a trader, having pre- viously bought stock at a higher price than the present market, buys additional shares of the same stock at a lower price. For example, Mr. X buys 100 shares of General Asphalt at 80. This stock goes down to 70. He then buys 100 shares at 70, making him long of 200 shares at an average price of 75. Now if the market went back to 80, he would make 5 points on 200 shares instead of merely breaking even. The same principal would apply to securities sold short the trader selling addi- tional stock at higher prices to obtain a better average price for the entire lot. 350 WALL STREET B Bad Delivery. Any delivery of a security which does not conform to the “Rules for Delivery” as fully detailed in the Chapter devoted to the cage and cashier. Balancing Statement. Bringing the debit and credit side of the statement into agreement by placing the balance, or differ- ence, on the proper side. After arriving at this figure the bal- ance is brought down below the addition and ruled lines to- gether with a list of the securities long and short. Bank Loan— Money borrowed from a bank against the de- posit of acceptable collateral which should exceed the amount of the loan by from 25 per cent to 40 per cent according to provisions made when the loan is negotiated. Bear. “Bears” are those who sell short, expecting the gen- eral market or a particular stock to decline to lower prices. Bearer Form. Any security or instrument issued to bearer instead of a certain person. Delivery may be made from hand to hand without endorsement. Coupon bonds, due bills, bearer stock certificates, and at times fractional shares and rights are issued in this manner. Bid and Offer. A bid is the best price obtainable for a cei’- tain stock or security. An offer is the lowest price for which it can be bought. Thus a stock is quoted 143 bid offered at 143^. The method of making bids and offers on the New York Stock Exchange are regulated by rules established by the governing committee. The term offer is synonymous with “asked,” the latter being more generally used. Big Board. The term is usually applied to the New York Stock Exchange to distinguish it from the New York Curb Market or the securities department of the New York Produce Exchange. Blotters. This is the general term used for all record sheets used in the Clearing House, Purchase and Sales, and Cashiers Departments and are similar in use to the Day Book employed by commercial firms. The various blotters of a brokerage firm show in detail every transaction affecting customers accounts. 351 WALL STREET Board Room. Sometimes called the customers’ room in brok- erage houses. In this room is located all the equipment neces- sary for the transmissions of orders to the various markets, news sheets, quotations board, news and stock tickers, and all other facilities for keeping the customers in close touch with conditions and markets. The term is also used to designate the trading room of an exchange. Bonds. A negotiable instrument issued by a Corporation, Government, State or Municipality contracting to pay a speci- fied amount of money, at a specified time and at a specified rate of interest. There are many classes of bonds such as a first Mortgage, general mortgage, second mortgage, first and second liens, in- come, collateral trust, convertible, debenture sinking fund, etc. They are usually issued to bearer having coupons attached for the periodic interest payments, although many are issued in registered form. Issuers of bonds sometimes retain the privilege of redeeming them at an earlier date than maturity but all conditions are fully covered in the indenture which is deposited with the trustee. Books Close. The transfer books of large Corporations are usually closed at certain periods to allow for payment of a declared dividend. This is done so that there will be no change in the list of stockholders during the time the dividend checks are being prepared. Notice of such closing are usually published considerably in advance, thus giving brokers, banks, stockholders, etc. ample opportunity to have their names properly registered on the transfer books. Corporations however may close their books for other reasons than for payment of dividend. The term “books-elose” is at times used synonymously with Ex-Dividend, to which refer. Box. The Box is a metal receptacle, or a number of them, for keeping all securities that are actually in the office during the day. At the close of business these boxes are taken to a safe deposit vault remaining there until they are required the following morning. 352 WALL STREET Box Count. An actual count of the securities in the box, either in connection with an audit or with periodical checking. In the latter case the securities in the box should agree with the box book, a record kept from day to day. Brokers Transfer Account — An account kept by the transfer clerk giving details of securities transferred for the account of other brokers. Occasion for this arises when delivery is made by transfer instead of by delivery of the actual certificates and at times to expedite delivery as in the following instance. Blank & Co. owe Jay & Co. 50 shares of Kennecott Copper, but have a certificate for 100 shares. Jay & Co. being unable to give 50 shares in return accept the 100 shares and transfer 50 shares to their own name and 50 shares to Blank & Co. The 50 shares transferred to Blank & Co. are placed in the brokers transfer account and delivered to them when received from the transfer office. Bucket Shops. An apparently legitimate brokerage house, usually not members of any Exchange. Such concerns will present an excellent front, meaning an appearance of prosper- ity and full equipment such as tickers quotations board, etc. Orders to buy or sell placed with such a concern are not actually executed although the client will be charged interest, commission and taxes. The owners of the bucket shop will take the opposite side of any transaction, for instance, if a customer buys 10 shares of stock in anticipation of a rise the bucket shop owner will be short of the stock. If the client wins, the bucketeer loses. Even though a client makes money on this transaction it is sometimes difficult to collect as the bucket shop by using high pressure method will induce the customer to continually pur- chase more stocks and if this continues long enough a sudden reaction in the market usually results in the client being closed out for lack of sufficient margin. All exchanges are making every effort to eliminate these concerns. The New York Stock Exchange has ruled as follows : “RESOLVED, That any member of this exchange who is interested in, or associated in business with, or whose office is connected, directly or indirectly, by public or private wire or other method or contrivance with, or who transacts any 353 WALL STREET business directly or indirectly with or for, any organization, firm or individual engaged in the business of dealing in differ- ences or quotations (commonly called a bucket shop) shall, on conviction thereof, be deemed to have committed an act or acts detrimental to the interest and welfare of this exchange.” Bulls. “Bulls” are those who buy, expecting the general market or a particular stock to advance in price. Buy In. There are often cases where a broker will have securities coming to him from another broker on account of the latter having failed to deliver them. The broker, wanting these securities, files with the Stock Exchange, a notice, termed a “Buy In.” A copy of this is served on the broker owing the securities. The broker owing the stock has until 2 :15 P. M. that day to deliver, and unless he makes delivery the Stock will be bought in for cash for the broker who is to receive the se- curities. The difference in price between the “Buy In” and the price that the securities were originally sold for, is adjusted by a check from one broker to the other. C Cage. That part of a brokerage office in which is located, the cashier, stock clerk, loan clerk, transfer clerk, blotter clerk and others having as a part of their duties the receiving and delivering of securities. The cage is exactly what its name implies being made of wire or steel partitions. No one except members of the firm, the manager and employees of the cashiers department are allowed access on account of the valuable securities which are at all times handled in this department. Callable Bonds. Bonds of any kind in the issuance of which the borrowing corporation, government, municipality or state have reserved the right to redeem the bonds prior to their maturity date. Various conditions surround this callable privilege, such as calling in whole or in part, at certain prices at certain periods, with or without premium, etc. In the event of calling only a part of the issue it is usually accomplished by drawing the numbers of the certificates which are advertised publicly. Call Loan. A loan which has no definite maturity or rate of interest. The loan may be called by the lender or paid off by 354 WALL STREET the borrower at any time. The rate of interest is fixed by the renewal rate of call money announced daily at about 11 A. M. and is thus subject to daily changes. Call (Put). A call, used in this particular sense, is a written agreement, allowing the holder thereof to demand from the signer delivery of a stated number of shares of a particular stock at an agreed price within a stipulated time limit. A put is the opposite of a call allowing the holder thereof to make delivery and receive payment for stocks under the same con- ditions as noted in the call. Calls and puts are usually signed by a reputable firm, but if signed by an individual a satisfac- tory endorser is required. These privileges, as they are some- times called are mainly used as a hedge or offset to market speculation or to allow speculation in a comparatively large amount of stock at a small outlay, with losses limited to the original investment. Carrying. A client is said to be “carrying” a security when he is long of the security. Usually applied to margin purchases. A further use of the word is in the case of one or more per- sons carrying securities for some one without protection or collateral of any kind. This is usually a temporary accommo- dation, perhaps for a few days. The word is used freely in financial circles with different shades of meaning but the above is indicative of its general use. Carrying Charges. Whenever a broker charges more than six per cent interest on a customer’s debit balance, the interest over six per cent is called “Carrying Charges.” For illustra- tion, if a broker were charging a customer 8 per cent, the state- ment would read, Interest @ 6 per cent and 2 per cent Car- rying Charges. Carrying Due Bills. When a Security is carrying due bills a form entitling the holder to certain rights, such as stock divi- dends, rights to subscribe, securities resulting from mergers or reorganizations, etc. is attached to the certificate. The due bill is used during the period between the ex-dividend date de- clared by the issuing corporation and the ex-dividend date announced by the Exchange. Cash Accounts. In a cash account all stocks and bonds that are purchased are paid for in full. After the securities are paid 355 WALL STREET for, they are usually transferred to the client’s name and delivered to him or held subject to his instructions. Cash Trades. Securities bought or sold for immediate de- livery or before expiration of the usual time limit for deliveries usually 2 :15 P. M. of the day the trade is made. Securities bought or sold in the regular and not for cash way, cannot be delivered before the next following full business day. Central Clearing Department. A department of the Stock Clearing Corporation wherein securities are received for and delivered to clearing members and clearing banks. This elimi- nates the waste of time and risk involved in delivering securi- ties from one house to another. All securities balances from the Night Clearing Branch are made through the Central Delivery Department, the delivering broker being credited with the proceeds and the receiving broker being debited. In addition to the Night Clearing balances, securities to be delivered to or received from certain banks are put through the Central Delivery Department. A partial list of such banks will be found in the chapter covering Clearing House deliveries. Cash settlement in one check is made at the end of the day for all items going through the Central Delivery Department and the Day Clearing Branch. Checking Position. The Stock Record, Bookkeeping, and Margin departments each keep a record of the positions of all customers. Should there be any question of the accuracy of the position of a customer’s account, as recorded in one depart- ment, it may be checked with the other two departments. Clearance Business. Many firms make a specialty of clear- ing transactions for other brokers. These brokers may be members of the same exchange, out of town members, or non- member firms. The commission charged for clearing depends on the price of the security, and the status of these brokers, as members obtain a special rate whereas non-members must pay full commissions. Furthermore a different rate of com- mission will be charged if the securities are carried over night or for a longer period. The term clearance is used when one broker receives securities for the account of another broker, pays for them and makes delivery if the securities have been sold. 356 WALL STREET Z Clearance Date. The date on which a security is received or delivered through a previous purchase or sale. For instance a purchase is made on Thursday, Feb. 7th. This is the date of trade. The clearance date is the next following full business day, in this case, Feb. 8th. If Feb. 7th were a Friday, the clearance date would be Feb. 10th as no deliveries are made on Saturday. Intervening holidays are treated in the same manner. The above applies only to transactions made in the regular way. “When issued” trades, cash trades, sellers and buyers option, delayed delivery, etc. are subject to the pro- visions made at the time of the trade. Clearing House. For the purpose of this book the term gen- erally applied to the Clearing Houses of the New York Stock Exchange and the New York Curb Market. The Clearing House was established for the particular purpose of expedit- ing and eliminating individual delivery of securities and to minimize the cash outlay of clearing members. A few examples will illustrate clearing transactions. Jones & Co. purchase 5000 shares of Anaconda from ten different brokers and sell 4000 shares to six different brokers. Without the facilities of the Clearing House Jones & Co. must accept ten different deliver- ies and pay out a sum approximating, at the market, $350,000. Jones & Co. must then deliver 4000 shai*es to six different brokers and receive payment. Using the Clearing House Jones & Co. would receive only 1000 shares at a cash outlay of only $70,000 and would make no deliveries whatso- ever. The system could be used to a further extent by Jones & Co. loaning 1000 shares which would go through the Clearing House. This would even up his position for the day and no stock would be received or delivered. The cash outlay men- tioned previously would of course be temporary as Jones & Co. would be reimbursed for about 80 per cent of the net debit by arranging for a bank loan. However it might be inconvenient to finance $350,000 even temporarily. The clearing is accomplished by each clearing member send- ing a sheet to the Clearing House on which is listed all pur- chases and sales of 100 share lots of stock which are on the Clearing List. The Clearing House then pairs off purchases against sales and adjusts the differences in cash by a payment to or from the clearing member. 357 WALL STREET Clearance House Balance— All purchases and sales entered on the Clearing House sheets are checked against each other, leaving balances of different stocks to receive and deliver. The names of the brokers from whom securities are to be received and delivered to are supplied by the Clearing House. The term is also used to designate the amount of money to be received or paid to the Clearing House when delivering the night sheet, said differences resulting from the actual prices and the Clearing Houses prices. Further use of the term is in connection with the day-clear- ing branch of the Clearing House. The daily settlement check is also called a Clearing House balance. Clearing House Draft or Check— The differences to be re- ceived or paid to the Clearing House when delivering the Clear- ing House Sheet. Money received is called a draft, money paid out is called a check. A draft or check represents the difference between the debit and credit side of the sheet, or the purchases and sales, after the balance to receive and the balance to deliver have been added to the sheet at the Clearing House prices. Clearing House Prices. At the time the last quotations are printed on the tape the Clearing House establishes prices for all active clearing stocks. These are termed Clearing House prices and are at the nearest full figures of the last sale. Assuming that Anaconda closed at TO 1 /^ the Clearing House price would be 70. These prices are used in making up the Clearing House security balances on the sheet delivered to the clearing house at night. Clearing House Stocks. Stocks in 100 share lots or multi- ples thereof which have been entered on the Clearing List. Inactive stocks are not usually eligible for clearance. Clearing House Tickets. Evidence of purchase and sale on special forms made up by the Clearing House. These tickets are exchanged through the Clearing House excepting in case of disputed trades in which event they are exchanged by hand, that is, from house to house. These are called ‘demands.’ Closed Out. This means that the client’s account no longer has any securities long or short, nor any money balance. 358 WALL STREET The act of selling or covering securities as particularly ap- plied to forced transactions on account of insufficient margin. Closed Trade. When the same number of shares of a par- ticular stock have been purchased and sold it is termed a closed trade. In other words an even position in any stated security. Collection of Coupons. Detaching the interest payment cou- pons from bonds or coupons representing dividends on bearer stock. The coupons are deposited with the bank in specially printed envelopes, the bank collecting the amount due from the agent of the Corporation, municipality, government or state. Some bond coupons must be accompanied by income tax ownership certificates. Commission Bills. Bills rendered to one broker from an- other stating the amount due for orders executed. They are usually sent out at the end of the month. Commodities. Trading in wheat, corn, cotton, sugar, coffee, oats, etc. is said to be dealing in commodities. Comparisons. A memorandum of a transaction between two brokers giving full details, with date, description of security, number of shares or bonds, price and conditions of delivery. Comparisons are made up in duplicate, the buyer and seller both comparing. If the transaction is found to be correct the original is signed and returned, the duplicate being kept as a record. Confirmations (Customers). When an order is executed for a customer a report of the transaction is mailed to the customer, indicating the name of the house with whom the transaction was made, the number of shares, the price, the cost, the com- mission, the tax (if a sale), and the final extension. Consolidation. See merger. Contingent Order. An order depending on the execution of another order before it is effective. For example a broker may receive the following. “Sell 100 American Can @ 105, good until cancelled; or, buy 100 General Electric @ 210, when bought, sell 200 Anaconda at the market. Control. In brokers’ offices each ledger is balanced indi- vidually. This eliminates the necessity of checking every 359 WALL STREET ledger in case of a difference at the end of the month in taking a trial balance, the control showing the debit or credit balance of each ledger individually. Convertible. Any security which provides in its issuance that it can be exchanged, under certain conditions for another se- curity called a convertible stock or bond as the case might be. There are any number of such securities listed in the vari- ous markets of this country and afford at times excellent opportunities for arbitrage. Convertible securities also offer chances for investment with the added attraction of speculation, at a minimum of risk. For instance good bonds may occasionally be bought around 100 which are convertible into common stock on an attractive basis. If the company is prosperous it will be reflected in the market price of the common stock which in turn will cause the bonds to increase in market value. Corner. This occurs when a single financial interest gains control of practically all the shares of a certain stock and can advance the price as they wish. This occurs mostly when speculators who have sold the stock short find they are unable to cover without paying the price asked by the interest con- trolling the stock. Coupon Bonds. Bonds having coupons attached for the periodical payment of interest. These are detached at the proper time and the amount indicated thereon is collected. (See collection of coupons.) Covering. Covering is the purchase, by a trader, of those shares of stock which he has previously sold short. Credit Balance. The difference between the debit and credit side of an account; the credit side being the larger. When securities are sold short an account may show a credit balance, which is not a true reflection of the account, as a false credit is created by a short sale. A Credit balance without securities is termed a free credit and is the amount due to the customer. (See bookkeeping chapter) 360 WALL STREET D Daily Balance. A bookkeeping balance taken off daily by the control clerks which shows that all entries for that day are in balance. The term is also used for a certain kind of cus- tomers statement on which the interest is figured on the daily balance in each account, instead of figuring on each individual item during the month. Date of Trade. The day on which an order is executed or a trade consummated. This is distinguished from clearance date, (to which refer). Day Clearing Branch. That part of the Clearing House which handles all deliveries and payments in the Central Clear- ing Department, in addition to making proper cash adjustment for securities delivered between brokers against receipt, such as result from three-way transactions. This has proved a great convenience to clearing members who settle all transactions through the Clearing House with one settlement check. Day Order. An order which is automatically cancelled if not executed on the day it is given. Dealer. One who deals in securities as a principal rather than as a broker. A dealer sells to and buys from a client whereas a broker buys and sells for the account of a client. The - dealer buys and sells at a net price, the broker charges a stipulated commission. Classed as dealers are the odd-lot brokers on the floor of the Exchange, who trade only with fellow members, houses of issue which sell their own underwritings to the investing public and the great number dealing in unlisted securities. Debit Balance. The sum representing a client’s debit, or the amount owed, against long securities. Of course there may be a debit balance against no securities. In this case it is called an unsecured account. Definitive Certificates. Actual and permanent certificates of bonds or stock given in exchange for temporary receipts. These temporary receipts are usually issued at the time of a new offering before the engraved certificates are available. 361 WALL STREET Delayed Delivery. Securities sold with the understanding that they will not be delivered in the regular way, that is on the regular clearance date. In the case of bonds a separate agreement is used stating how long the interest is to run and at what rate. Deliveries. According to the rules of the New York Stock Exchange which are generally followed out in financial New York, deliveries of securities must be made before 2 :15 P. M. (Hammonds Time) on the following full business day, if sold in the regular way. If sold for cash they are made before 2:15 P. M. on the date sold. In case of failure to conform to these rules the buyer may resort to a “buy-in,” to which refer. Delivery Bills. Bills accompanying a security delivery giv- ing full details. If necessary the required amount of Federal and State tax stamps are affixed to the bill. Demands. See Clearing House Ticket. Discretionary Orders. Orders given to brokers, or customers men to be executed solely at the discretion of either. Such orders should be strictly avoided both by the client and the broker. In the first place entirely too much responsibility is placed on the one receiving such an order and secondly there is absolutely no redress for the client in the event of a person handling such orders in an unethical manner. Diversified Buying. Cautious investors do not put all their funds in one line of business, such as Oils, Industrials, Public Utilities, etc. Instead, they split up their funds and buy comparatively small amounts of stocks and bonds of many different lines of business. This is diversified buying. In case of a depression in any particular line only a portion of their securities would be affected adversely. Dividend Account. An account appearing in the general ledger used for the purpose of setting up certain dividends which are to be received or paid out. Theoretically this ac- count should be even-up after all dividends have been paid but in actual practise the account usually shows a credit due to the fact that investors have failed to transfer their stocks in time to receive the dividend. Some of these dividends are of course claimed and after being paid are charged to the account. 362 WALL STREET However all brokerage offices have credits in their dividend ac- counts which are kept on the books for a long period and even- tually credited to profit and loss. Dividend (Cash). Cash dividends are paid to stockholders out of the earnings of a Corporation, unless announced to the contrary. It sometimes occurs that a corporation has built up a very large surplus but having one year which has shown no profit the dividend is paid out of surplus. This procedure could not, be carried on indefinitely as it would weaken the position of the Corporation. The cash dividend received by stockholders represents the income or yield on their invest- ment. If an expected dividend is not paid it is said to have been passed. The Corporation sets a date on which stock- holders of record will be entitled to the dividend. This is explained under Ex-Dividend. Dividend Claims. Brokers or individuals not transferring stocks in their own name in time to receive the dividend may make claim for said dividend from the party in whose name the stock is registered. If the record at hand does not show in what name the stock is registered this information can usually be obtained from the transfer office. The method of procedure is fully explained in the chapter under dividends. Dividend Off. See Ex-Dividend. Dividend On. Securities sold with the understanding that the buyer is to receive the next dividend. If the security has previously sold Ex-Dividend but has not as yet been paid the security would be accompanied by a due bill evidencing the right of the buyer to receive such dividend. Dividend Proof. The record kept by the dividend clerk, which shows all customers and accounts to be credited with a dividend and the sources from which it would be obtained. If this balances evenly the dividend clerk has proved the cor- rectness of his record. Dividend (Stock). A distribution of additional stock by a Corporation to bring its surplus and capital to a more reason- able ratio. The stock is distributed to recorded stockholders in proportion to their holdings. Assuming the stock dividend to be 20 per cent, the holder of 100 shares would receive an additional 20 shares making his total holdings 120 shares. 363 WALL STREET It must not be taken for granted that this twenty shares represents additional value, as a stock dividend results in an increase in capital but the same decrease in surplus. The market value of 120 shares would probably approximate the value of the original 100 shares immediately after the distribu- tion, but ultimately the prosperous conditions of the Corpora- tion would be reflected in higher prices and larger dividends. Don’t Know. An expression used by a broker to state that a certain transaction which another broker is attempting to confirm or compare, is unknown to him. When a mutual under- standing is reached the trade is properly compared or can- celled. Due Bill. An instrument passed between brokers stating that dividends, rights to subscribe, stock dividends, etc. are the property of the holder of the due bill. There are two kinds in general use, one which is given on Ex-Dividend dates on fail to deliver and stock borrowed, and those demanded on fail to receive and stocks loaned. For instance Jones & Co. were failing to receive 100 shares of stock from Kahn & Co. Jones & Co. would then demand a due bill covering this divi- dend from Kahn & Co. The other form is used during the period between stockholders of record date set by a Corpora- tion, and the Ex-Dividend date set by the Exchange. See chap- ter on Dividends for full explanation. E Equity. Equity is the amount of money that would be due to a trader from his account should it be closed at the market prices. Also used to designate the amount of money repre- sented by the value of collateral in loans over the amount borrowed. Even-Up. When a trader sells all of the shares of any se- curities he is long of or covers all the shares of any securities he is short, he is termed “Even-Up” on that security. Ex-Blotter. A large receive and delivery sheet used in the cage of brokerage houses where all items not recorded in con- nection with the transactions of the Night Clearing Branch are entered. This would include bank balances, fail to receive and deliver, cash transaction with customers, bank loans, divi- 364 WALL STREET dends, receipt and delivery of securities with customers, un- listed securities, commissions (exclusive of Clearing House) taxes, etc. All final balances being shown on the Ex-blotter it is the balancing medium by which all entries are brought into reconciliation. Excess Equity. When a trader’s equity exceeds the margin requirements on his securities the difference is “Excess” or “Surplus Equity.” Exchange of Securities. The result of mergers or consolida- tions wherein stockholders have approved the exchange of securities to those of another Corporation. See details of con- solidation of Royal Baking Powder & Co. and Fleischman discussed in chapter devoted to transfers. Ex-Dividend. As applied to sale of a stock it means that the dividend that has been declared will be paid to the seller, or that the buyer is not entitled to said dividend. In reference to a date it means the particular day designated by a Corpora- tion on which stockholders of record will be entitled to receive the dividend. For instance the United States Steel Co. declares a dividend of $1.75 per share payable on May 16th to stock- holders of record April 14th. The Ex-Dividend date would therefore be April 14th unless it were a Saturday in which case April 13th would be the Ex-Dividend date, as far as deal- ings on the Stock Exchange were concerned. The Corpora- tions however would still pay the dividend to stockholders of record April 14th. This results because of the fact that no deliveries are made on Saturday on the Stock Exchange. In the above case (Ex-Dividend Date April 14th) all securities sold for regular delivery on April 14th would not carry the dividend, in other words the buyer would not receive it. Se- curities sold for cash, (immediate delivery) would carry the dividend as the buyer would be able to transfer the stock to his own name and receive the dividend from the Corporation. Cash transactions would be quoted 1 % points higher than reg- ular delivery transactions. When corporations declare stock dividends or right to subscribe the Ex-Dividend dates are usually adjusted in a different manner. While a Corporation may declare a stock dividend to stockholders of record August 10th which would ordinarily be the Ex-Dividend date, the Stock Exchange might rule that the stock shall not sell Ex- 365 WALL STREET Dividend until August 28th. This ruling will not affect the actions of the Corporation and therefore all transactions be- tween August 10th and August 28th would bear due bills covering the stock dividend. Where out of town transfers are necessary the Ex-Dividend date for stockholders of record as of the date announced by the Corporation is advanced a few days in New York to allow for time consumed in the transit of the stock. Exercising Rights. Rights being the privilege of subscrib- ing to a certain amount of securities at a stated price within a stipulated time, the process of subscribing is termed ‘exercising the rights.’ If the certificate states that 10 shares may be sub- scribed for at $50 per share, the holder would forward the rights together with check for $500 to the Corporation’s agent, who would return a certificate for 10 shares of stock. In exer- cising rights full instructions should be given to the agent including full name, address, etc. so that the stock may be properly registered. The rights must be exercised on or before the expiration date set by the Corporation. Exhaust Price. The price at which a customer’s margin or equity would be entirely wiped out. At this point the broker would be compelled to sell out or cover all securities to prevent loss. In actual practice however a stop-loss order is entered at a price which would take care of all interest and commis- sion and still leave a small credit. Previous to the reaching of this condition however additional margin has been demand- ed. If the margin is furnished the stop-loss order is cancelled. Ex-Interest (Or Coupon). Delivery of a bond with the cou- pon detached. This is done when the interest payment is due or is about to become due, and depends on the provisions sur- rounding the trade. Registered bonds are also delivered with- out interest when it is impossible to re-register it in the buyer’s name in time to receive the interest from the Corporation. Expiration Date. Generally used in connection with the date on which rights or other privileges expire. If rights are not exercised on or before the date set they become valueless. Ex-Rights. See Ex-Dividend. 366 WALL STREET F Fail to Receive or Deliver. On every full business day a broker has certain stocks to receive from all other brokers. Any part of these securities which are not received are entered on the Ex-Blotter under the account of “Fail to Receive.” This contra entry is always placed on the credit side on the day of fail to receive. For example, Harris, Jones & Co. are to receive 100 shares of United States Steel from J. Peabody and Co. for 20,000 dollars on account of a purchase from them. J. Peabody and Co: do not deliver the stock that day, so in order to close the transaction temporarily, Harris, Jones & Co. make an entry on their blotters for the “Fail to Re- ceive” account stating that J. Peabody and Co. owe them the stock for 20,000 dollars. The next day J. Peabody and Co. deliver the stock to Harris, Jones & Co. Harris, Jones and Co. now make an entry on their blotter showing the receipt of the stock for the “Fail to Receive” account for $20,000. Failed to deliver items are handled in a similar manner the contra entry being placed on the debit side of the blotter on date of fail to deliver. When the item is subsequently delivered it is placed on the credit side for the account of “fail to deliver.” Fail Notices. A notice sent from one broker to another stating that certain securities have not been received or de- livered on the regular clearance date. If the notice is correct it is signed and returned to the sender who retains it as proof of the correctness of the transaction. Federal Tax. As applied particularly to the sale or transfer of stocks the law requires that the seller shall pay a tax of 2c for every $100 par value or 2c per share on no-par value stocks. Floor Reports. Reports of execution of orders giving full details including price, number of shares and from whom bought or to whom sold. These reports are sent to the Clearing House Department of the brokerage office where they are matched up with the reports received from the order room. Floor Broker. A member of the Exchange who specializes in executing orders for other members at the usual floor brok- erage commission rate. 367 WALL STREET Full Lots. All transactions of a hundred shares of stock or $10,000 par value bonds or multiples thereof, are full lots. Full Paid. In issuing securities of new Corporations a stock is said to be fully paid when it has been issued in exchange for its full face value, either in cash, property or an equivalent. Another use of the term is to differentiate between various payments on stocks which have been offered to the investing public in part payments. Provisions of issuance might state 1st installment 20 per cent; 2nd installment 40 per cent; 3rd installment 40 per cent. These securities would be quoted 1st installment paid, 2nd installment paid and full paid; or, 20 per cent paid, 60 per cent paid and full paid. G Give Up Orders. Orders placed by a client with a house other than the one in which he has his account. The broker executing the order ‘ ‘ gives up ’ ’ the name of the firm in which the customer has his account and the stock is received or de- livered to this firm. Brokers who do not clear their own trans- actions also “give up” the name of the clearing broker. Good Delivery. Delivery of securities which conform to the rules for delivery as established by the New York Stock Ex- change. (See Chapter entitled Cashier Department). G. T. C. Good till cancelled. Good Through a Given Date. Orders placed at a limited price to be in effect only for a stated period, such as Buy 100 Anaconda @ 78 Good through Oct. 18th. If the order is not executed it is automatically cancelled at 3 P. M. Oct. 18th. Good Transfer. Any transferable security which would meet with the requirements of the transfer agent in transfer- ring it to another name. A security may be a good transfer, but not a good delivery according to the delivery rules of the Exchange. For example, a stock registered in the name of Mary Carr, a single woman, would not be a good delivery due to the omission of the prefix “Miss,” but it would be a good transfer, providing of course that the certificate was properly signed and signature guaranteed. Good Until Cancelled. See Open order. 368 WALL STREET H Hammonds Time. The name is derived from the name of the watchmaker who supplies the official time to the New York Stock Exchange. Hammonds Time is exactly 2 :15 P. M. es- tablished by fifteen distinct beats on the ticker, following the words “Hammonds Time”. 2:15 P. M. is the recognized set- tlement time for transactions on the Stock Exchange and de- liveries may be refused after that time. Hedging. Any transaction which would tend to lessen loss or prevent loss on a commitment already made, such as trading in puts and calls, switching from a long position to a short position, and vice versa, or selling au entirely different stock short to offset possible losses on other stocks previously bought. House of Issue. Any financial institution, bond house, bank- ing house or broker who offer original issues of securities for public sale, either through their own efforts or by wholesaling a portion thereof to other distributors. Hypothecate. To pledge and deposit securities, as collateral against money borrowed. I Immediate. As applied to the execution of an order, which is usually given in the following form, Buy 100 Standard Oil 67, immediate or cancel. If the order cannot be immediately exe- cuted at this price or lower, it is cancelled. The term is also used in designating the time for the delivery, as when securi- ties are bought for cash, meaning immediate delivery. Securi- ties bought in this manner must be delivered at once or before 2 :15 P. M. on the same day purchase was made. Income Tax. The Tax imposed upon the net income of Cor- porations, partnerships or individuals by the Federal Govern- ment. This income tax became effective March 1, 1913. The State of Massachusetts and New York has similar tax laws which became effective January 1, 1916 and January 1, 1919, respectively. Profits or losses through trading in securities must be included in the income tax returns. Indenture. As used in connection with bond issues, it is the contract between the bond holders, the trustee, and the issuing 369 WALL STREET party covering every detail of issuance, redemption, interest, etc. It is usually deposited with the trustee. Interim Certificate. Sometimes called temporary certificates which are issued to purchasers of new security offerings. These are held until the permanent certificates are available at which time they are exchanged. Investment Buying. The term used when the condition of the market indicates that securities are being bought for in- vestment purposes. Continuous buying of this kind usually results in a strong market as the purchases are made with the intent of holding for an indefinite period or for a long pull, thus reducing the floating supply. It is entirely different from speculative buying or professional buying in which cases a quick market profit is anticipated. Investment Trust. A corporation formed for the express purpose of making investments, usually in securities. Such corporations offer their own Corporation securities for public sale using the funds derived therefrom to purchase such in- vestments as their policy and judgment dictates. There are several kinds of investment trusts, such as the management type where the nature of the investments is left to the directors and the fixed type which can only purchase those securities agreed upon when the trust was formed. Issue Price. The original price at which securities are offered for public sale. The offering is usually made by a syndicate of distributors who obtain the security at a lower price, the dif- ference representing their profit. J Joint Account. An account in which two or more persons have a mutual interest. All losses or profits are divided evenly after the deduction of all expenses, which might include a special distribution for the person carrying the account or con- ducting its operations. Journal Entry. These are charges to one, and credits to an- other account of the same items and amounts. They are chiefly used in brokerage houses, for interest, cash transferred from one account to another, and to adjust errors. 370 WALL STREET L Limited Order. An order for any duration of time, that is, for the day, for the month, good until cancelled, etc. on which a price limit is placed as “buy 100 General Electric @ 216 1 /2”* Listed Stock. In a very broad sense this refers to securities listed on the New York Stock Exchange although it actually means securities listed for trading on any recognized Exchange. Loan Crowd. A name given to those brokers who wish to loan or borrow stocks. These transactions are usually con- summated on the floor of the Exchange. Loaning Flat. A broker who borrows stock puts up the mar- ket value of the stock with the lender. In most cases the lender allows him interest on this money, at a loaning rate, until the stock is returned. If, however, there is a great demand for this stock, it may be “loaning flat” which means no interest is allowed on the money. Loaning at a Premium. First read, loaning flat. In other cases there is such a great demand that the broker not only receives no interest but is compelled to pay, each day, a certain sum for the privilege of borrowing the stock, which is called a premium. Long. When a broker purchases or receives securities for a client’s account. Until the securities are sold or delivered, the client is “long” of these securities. Long Pull. To take either a long or short position in the market with the expectation that it will have to be maintained for a long period. For instance an investor may beleve that a certain Corporation is in line for exceptionally large profits but that it will take some time for this prosperity to be reflected in higher quotations for the stock. He will therefore purchase the stock and hold it until his expectations have been proved or perhaps disproved. M Margin. The money or equivalent deposited by a customer with a broker to protect securities purchased (long) or sold (short). For instance, Jones wishing to buy 100 shares of 371 WALL STREET General Electric at $210, costing $21,000, and not having this amount would deposit $5000 as margin on the account. His account would then have a 50 point margin which his broker would ask him to maintain. Should General Electric decline to 195 the margin in the account would be reduced to 35 points and at this point Jones would receive a margin call requesting an additional $1500. Collateral may also be used as margin in the following manner. Brown deposits 100 American Can with his broker and at the same time places an order to buy 100 additional shares at the market, say at 105. His holdings would then amount to 200 shares and the value of the 100 shares de- posited, $10500, would represent the margin of approximately 52 points. The subject is fully explained in the chapter en- titled “Margin Department’’. Margin Calls. If the market changes, thereby reducing the equity in a trader’s account to a point where the broker re- quires more margin, the trader is then requested to put up additional money to cover the deficiency. This request is a Margin Call. Inability or failure of the customer to comply with the margin call would result in closing out the account or the placing of stop-loss orders at the point of exhaustion of the margin. Market Order. Buying or selling orders to be executed at the best possible price after receipt of the orders. Marking Borrowed and Loaned Stock at the Market. A broker borrowing stock from another broker, gives the other broker a check for the market value of the stock. Should the stock advance in price, the broker borrowing it is required to give an additional check to cover the advance, in other words, he is “marked up to the market”. When returning the stock, the broker who borrowed it will receive all his money back. Matching Reports. The Purchase and Sales department re- ceives memorandums of all executions of orders from the order room. They also receive a report from the broker executing the order. The Purchase and Sales Department now compares these two reports to see if they match. Merger. Combining the interests of two or more Corpo- rations under one management. A consolidation or amalgama- tion. In a merger the larger Corporations usually take over 372 WALL STREET the smaller units continuing with the Corporate name of the larger. This, however, is not always the case as there may be a merger of several equally large and important Corporations, with an entirely new Corporate name. Mixed Collateral. Collateral of different kinds pledged against a loan. Such collateral could be a mixture of railroad, industrial or public utility securities. In other cases it could be curb securities, unlisted securities and listed securities. The latter is sometimes called a special loan on which the rate of interest is slightly higher. Money Balance. The term is used to distinguish it from a security balance. For instance, a customers statement would show a debit balance of $56,825.00 against 400 Radio and 400 U. S. Steel. This sum would of course be the money balance and the Radio and U. S. Steel, the security balance. Monthly Statement. A statement rendered to customers showing every detail of transactions made during the month. The statement is usually headed with the money and security balance of the previous month, followed by each transaction in chronological order. Each transaction shows date, number of shares, price and final extension. In some cases interest is figured on each individual transaction but other systems figure the interest on the daily money balance. Interest is charged or credited to the account, based on cost of money, character of the account and activity of the account. The statement ends with the money balance and security position as at the end of the month. See Chapter on “Bookkeeping Department” for detailed information. N Net Price. The price established after making all allow- ances, for discounts, commissions and any other expenses : Dealers in securities buy and sell at net prices. See Dealer. Net Return. The income received on an investment. On stocks which may be classed as perpetual, that is, usually hav- ing no maturity date, the net return is obtained by dividing the dividend rate by the cost of the stock. For example a stock selling @ $150 per share and paying $6.00 per share an- nually would yield a net return of 4%. The net return on 373 WALL STREET bonds must be figured on a different basis as the time element must be taken into consideration. The process of finding the net return on a bond selling at 102 V 2 , paying 7% in semi- annual payments and maturing in 15 years 3 months and 14 days is somewhat involved. Specially prepared tables available in all brokerage offices are used to simplify this work. Night Clearing Branch. That part of the Clearing House which reconciles all trades listed on the Clearing House Sheets sent in by members of the Exchange. Purchases are paired off against sales, money differences are adjusted by check or draft (See Clearing House Draft) and names of brokers to receive from and deliver to, are supplied on security balances. (See Clearing House Balances). No Money. A term commonly used in brokerage and bank- ing circles to denote that securities are to be received or de- livered against “no money,” or to be received or delivered “free”. For instance a customer desiring to put up additional margin will deposit 50 shares of Anaconda against which he will not withdraw any funds. 0 Odd Lots. All transactions under 100 shares of stock or $10,000 par value of bonds are called “Odd Lots.” Odd Lot Sheets. Sheets used between brokerage houses and the odd lot specialist to eliminate unnecessary deliveries and to bring these very heavy odd lot transactions down to one settlement check. It is possible for 500 transactions or more to be cleared by three or four actual deliveries. The functions of this sheet are fully explained in the chapter covering Cashier’s Department. Odd Lot Specialists. Those members of the Exchange who specialize in buying and selling odd lots of stock with fellow members only. Odd lot houses have no individual customers their transactions being conducted exclusively with other mem- bers. Due to the nature of this business odd lot specialists must trade for their own account and consequently they are at times forced to take a position in certain stocks. The trans- actions in odd lots reach a great volume and some odd lot houses have as many as ten board members. An immense 374 WALL STREET clerical force is required to carry on the work. The methods used in executing odd lot orders are fully explained under, chapter, “Order Room”. Open Orders. Good until cancelled (G. T. C.). Orders to buy or sell at a fixed price with no time limit. These orders remain in force until executed or cancelled. They are also known as G. T. C. orders, meaning good until cancelled. Open Trades. Incompleted transactions resulting in a long or short position. When a trader is long 100 shares of General Motors, it is an open trade. When this 100 shares are sold the trade is completed or closed. Order Room Reports. These are reports of executions com- ing from the order room, from which is built up, the customers confirmation, clearing house sheets, odd lot sheets, etc. When the reports reach the Clearing House Department they are matched up with the reports coming from the floor of the Exchange. Outright Purchases. See cash accounts. Over Certification. To certify checks for a larger amount than on deposit. An accommodation extended to some brok- erage firms by banks whereby over-certification is granted up to a certain sum, the amount depending on the size and stability of tfie house and the average daily deposit of the broker. The bank of course requires proper protection and this is effected by the broker signing a note for the desired amount of over-certification, which the bank retains until the amount is returned at the end of the days business. The ac- commodation is for one day only and must be renewed each morning. The reason for over-certification is the heavy tem- porary financing which every broker must arrange for until he is reimbursed by the proceeds of out-going deliveries. Over-certification is usually accomplished with no further collateral than the note, although smaller houses may be re- quired to deposit acceptable collateral in the form of securities. Over Delivered. Delivering a greater amount of stock than called for, the surplus amount being returned by transferring it to the name of the delivering broker. See example in chap- ter devoted to Cashiers Department. Over the Counter Securities. See unlisted securities. 375 WALL STREET P Pair offs. Sometimes it occurs that two brokers each owe one another the same number of shares of the same issue of stock. This arises when one of the brokers has failed to de- liver, and at a later date, on account of a purchase, he is to receive shares of the same issue of stock from the other broker. Instead of actually receiving the stock and delivering it back again, they will “Pair-off” the transaction, giving or receiv- ing a check for the difference in price, or exchanging cheeks for the full amount of each side of the transaction. Paper Profits. If a trader purchases securities and they ad- vance in price, the profit is called “paper profit” until the securities are actually sold. Paper profits (or losses) may not be included in making individual income tax return as the trade must be closed before the profit or loss can be estab- lished. Par Value. If a stock is selling at $100 traders sometimes use the expression “Selling at Par”, although the correct meaning is the nominal value placed on the stock by the issu- ing Corporation. The term used in relation to bonds means the face value or principal amount. Many stocks, particularly mining issues have a very low par value, sometimes 10c per share. If this stock should be quoted $1.00 per share the capitalization of the company is being quoted at ten times its original worth. Therefore while the stock may appear cheap at $1.00 it is in reality very high. It is most important there- fore to find the rates between market value and par value before assuming that stocks quoted very low are cheap. Part Paid. See full paid. Passed Dividend. When a Corporation fails to declare a dividend at the regular period, or ceases to pay dividends it is said to have passed its dividend. Percentage (Margins). In a number of houses margin re- quirements are on a percentage basis. The percentage is gen- erally figured on the market value of the traders holdings or the amount of the debit balance. Points. A point, in Stock Exchange parlance, and in relation to stocks only, means a dollar a share. In a number of houses 376 WALL STREET margin requirements are on a point basis. The number of points required varies according to the price of the security. For instance if a stock advances from 170 to 175 it is said to have advanced five points (or five dollars) in value. A point advance on a $1,000 bond however would be equivalent to $10. Position. This term is used in referring to a customer’s ac- count with reference to the securities he is long or short and the amount. Post. The bookkeeping department transcribes entries from blotters, journals and other books of original entry, to the ledger accounts. This is known as posting. Premium. The excess of the price of a security over its par value. For instance stock selling at $105 would be at a premium of 5%, providing that the par value was $100 per share. Stock with a par value of $50 per share and quoted at $55 would be at a premium of 10%. If the par value were $200 and the current quotation 150 the stock would be selling at a considerable discount, notwithstanding its apparently high price. Principal. The face value of any security and the amount an investor is entitled to receive at maturity, providing that it is a security having a definite date for the paying off of the obligation. This does not include any interest or premiums. Supposing that a bond was redeemed at 105 and interest, totaling $1059.67. The principal amount would be $1000. The principal is also the basis on which interest or dividends are figured. Private Envelope. See safekeeping. Produce Exchange-Trades. Referring to securities, the trades which are made in the securities department of the New York Produce Exchange. The Produce Exchange has been in existence for a great many years for the purpose of trading in commodities but recently added a department for trading in stocks and bonds. The rules and regulations are substantially the same as on the two other Exchanges in New York. Puts. See calls. 377 WALL STREET Pyramiding. Pyramiding is the buying of additional shares as the market advances using the excess equity in lieu of depositing additional margin. Example : Mr. Trader buys 100 shares of U. S. Steel at 160, and deposits the required margin, say 30 points — $3,000. Steel now goes up to 175. His equity having increased to $4,500, Mr. Trader buys 50 addi- tional shares. Steel now reaches 190. He buys another 50. When it reaches 200 he buys another 50 shares. Now the stock reaches 210 and he sells his holdings. After selling the 250 shares, he has made a profit of $8,250, whereas if he had not pyramided he would only have made $5,000 on his original 100 shares. In the above case the trader was very successful, but pyramiding usually results in disaster. It is obvious that the account is not strengthened in any manner, that is, there is no increase in the margin or amount of equity. A reaction of 45 points after a rise of 50 points would not be unexpected and this would wipe out the margin. It is therefore seen that the account would be sold out at 165 whereas the original commitment of 100 shares was protected down to 130. Q Questionnaire. A form sent out semi-annually by officials of the Stock Exchange to its members. Completion of the form by the brokers shows the exact condition of the broker’s business such as entire amount of cash on hand, money bor- rowed, debit balances, equity, securities in safe keeping, the condition of firm trading accounts, etc. The filing of a ques- tionnaire requires a complete audit of the firm’s books. R Reconciling Bank Balance. At the end of any stated period the books of a firm will show a certain bank balance which agrees with the amount in the check book. Upon receiving a statement from the bank together with the cancelled checks, it is necessary to ascertain which checks are still outstanding. This is done by putting the cancelled checks in numerical order and checking back against the stubs in the check book. The amount of outstanding checks deducted from the balance shown by the bank statement should equal the amount shown in check book and ledger. 378 WALL STREET Redemption of Bonds. When a bond has been called for redemption (see callable bonds) the certificate is presented to the Corporation’s agent who makes payment at the redeemable price, plus interest. A date is usually set for said redemption at which time the interest stops. It is therefore necessary to present the certificate on or before the redemption date to pre- vent loss of interest. Re-Discount Rate. The variable rate charged by the Fed- eral Reserve Bank to re-discount commercial paper of member banks. In this connection the Federal Reserve acts as a bank- er’s bank. Member banks who have depleted their own funds in discounting paper for their patrons are thus enabled to send this paper to the parent Reserve Bank and receive in return either Federal Reserve Notes (currency issued under the Federal Reserve Act) or a credit on the books of the bank to the amount of the total loan. This Re-discount Rate is a variable one, rising or falling at more or less frequent inter- vals in sympathy with the economic law of supply and demand. Registration of Securities. As applied particularly to stocks. Every Corporation has a record of the name of each stockholder, which is usually called the transfer book. When dividends are declared the money or stock (in case of a stock dividend) is sent directly to the stockholders as shown on the Corporation books. Owners of stock should therefore see that the certificates are properly registered in their own names with proper address, etc. Registered Bonds. Bonds not issued in the usual bearer form. The certificate shows the registered owner thereof and it is not negotiable unless properly signed. Some bonds are registerable both as to principle and interest in which case the coupons are detached. Others are registerable as to principal only and the interest is paid by the periodical coupons. Request for Report. Asking the order clerk for a report on an order previously placed. For instance Mr. Brown enters order to buy 100 General Motors @ 56, and shortly afterwards a sale at this price appears on the tape. If no report of the execution of the order is forthcoming, within a reasonable time, Mr. Brown will ask for a report. The reply would usually be in one of the following forms, “Bought 100 General Motors 379 WALL STREET @ 56”. Sale occured before your order was entered. Stock ahead of yours at this price. Regular Way. Securities bought or sold “regular way” are to be cleared or delivered before 2 :15 P. M. of the next follow- ing full business day. Renewal Rate. The rate of interest, usually announced about 11 A. M., governing the interest on all call loans in force that day. If the announced rate is higher than the pre- vious day the lender should notify the borrower of the ad- vanced rate ; if lower, the borrower should notify the lender of the reduced rate. Reorganization. The usual term applied when a Corpora- tion, through mismanagement, bad business conditions or for some other reason, is unable to meet its obligations at ma- turity or earn interest or dividends on its outstanding secur- ities, and therefore requires a thorough reorganization. This usually results in the issuance of new securities, either in ex- change for old securities or an offering at a price to acquire additional capital. In any case maturing obligations, interest or payments on them are adjusted in such a way as to keep the Corporation from going into bankruptcy. Rights. The privilege offered by a Corporation to its stock- holders to subscribe to certain securities at an advantageous price. If the subscription price remains lower than the market price of the new issue, after giving effect to capital changes, etc. the rights have a value, but if the subscription price is higher the rights are valueless. Rights are figured on the num- ber of shares held. For instance if an investor holds 100 shares of a certain stock and is offered the privilege of subscribing to twenty new shares, he has 100 rights, although the sub- scription warrant he would receive would state that he is entitled to subscribe to twenty shares. Round Lots. Round lots are 100 shares of stock or $10,000 par value bonds, or multiples thereof. S Safe Keeping (Private Envelope). Securities that are fully paid for are placed in an envelope marked with the client’s name and set aside for disposal according to the client’s in- 380 WALL STREET structions. This proceeding is alternately described as “Put- ting in Safekeeping”, or “In Private Envelope”. In event of failure, safe keeping or private envelope securities cannot be included in the assets of the bankrupt firm. Sell or Buy at Close. An order, usually at the market, to be executed immediately before the closing of the market. Sellers Option. The sale of a security where the seller has the privilege of delivering on or before a specified time. How- ever if he desires to make delivery before the end of this period it is necessary to give one day’s notice to the buyer. For ex- ample, a sale made seller 7, means the seller has 7 days to make delivery, but if he wished to make delivery in four days he must give the buyer notice. Short Sales. When a broker sells securities for a client who is not long of the securities, until the securities are either pur- chased or received the client is called “short” of these se- curities. Short selling, i. e., selling securities which were not previously long, with the intent of purchasing them at a later date, is permissible in Wall Street. Signature Guaranteed. In order that a registered security may be a good delivery on the Exchange or a good transfer the signature of the registered owner must be properly guaran- teed. The guarantee of a New York Stock Exchange, firm, a Curb market firm or a bank is usually considered sufficient guarantee. Specialist. A specialist is a floor broker who is particularly interested in a certain issue and makes a specialty of executing orders and at times making the market in these issues. As such he handles the orders of many other brokers. His opera- tions however are subject to very rigid rules laid down by the Stock Exchange. Special Loan. Loans in which the collateral is of a special nature, usually securities which are not listed on the New York Stock Exchange. It is customary for the lender to charge a premium over the current rates for loans of this kind. Spread Opening. Where there is a volume of orders at the opening of the market, a stock will open 10,000 shares 170 to 171, which would make the opening price 170 or 171. 381 WALL STREET Stamped Security. Any security, stock, bond or note that has been stamped showing some special provision or change which has taken place since originally issued. This might in- clude the stamped endorsement or guaranty of another Cor- poration, change in interest rate, change of callable or ma- turity date or a change in mortgage or security provisions. State Tax. Usually applied to the selling or stock transfer tax of 2c per $100 par value or 2c per share in case of no par value imposed by the State of New York. Stock Borrowed. A broker needing certain stocks for de- liveries, may borrow them from another broker, paying the oilier broker the market value. Stock borrowed items are sub- ject to interest, premiums and mark ups. (See loaning flat, loaning at premium, and marking borrowed and loaned stock). Stock Exchange Seat. A person owning a Stock Exchange Seat has the privilege to buy and sell securities on the floor of the Exchange. To obtain the seat or membership it is necessary to pay the price, initiation fees and be duly elected according to the constitution of the Exchange. In the case of the New York Stock Exchange the seats are very valuable but the price is subject to the activity of the market and other busi- ness conditions. Stock Holders of Record. The date set by a Corporation for payment of dividends or for other purposes, the stockhold- ers of record on this date receiving any benefits that have been decided upon by the directors. The large Corporations usually close their transfer books on this date so that a record of all stockholders can be taken. The term is also used to designate the Ex-dividend date. Stock Loaned. Securities loaned at the market value the loaner paying the current rate of interest on the money re- ceived. (See Stocks Borrowed). Stock Split. The term is sometimes used to denote certain methods of rearranging the capitalization, usually by splitting the common stock issue into two different classes of stock. The general use of the term Stock-Split is to indicate the re- duction in par value and the issuance of additional stock with- out change in the total capitalization. For example a Corpora- tion is capitalized with 40,000 shares of stock, par value $100, 382 WALL STREET total capitalization being $4,000,000. For some reason it has been deemed advisable to reduce the par value which is effect- ed by calling in the original stock and issuing 400,000 shares of $10 par value stock. This would constitute a stock split in the ratio of 10 for one. Stop Loss Order. An order entered at a certain price to prevent loss, to minimize loss or to conserve profits. For in- stance John Kane buys 100 Montgomery Ward @ 58 and wish- ing to limit his losses to about $400 places an order to sell the 100 shares at 54 stop. As soon as the stock sells at 54 Mr. Kane’s order becomes a market order and is immediately ex- ecuted at the best possible price. In a very active and fast receding market it is possible that the stock may be sold at a considerably lower price, but in most cases the order would be executed reasonably close to the stop loss price. The sub- ject is fully covered in chapter under “Order Room”. Stop Loss Entered. When a customer is called for addi- tional margin and fails to respond, the margin clerk enters a stop loss order to protect the account and marks his margin book accordingly. The customer is of course duly notified. (See Exhaust Price). Street Name. When a security is registered in the name of a recognized brokerage firm, usually members of the Ex- change, it is said to be in a “Street Name”. Subscription Warrant. The actual certificate usually reg- istered in the stockholders name evidencing his right to sub- scribe to certain securities. The certificate states the number of shares or bonds to which he may subscribe, the subscription price and the time limit or expiration date. Warrants are not traded in, the market being made for the rights which the warrant represents. (See Rights for further explanations of this subject). Substitution. When a broker needs stocks or bonds that are in a loan as collateral, instead of paying off the loan he may “substitute” other securities of equal value and withdraw the ones that he requires. Surplus Equity. See excess equity. 383 WALL STREET T Take-Off. This is a sheet or set of cards used in the Stock Record department which shows the changes of all the se- curities for each day. To obtain the take-off the clerk in the Stock record department dbtains a ■complete record from every department handling securities and segregates them by listing under the name of the security. When the work is completed the securities on the long side, should equal those on the short side. Taking a Position. See position. Tax. On all sales of stock there are Federal and New York State taxes charged at the rate of 2c per $100 par value or fraction thereof, or at the rate of 2c per share for stock having no par value. The states of Pennsylvania and Massachusetts have also passed similar laws providing for the above taxes. Temporary Certificates. See definitive certificates. Three-Way Tickets. Tickets exchanged to cover certain Stock Exchange transactions, usually bonds, which clear through the Day Branch of the Clearing House. (See chapter under Clearing Plouse for detailed method of operation). Tickets. Slips showing details of purchases and sales which are exchanged between brokers. (See Clearing House Tickets). Time Loan. A loan having a definite date of maturity and a specified rate of interest for the entire period. Tipster. A person giving supposedly inside information re- garding a stock or the operations and prospects of a Corpo- ration. Those who are tipsters by profession and claim to be able to tell the future course of the market should be strictly avoided by investors and traders. Trader. Generally speaking an individual or broker who trades in securities, such as floor trader, trader in unlisted securities or the customer of a brokerage firm. Transfer. When a security is sent to the transfer agent of a Corporation, to be registered in a certain name it is said to be in transfer and is so recorded on the books of a brokerage concern. Securities are also counted as being in transfer when 384 WALL STREET they are sent to Corporate agents for exchange, payment, or any other reason and the record is kept as being “in transfer” until the security or its equivalent is returned to the broker. The term is also used when a customer desires to change his account from one firm to another and will give his present broker instructions to transfer his account to the other house. Trial Balance. A recapitulation of all open accounts in the bookkeeping department the debits and credits equalling each other or balancing. U Unclaimed Dividends. Items appearing in the dividend ac- count of a brokerage concern for Which no claim is made. These unclaimed dividends amount to substantial sums and accumulate as a result of the carelessness of some investors who neglect to tranfer dividend paying securities to their own name. (See Dividend claims). Unlisted Securities. Securities which have no established market on any of the Exchanges. These constitute the very large over-the-counter market and make necessary the great number of firms who trade in and make markets in unlisted securities. W Wash Sales. Sometimes called matched-sales. It is a ficti- tious sale, manipulated by broker giving another broker an order to sell stock at a certain price and when it is sold, the first broker buys it back again. Obviously there is no change in ownership but the sale is reported on the tape giving a false impression of activity and price. The same result is obtained by giving one or more brokers orders to buy at a stated price and giving a different group of brokers, orders to sell at the same price. Both practises are prohibited by the Stock Ex- changes. When Issued Contracts. On all “When Issued” trades brokers exchange forms called “When Issued Contracts which are signed by the brokers. 385 WALL STREET When Issued Trades. Under certain conditions, corpora- tions authorize securities before they are actually issued. These securities are traded in on a “When Issued” basis. Clients who purchase or sell are not required to deliver or pay for same until a date of settlement is officially announced by the Ex- change. While full payment is not required, when issued trades are subject to margin requirements the same as regular trans- actions. Wire Accounts. All out of town brokers without offices in New York City must have all their transactions executed by a New York City house. The New York house executes all orders and attends to all receipts and deliveries, and in most cases carry the securities on a marginal basis. 38G Security Symbols — New York Stock Exchan g SECURITY SYMBOLS ABBREVIATIONS STOCKS AND BONDS NEW YORK STOCK EXCHANGE Explanatory Notes of Ticker Printings List of Abbreviations for Words and Phrases Names and Abbreviations of Stocks List of Bank and Trust Co. Stocks Names and Abbreviations of Bonds Abbreviations of U. S. Government Bonds WALL STREET Notes One price following the abbreviation of a stock on the ticker tape signifies a sales of 100 shares at that price, thus : X.158%. When more than 100 shares are sold, the number of shares sold will precede the price, thus 200 shares sold is recorded as X.2.158%. In times of extreme activity, and after the opening prices on stocks have been printed on the tape, all except the final full figures may be dropped in printing quotations, i. e., in printing 100 shares of Steel at 158% it will read “X8%.” If 800 shares are sold at 158% it will read “X8S8%,” the letter “S” being inserted so that the number of shares sold will not conflict with the prices. Sales of stocks dealt in on a 10 share unit basis at Post 30 will be designated by letters SS in printing the same on tape. Odd lots (on figure line), of stocks dealt in on a 100 share unit basis will be designated by the letters SHRS when printed on tape. An offer alone, without a bid, is preceded by an O and a dot, thus: X.O.158%. A bid alone, without an offer, is followed by the letter B, thus : X.158%B. When a sale is not reported in its proper place, the price will be preceded by the abbreviation SLD, thus : X.SLD.158%. When the amount sold and the price are so nearly alike that they may be taken for two sales, the amount of the sale will be followed by the letter S thus : TCN.4S6, meaning 400 shares at 6. When an error has been made by the reporter, or in printing, the last letter or figure is repeated several times, indicating that the quotation is to be thrown out, thus: X.158%%%%%. In closing prices of active stocks, BR 40C. 6C indicates 40 is bid for an odd lot and an odd lot is offered at 46. 390 WALL STREET Three-day contracts will be printed thus : X.158V2 3 days. At fourteen minutes after Two P. M. the words “Delivery Time” will be printed on the tape, and shortly after, the lever of the instrument will give fifteen distinct beats. At the end of the fifteenth beat, it is 2:15 P. M., and the close of the recog- nized time for the settlement of transactions. Bonds of companies that have no abbreviations on the card will be abbreviated as plainly as possible, and all will be printed with the bond designation added, as per “Words and Phrases” list. A single price after the abbreviation of a bond indicates a sale of $1,000 bond at that price. Transactions in U. S. Government Bonds made in fractional variations of not less than one thirty-second of 1% are printed as follows : A sale at 99 and 13-32nds appears as 99.13. When a stock and bond have the same abbreviation, the ab- breviation is listed only under “Stock Abbreviations.” When a stock is listed bearing the same or a similar name (known as a new stock) it will be printed with the old abbre- viation followed by the letter N unless a new abbreviation is otherwise designated. 391 WALL STREET Words and Phrases Abvn. Words and Phrases A AJ ASST B C C CLT CN CT CV D DD EXT FD FPD GM GNT GTD I II III IMP IN LL MG MTG N ND NN 0 OB Pr PPr R RCT RE REG Class A Adjustment. Assented. Bonds, Class B, or (on figure line) Bid or buyer. Cash (on figure line) In closing prices (signifies Odd Lot). Collateral Trust. Consolidated, Certificates. Convertible. Debenture or Division. Delayed Delivery. Extended or Extension. Funding. Full Paid. General Mortgage. Land Grant. Guaranteed. First. Second. Third. Improvement. Income. Leased Line. Modified Guaranteed. Mortgage. New. Next Day’s Delivery. Non-voting. Offered (on figure line). Opening of Books, Preferred. Prior or Participating Preferred. Rights. Receipt. Real Estate. Registered. 392 WALL STREET s Shares (on figure line). SB Small Bonds. SF Sinking Fund. SHRS Odd Lots (100 Share Basis) (on figure line). SS Odd Lots (10 Share Basis) (on figure line). STMPD Stamped. T Terminal. TE Tax Exempt. UN Unified. WI When Issued. WW With Warrants. X Ex-coupon, dividend or interest. XW Without Warrants. Stocks A STOCKS — Arranged alphabetically according to the names of the stocks. ABI Abitibi Power & Paper Co AST Abraham & Straus, Inc AST Pr Abraham & Straus, Inc., Pfd AE Adams Express Co ALL Adams-Mills Corp RX Advance-Rumely Co AUA Ahumada Lead Co ADN Air Reduction Co AWY Air-Way Elec. Appliance Corp AJ Ajax Rubber Co., Inc ALM Alabama & Vicksburg Ry. Co JU Alaska Juneau Gold Mining Co AQS Albany & Susquehanna R. R ABP Albany Perf. Wrap. Paper Co AYY Alleghany Corporation AY Allegheny & Western Ry. (Gtd) ANR Alliance Realty Corp ACD Allied Chemical & Dye Corp AH Allis Chalmers Mfg. Co 393 WALL STREET ALR ARC AGR AFW AFW Pr AFW Pr AFW Pr ABN ABN-Pr ABS BOS ABE ABE Pr BOV BOV Pr AC AF ACN ACJ ACL ACF AEN AMU AMX AHS HI AHO IS AL AFG AFG Pr ALO AFX AFX Pr AMM AGN Pr AMP AMP Pr AOW ADT ADT Pr ARU Amalgamated Leather Co’s., Inc Amerada Corp Amer. Agricultural Chem. Co American & Foreign Power Co Am. & Foreign Pwr. Co., $6 Pfd Am. & Foreign Pwr. Co., Pfd Am. & For. Pwr. Co., $7 2nd Pfd American Bank Note Co American Bank Note Co., Pfd American Beet Sugar Co American Bosch Magneto Corp American Brake Shoe & Foundry Am. Brake Shoe & Fdy. Co., Pfd Amer. Brown Boveri Elec. Corp Am. Brown Boveri. El. Corp., Pfd American Can Co American Car & Foundry Co American Chain Company American Chicle Co American Coal Co. of Allegany American Com. Alcohol Corp American Encaustic Tiling Co. (Ltd.) . . . Amer.-European Securities Co American Express Co American-Hawaiian Steamship American Hide & Leather Co American Home Products Corp American Ice Co American International Corp Am.-La France & Foamite Corp Am.-La France & Foamite Corp., Pfd. . . . American Lomotive Co Amer. Mach. & Foundry Amer. Mach. & Foundry, Pfd American Metal Co., Ltd Amer. Natural Cas Corp. Pfd American Piano Co American Piano Co., Pfd American Power & Light Co Amer. Rad. & Standard Sanitary Corp. . Amer. Rad. & Stand. Sanitary Corp., Pfd. American Republics Corp 394 AGM AEZ AMZ ACS ASU AH SNU SNU Pr FJ FJ Pr ASC ASR AMS ACE ATT AT ATB TY TY Pr AWW WY AW ZA C AWC ACC ADE AN ADD ADD Pr AMD AM ACT ART ARR ARR Pr APP DG ADO A AX AG Amer. Rolling Mill Co. (The) American Safety Razor Corp Amearican Seating Co Amer. Ship & Commerce Corp American Shipbuilding Co. Amer. Smelting & Refining Co American Snuff Co American Snuff Co., Pfd American Steel Foundries . . . American Steel Foundries, Pfd American Stores Company .... American Sugar Refining Co Amer. Sumatra Tobacco Corp American Telegraph & Cable Co American Tel. & Tel. Co American Tobacco Co American Tobacco “B” Stock American Type Founders . . American Type Founders, Pfd Amer. Water W. & El. Co., Inc American Woolen Co. of Mass American Writing Paper Co. . . Amer. Zinc, Lead & Smelting Co Anaconda Copper Mining Co Anaconda Wire & Cable Co Anchor Cap Corp Andes Copper Mining Co. . . Ann Arbor R. R. Co Archer-Daniels-Midland .... Archer-Daniels-Midland, Pfd Armour & Co., of Delaware Amour & Co. (Illinois) . . Arnold Constable Corp. . . Art Metal Construction Co. Artloom Corporation Artloom Corporation, Pfd. Assoc. Apparel Industries, Inc Associated Dry Goods Corp Associated Oil Co Atchison, Topeka & Santa Fe Ry Atlantic Coast Line R. R Atl. Gulf & W. Indies S. S. Lines WALL STREET AFI APW APW Pr AEO AAC ANO ACR AU AUZ A VC B B Pr BO BGPr BNE BNK Pr BER BLR BLR Pr BDL BY BY Pr BCD BRY BCH BNU BV BLW BEX BST BS BBL BBL Pr SBM Pr BHL BM BP BDO BGW Atlantic Refining Co Atlas Powder Co Atlas Powder Co., Pfd Atlas Tack Corp Auburn Automobile Co Austin, Nichols & Co Austrian Credit- Anstalt Auto Sales Corp Auto-Strop Safety Razor Co., Inc. Aviation Corp. (The) B Baldwin Loco. Works (The) .... Baldwin Loco. Works (The), Pfd. Baltimore & Ohio Bamberger (L.) & Co., Pfd Bangor & Aroostook R. R Bangor & Aroostook R. R., Pfd. . Barker Bros. Corp Barnet Leather Co Barnet Leather Co., Pfd Barnsdall Corporation Bayuk Cigars Bayuk Cigars, Pfd Beacon Oil Co Beatrice Creamery Co Beech Creek R. R Beech-Nut Packing Belding-Heminway Co Belgian National Rys Bendix Aviation Corp Best & Co., Inc Bethlehem Steel Bloomingdale Bros., Inc Bloomingdale Bros., Inc., Pfd. . . . Blumenthal & Co., (Sidney), Pfd. Bohn Aluminum & Brass Corp. . . . Bon Ami Co. (The) Booth Fisheries Co Borden Company (The) Borg-Warner Corp 396 WALL STREET BMR Boston & Maine R. R BTY Botany Consolidated Mills, Inc BGG Briggs & Stratton Corp BGI Briggs Manufacturing Co BMY Bristol-Myers Co BMP British Empire Steel BKM Brockway Motor Truck Corp BQT Brooklyn & Queens Trans. Corp BE Brooklyn Edison Co BMT Br’klyn-Manhattan Transit Corp BU Brooklyn Union Gas BW Brown Shoe Co BWPr Brown Shoe Co., ( 7 % Pfd.) BCC Brunswick-Balke-Collender Co BK Brunswick Term. & Ry. Sec. Co BEY Bucyrus-Erie Co., Com BEY Bucyrus-Erie Co., Conv. Pref BEY Pr Bucyrus-Erie Co., Pfd BFQ Buffalo & Susq. R. R BFQ Pr Buffalo & Susq. R. R., Pfd BR Buffalo, Roch. & Pitts. Ry BUD Bullard Company (The) BB Burns Bros., (“A & B”) BB Pr Burns Bros., Pfd BGH Burroughs Adding Machine Co BHB Pr Bush Terminal Bldgs. Co., Pfd BH Bush Terminal Co BHD Bush Term. Co. Deb. Stock BT Butte & Superior Mining BC Butte Copper & Zinc Co BCK Butteriek Co ABY Byers Co. (A. M.) ABYPr Byers Co. (A. M.) Pfd BYC By-Products Coke Corp C OFF California Packing Corp CPU California Petroleum Corp CIM Callahan Zinc-Lead Co CMM Calumet & Arizona Mining Co CAH Calumet & Hecla Cons. Cop. Co 397 WALL STREET CWT DGL CSA CP CAM CCL CTM CVD CLO CEG CES CES Pr CKO JC CTY CTY Pr CDP CRT CHC CO CHK ALT CE NW GW CIL Pr ST CGG RI OM TXY CIK CDI CHL CHT K CSC Pr CFY CFY Pr CNV CSS CSS Campbell, Wyant & Cannon Foundry Co Canada Dry Gingerale, Inc Canada Southern Ry Canadian Pacific Ry. Co Cannon Mills Co Carolina Clinchfield & Ohio Ry Case (J. I.) Co Cavanaugh-Dobbs, Inc Celotex Co. (The) Central Aguirre Associates Central Alloy Steel Corp Central Alloy Steel Corp., Pfd Central Coal & Coke Co Central R. R. of New Jersey Century Ribbon Mills, Inc Century Ribbon Mills, Inc., Pfd Cerro de Pasco Copper Corp Certain-teed Products Corp Checker Cab Mfg. Corp Chesapeake & Ohio Chesapeake Corp. (The) Chicago & Alton R. R. Co Chicago & Eastern Illinois R. R Chicago & Northwestern Chicago Great Western Chi., Ind. & Louisville Ry., Pfd Chi., Mil., St. Paul & Pac. R. R Chicago Pneumatic Tool Co Chi. Rock Island & Pacific Ry Chi., St. Paul, Minn. & Omaha Chicago Yellow Cab Chickasha Cotton Oil Co Childs Co Chile Copper Co Christie, Brown & Co., Ltd Chrysler Corporation Cin., Sandusky & Cleve., Pfd City Ice & Fuel Co City Ice & Fuel Co., Pfd City Investing Co City Stores Co., Common City Stores Co., Class “A” 398 WALL STREET PTT Cleveland & Pittsburgh, Gtd. . : PTT SPL Cleveland & Pitts. Special Gtd CC Cleve., Cin., Chic. & St. L CC Pr Cleve., Cin., Chic. & St. L., Pfd CLU Cluett, Peabody & Co CLU Pr Cluett, Peabody & Co., Pfd KO Coca-Cola Co KOC Coca-Cola International Corp CK Collins & Aikman Corp CX Colorado & Southern Ry CX Pr Colorado & Southern Ry., Pfd CF Colorado Fuel & Iron Co CF Pr Colorado Fuel & Iron Co., Pfd CG Columbia Gas & Electric Corp CGH Columbia Graphophone Co., Ltd CBN Columbian Carbon Company CMO Commercial Credit Co CMO Comm. Credit Co., Cl. A. Conv CMO Pr Comm. Credit Co., 6Y 2 % Pfd CMO Pr Comm. Credit Co., 7% 1st Pfd CMO Pr Comm. Credit Co., 8% Pfd. B CIT Comm. Inv. Tr. Corp. (Com.) CITPr Com. Inv. Tr. Corp. ( 6 y 2 % Pfd.) CITPr Comm. Inv. Tr. Corp. (7% Pfd.) CV Commercial Solvents Corp CMP Commonwealth Power Corp CDD Conde Nast Publications, Inc COG Congoleum-Nairn, Inc CNG Congress Cigar Co., Inc CLY Conley Tinfoil Corporation CRW Connecticut Ry. & Lighting Co CGR Consolidated Cigar Corp CGRPr Consolidated Cigar Corp., 6 ^ 2 % Pfd. (w w.) CGRPr Consolidated Cigar Corp., 6 V 2 % Pfd. (x. w.) CGRPr Consolidated Cigar Corp., 7% Pfd CFM Cons. Film Industries, Inc G Consolidated Gas Co CCU Consolidated Railroads of Cuba CTX Consolidated Textile Corp CNR Container Corp. of America Cl Continental Baking Corp CTB Continental Bank of N. Y. (The) 399 WALL STREET CH CH Pr CIS CMR CLL CFG CFG Pr COT CRX CR CCK CWW Pr CEZ XA CS CUB CBR Pr CSU CSUPr DMS CUX CPC CUZ cwz CHS Pr CHS Pr CEH CDF D DB DEM DER Pr DH DL DGR DET DTE DHS DU Continental Can Co Continental Can Co., Pfd Continental Insurance Co Continental Motors Continental Oil Co. of Del Corn Products Refining Co Corn Products Refining Co., Pfd. . Coty, Inc Crex Carpet Co Crosley Radio Corp. (The) Crown Cork & Seal Co., Inc Crown Willamette P. Co., Pfd Crown Zellerbach Corp Crucible Steel Co. of America .... Cuba Cane Sugar Co Cuba Company (The) Cuba Railroad Co., Pfd Cuban-American Sugar Co Cuban-American Sugar Co., Pfd. . . Cuban-Dominician Sugar Corp. . . . Cudahy Packing Co. (The) Curtis Publishing Co. The) ( Curtiss Aerop. & Motor Co., Inc. . . Curtiss- Wright Corp Cushman’s Sons, Inc. (7% Pfd.) . . Cushman’s Sons, Inc. ($8 Pfd.) Cutler-Hammer, Inc Cuyamel Fruit Company D Davison Chemical Co De Beers Consolidated Mines Debenhams Securities, Ltd Deere & Co., Pfd Delaware & Hudson Co Delaware, Lack. & Western R. R. Denver & Rio Grande West. R. R. . Detroit & Mackinac Ry Detroit Edison Co Detroit, Hillsdale & S. W. Ry Detroit United Ry 400 WALL STREET DRS Devoe & Reynolds, Inc DRS Pr Devoe & Reynolds, Inc., Pfd DN Diamond Match Co DO Dome Mines Limited DOS Dominion Stores Limited DRU Drug, Inc DS Duluth, South Shore & Atl. Ry DX Duluth Superior Traction DHI D unhill International, Inc DPS Duplan Silk Corp DD Du Pont de Nemours & Co. (E. I.) DQU Duquesne Light Company DHO Durham Hosiery Mills DHO Pr Durham Hos. Mills, (7% Pfd.) E ER Eastern Rolling Mill Co EK Eastman Kodak Co. of N. J EK Pr Eastman Kodak Co. of N. J., Pfd ENX Eaton Axle & Spring Co EGS Eitingon Schild Co., Inc ELO Electric Auto-Lite Co. (The) ELO Pr Electric Auto-Lite Co. (The), Pfd ELB Electric Boat Co EL Electric Power & Light Corp EL El. Pwr. & Lt. Corp., (allot, ctfs full paid) EL El. Pwr. & Lt. Corp. (allot ctfs 50% paid) EL Pr Electric Pwr. & Lt. Corp., Pfd EG Electric Storage Battery EH Elk Horn Coal Corp EH Pr Elk Horn Coal Corp., Pfd EGM Emerson Brantingham EMP Emporium Capwell Corp. (The) EJ Endicott Johnson EPU Engineers Public Service Co EQ Equitable Office Bldg. Corp EQ Pr Equitable Office Bldg. Corp., Pfd EP Erie & Pittsburgh R. R E Erie R. R EU Eureka Vacuum Cleaner Co EVY Evans Auto Loading Co. (The) EXY Exchange Buffet Corp 401 WALL STREET TF TF Pr FI FI Pr FKM FKM Pr FHP FLT FLT Pr FS FMT FWS FPX FV FFL FFL Pr FST FK FK Pr FK Pr FK Pr F FLO FLZ FWC FO FOX FIS Pr FT FL GRR GAC GRD GT AS GBG Pr GLZ F Fair (The) Fair (The), Pfd Fairbanks Co Fairbanks Co., Pfd Fairbanks, Morse & Co Fairbanks, Morse & Co., Pfd. . . Fashion Park Associates, Inc. . . . Federal Light & Traction Federal Light & Traction, Pfd. . Federal Mining & Smelting Federal Motor Truck Co Federal Water Service Corp. . . . Fidel.-Phen. Fire Ins. Co. of N. Y. Fifth Avenue Bus Sec. Corp. . . . Filene’s (Wm.) Sons Co Filene’s (Wm.) Sons Co., Pfd. . First National Stores, Inc Fisk Rubber Co Fisk Rubber Co., 1st Pfd Fisk Rubber Co., Conv. 1st Pfd. . Fisk Rubber Co., 2nd Pfd Fleischmann Company Florsheim Shoe Co. (The) Follansbee Brothers Co Foster Wheeler Corp Foundation Company (The) . . . Fox Film Corporation Franklin Simon Co., Pfd Freeport Texas Co Fuller (Geo. A.) & Co G Gabriel Snubber Mfg. Co. (The) Gamewell Co. (The) Gardner Motor Co., Inc General Amer. Tank Car. Corp. . General Asphalt Co General Baking Co., Pfd General Bronze Corp 402 WALL STREET GGN GY GY Pr GL GF GGS GGS Pr GIP GIS GM GMD GYZ GPV GRS GRS Pr GRX GIL GI GLN GLN P. Pr GGO GK GSX GG GOR GHM GHM Pr GUC GHR GB GNW GUX GRC GTY OR GQ GSW GSW Pr GN GNP GGZ General Cable Corp General Cigar Co General Cigar Co., Pfd . General Electric General Foods Corp General Gas & Electric Corp. (of Del.), (Class A and B) General Gas & Electric Corp. (of Del.), Pfd. . . General Ice Cream Corp General Mills, Inc General Motors General Motors, Debenture Stock General Outdoor Adver., Inc General Public Service Corp General Railway Signal General Railway Signal, Pfd General Refractories Co Gillette Safety Razor Co Gimbel Bros., Inc Glidden Company Glidden Company, Prior Pfd Gobel (Adolph), Inc Gold Dust Corp Gold & Stock Telegraph Co Goodrich Co. (B. F.) Goodyear Tire & Rubber Co Gotham Silk Hosiery Co., Inc Goth. S. Hos., Pfd. (without Warr.) Gould Coupler Co. (The) Graham-Paige Motors Corp Granby Cons. Min., Smelt. & Pw Grand (F. & W.) 5-10-25c Stores Grand Union Co. (The) Granite City Steel Co Grant (W. T.) Co Great Northern Iron Ore Prop Great Northern Ry., Pfd Great Western Sugar Co Great Western Sugar Co., Pfd Green Bay & Western Ry Greene Cananea Copper Co Grigsby-Grunow Co 403 WALL STREET GS GS Pr GU GJ GJ Pr HWA HHN HMW Pr HNA Pr HKM HRT HN HN Pr HIP HYB GH GH Pr HPC HSY HV HOO HLN HLL HM HH HOF HOU HO HW HX HMT H IL IL.LL IPX IMY Guantanamo Sugar Co Guantanamo Sugar Co., Pfd. . . . Gulf, Mobile & Northern Gulf States Steel Co Gulf States Steel Co., Pfd H Hackensack Water Co Hahn Department Stores, Inc. . . Hamilton Watch Co., 6 % Pfd. . . Hanna Company, Pfd Harbison- Walker Refrac. Co. . . . Hartman Corp Havana Electric Railway Co. . . . Havana Elec. Ry. Co., 6% Pfd. . . Hawaiian Pineapple Co., Ltd. . . . Hayes Body Corp Helme Co. (G. W.) Helme Co. (G. W.), Pfd Hercules Powder Co Hershey Chocolate Corp Hocking Valley Ry Hoe (R.) & Co Holland Furnace Co Hollander & Son (A.), Inc Homestake Mining Houdaille-Hershey Corp Household Finance Corp Household Products, Inc Houston Oil Co Howe Sound Co Hudson & Manhattan R. R Hudson Motor Car Co Hupp Motor Car Corp I Illinois Central R. R Illinois Cent. R. R. Leased Lines Independent Oil & Gas Co Indian Motorcycle Co 404 WALL STREET IMY Pr IRR ILR IR IR Pr ILN INS IRT IRU IGL IMN ICM IN HR IPH ILM MAR N IP IP.A. IP.B. IP.C. IP. Pr.N IKN IKN Pr IRC IRC Pr ILS ISS INR INR Pr ITT ISD ISD Pr ISD Pr IRY INQ IA IRO ICR ICR Pr Indian Motorcycle Co., Pfd Indian Refining Co Industrial Rayon Corp Ingersoll-Rand Co Ingersoll-Rand Co., Pfd Inland Steel Company Inspiration Cons. Cop. Co Interboro Rapid Transit Co Intercontinental Rubber Co International Agr. Corp Internatl. Business Mach. Corp International Cement Corp International Comb. Eng. Corp International Harvester Co Internat.-Hydro-Electric System International Match Corp Int. Mercantile Marine Co Inti. Nickel Co. of Can., Ltd International Paper Co International Paper & Pwr. Co. (Class A) International Paper & Power Co. (Class B) International Paper & Pwr. Co. (Class C) International Paper & Pwr. Co. (Pfd.) Inti. Printing Ink Corp. (The) Inti. Printing Ink Corp. (The) Pfd Inti. Rys. of Cen. Anier Inti. Rys. of Cen. Amer., Pfd International Salt Co International Shoe Co International Silver Co International Silver Co. Pfd International Tel. & Tel. Corp Interstate Dept. Stores, Inc Interstate Dept. Stores, Inc. Pfd. (x. w.) Interstate Dept. Stores, Inc., Pfd. (w. w.) Intertype Corporation Investors Equity Co., Inc Iowa Central Ry Iron Products Corp Island Creek Coal Co Island Creek Coal Co., Pfd 405 WALL STREET J •JW Jewel Tea Co JMP Johns-Manville Corp JMP Pr Johns-Manville Corp., Pfd JLO Joliet & Chicago R. R JOT Jones Bros. Tea Co JL Pr Jones & Laughlin Steel, Pfd JJ Jordan Motor Car Co K KLT Kansas City Power & Light Co KSU Kansas City Southern Ry KKN Kaufmann Dept. Stores, Inc JKS Kayser & Co. (Julius) KLO Keith-Albee-Orpheum Corp KK Kelly-Springfield Tire Co KK Pr Kelly-Springfield Tire Co. 6 % Pfd KKPr Kelly-Springfield Tire Co. 8 % Pfd KW Kelsey-Hayes Wheel Corp KLV Kelvinator Corp KLL Pr Kendall Co. (The) Pfd KN Kennecott Copper Corp KMB Kimberly-Clark Corp KNX Kinney, (G. R.) & Co KNX Pr Kinney, (G. R.) & Co., Pfd KOR Kolster Radio Corp KKR Kraft-Phoenix Cheese Corp KG Kresge Co. (The S. S.) KG Pr Kresge Co. (The S. S.) Pfd KDS Kresge Department Stores KDS Pr Kresge Department Stores, Pfd KS Kress & Co. (S. H.) KRT Kreuger & Toll Co KR Kroger Gro. & Baking Co. (The) BKU Kuppenheimer (B.) & Co L LG Laclede Gas Light Co. of St. Louis LG Pr Laclede Gas Light Co. of St. Louis, Pfd. LGO Lago Oil & Transport Corp 406 WALL STREET LAM Lambert Company (The) LR Lee Rubber & Tire Corp LPT Lehigh Portland Cement Co LPT Pr Lehigh Portland Cement Co., Pfd, LEH Lehigh Valley Coal Corp LV Lehigh Valley R. R LNP Lehn & Fink Products Co LBO Libbey-Owens Glass Co LM Liggett & Myers Tobacco LMB Liggett & Meyers, “B” Stock .... LMW Lima Loco. Works LB Link-Belt Company LQT Liquid Carbonic Corp. (The) . . . LW Loew’s Incorporated LP Loft Incorporated LQ Long-Bell Lumber Corp LO Loose-Wiles Biscuit Co LO Pr Loose-Wiles Biscuit Co., Pfd LOR Lorillard Co. (P.) LOR Pr Lorillard Co. (P.), Pfd LL Louisiana Oil Refining Corp. . . . LL Pr Louisiana Oil Refg. Corp., Pfd. . . LN Louisville & Nashville LOU Louisville Gas & Electric Co. . . . LMS Ludlum Steel M MAF MacAndrews & Forbes Co MAF Pr MacAndrews & Forbes Co., Pfd. MQ Mack Trucks, Inc MK Mackav Companies MZ Macy (R. H.) & Co., Inc MAQ Madison Square Garden Corp. . MMX Magma Copper Co MAH Mahoning Coal Railroad Co. . . HK Mallinson (II. R.) & Co HK Pr Mallinson (H. R.) & Co., Pfd. . MNU Manati Sugar Co MNU Pr Manati Sugar Co., Pfd MB Mandel Brothers, Inc MSY Manhattan Electrical Supply Co 407 WALL STREET MAN Manhattan Railway MAN Manhattan Railway, Gtd. (Old) MT Manhattan Shirt Co MT Pr Manhattan Shirt Co., Pfd MAB Maracaibo Oil Exploration Co MRR Market Street Railway MR Marlin-Rockwell Corp MMC Marmon Motor Car Co MRT Martin-Parry Corp AKL Mathieson Alkali Works AKL Pr Mathieson Alkali Works, Pfd MA May Department Stores Co MYG Maytag Co. (The) MW McCall Corporation MRY McCrory Stores Corp MRY Pr McCrory Stores Corp., Pfd MRY McCrory Stores Corp. “B” MCG McGraw-Hill Publishing Co., Inc MTY McIntyre Porcupine Mines MV McKeesport Tin Plate Co. (The) MCK McKesson & Robbins, Inc MLL McLellan Stores Co MES Melville Shoe Corporation MGX Mengel Company (The) MGXPr Mengel Company (The), Pfd MGL Metro-Goldwyn Pictures MNO Mexican Northern Ry MN Mexican Petroleum Co., Ltd MSX Mexican Seaboard Oil MMP Miami Copper Co MC Michigan Central R. R MCH Michigan Steel Corp. MPZ Mid-Continent Petroleum Corp MSO Middle States Oil MPO Midland Steel Products Co MRC Miller Rubber Co. (The) MY Pr Milwaukee El. Ry. & Li. Co., Pfd MHW Minn.-Honeywell Regulator Co MMW Minneapolis-Moline Power Implement Co MS Minneapolis & St. Louis R. R MSM Minn., St. P. & S. S. Marie Ry MSM LL Minn., St. P. & S. S. M. L. Lines 408 WALL STREET MSM Pr Minn., St. P. & S. S. M. Ry., Pfd. . KT Missouri-Kansas-Texas MOP Missouri Pacific R. R M & B Pr Mobile & Birmingham R. R., Pfd. MOK Mohawk Carpet Mills, Inc M Montgomery Ward & Co MOO Moon Motor Car Co MOL Morrell (John) & Co., Inc MOS Morris & Co., Ltd., Inc. (Philip) . . ME Morris & Essex R. R MOR Mother Lode Coalition Mines Co. . MPX Motion Picture Capital Corp MQU Moto Meter Gauge Equip. Corp. . MPS Motor Products Corp MRW Motor Wheel Corporation MNS Mullins Manufacturing Corp MNS Pr Mullins Mfg. Corp., Pfd MUN Munsingwear, Inc MUY Murray Corporation of America . . MYR Myers (F. E.) & Bro. Co. (The) . N NSS Nash Motors Co CHA Nashville, Chattanooga & St. L. . . NCM National Acme Co NAS National Air Transport, Inc NBH National Bellas Hess Co., Inc. . . BI National Biscuit NCR National Cash Register Co. (The) NPT National Dairy Products Corp. . NX National Dept. Stores, Inc NX Pr National Dept. Stores, Inc., Pfd. NAD National Distillers Prod. Corp. . . EGK National Enameling & Stamping LT National Lead Co LT Pr National Lead Co., Pfd. “A” LT Pr National Lead Co., Pfd. “B”. . . . NPL National Power & Light Co NRC National Radiator Corp MX National Rys. of Mexico NSC National Supply Co 409 WALL STREET NSC Pr NSU NTY NV NOX NEO HAR AB CN NKP BK NL V OW NRY Pr NST NSMPr NSX NNK NFK NFK Pr NS NA NAE NGL NNX NP NWT NRT NET Pr NNY OWY OWY Pr OF BUZ OPS OPX OT OT Pr National Supply Co., Pfd National Surety Co National Tea Company Nevada Consolidated Copper New Orleans, Texas & Mexico Ry. . Newport Co. (The) N. Y. & Harlem New York Air Brake Co N. Y. Central N. Y., Chicago & St. Louis New York Dock Co N. Y., Lackawanna & Western .... N. Y., N. H. & Hartford R. R. Co. . . N. Y., Ontario & Western N. Y. Railway Corp., Pfd N. Y. State Railways N. Y. Steam Corporation, Pfd Newton Steel Co. (The) Nickel Holdings Corp Norfolk & Western Ry. Co Norfolk & Western Ry. Co., Adj. Pfd. Norfolk Southern R. R North American Co North American Edison Co North German Lloyd of Bremen . . . Northern Central Ry Northern Pacific Northwestern Telegraph Norwalk Tire & Rub. Co Norwalk Tire & Rub. Co., Pfd Nunnally Company 0 Oil Well Supply Company Oil Well Supply Company, Pfd Oliver Farm Equipment Co Omnibus Corporation (The) Oppenheim, Collins & Co., Inc Orpheum Circuit Otis Elevator Co Otis Elevator Co., Pfd 410 WALL STREET OST Otis Steel Co OTU Outlet Company (The) OTU Pr Outlet Co. (The), Pfd. . OB Owens-Illinois Glass Co P PX Pacific Coast Co PXPr Pacific Coast Co. (1st Pfd.) PXPr Pacific Coast Co. (2nd Pfd.) PCG Pacific Gas & Elec. Co PLT Pacific Lighting Corp PFS Pacific Mills PY Pacific Oil PAC Pacific Tel. & Tel. Co PAK Packard Motor Car Co PP Pan-American Pet. & Trans. Co. . . . PPB Pan- Am. Pet. & Trans., Class B . . . . PPW Pan-Amer. Western Pet. Co PDF Panhandle Prod. & Refining Co. . . . FP Paramount Famous Lasky Corp. . . PKT Park & Tilford PUC Park Utah Cons. Mines Co PTH Pathe Exchange, Inc PAE Patino Mines & Enterprises PSS Peerless Motor Car Corp PFK Penick & Ford, Ltd., Inc PFK Pr Penick & Ford, Ltd., Inc., Pfd PVX Pennsylvania Coal & Coke Corp. . . PXC Penna.-Dixie Cement Corp PA Pennsylvania R. R PO Peoples Gas Lt. & Coke Co PE Peoria & Eastern Rv PQ Pere Marquette R. R PQR Pere Marquette, Prior Pfd PET Pet Milk Co PDO Phelps Dodge Corp PH Philadelphia Co PH Pr Philadelphia Co. (5% Pfd.) PHPr Philadelphia Co. (6% Pfd.) PV Philadelphia Rapid Transit PRC Phila. & Reading Coal & Iron Corp 411 WALL STREET PJ Phillips- Jones Corp PJ Pr Phillips- Jones Corp., Pfd P Phillips Petroleum Co PXY Phoenix Hosiery Co PXY Pr Phoenix Hosiery Co., Pfd PZ Pierce Arrow Motor Car Co POL Pierce Oil Corp PPX Pierce Petroleum Corp PSY Pillsbury Flour Mills, Inc PRL Pirelli Co. of Italy PW Pittsburgh & West Va. Ry PT Pitts., Cin., Chic., & St. L. R. R PC Pittsburgh Coal Co. (of Penna.) FW Pitts., Ft. Wayne & Chicago PMY Pitts., McKeesport & Yough PIT Pittsburgh Screw & Bolt Corp PG Pr Pittsburgh Steel Co., Pfd PPT Pittsburgh Term. Coal Corp PPT Pr Pittsburgh Term. Coal Corp., Pfd PYA Pr Pitts., Youngstown & Ash., Pfd POR Poor & Company PRT Porto Rican-Amer. Tobacco Co PST Postal Telegraph & Cable Corp PF Prairie Oil and Gas Co. (The) PPI Prairie Pipe Line Co. (The) PSL Pressed Steel Car Co PGM Procter & Gamble Co. (The) PFN Producers & Refiners Corp PFN Pr Producers & Refiners Corp., Pfd PYY Pro-phy-lac-tie Brush Co PUB Public Service Corp. of N. J PEG Public Service Electric & Gas Co PU Pullman Inc PQS Punta Alegre Sugar Co PUY Pure Oil Co PUY Pr Pure Oil Co., Pfd PTY Purity Bakeries Corp R R Radio Corporation of America RKK Radio-Keith-Orpheum Corp 412 WALL STREET RSY ARX RDM RAY RDG RSH RSH Pr RIS RR REM Pr RNS RY RB RBC RSA RJR RJR RWE RIL RGO RDL ROS RBP RD RV SAF SAF Pr SAF Pr JO FN SS SA SHO SHO Pr SPP SB SVE S SNI R. R. Securs. Co., 111. Cent. Stock Railway & Express Co Rand Mines Raybestos-Manhattan, Inc Reading Co Real Silk Hosiery Mills, Inc Real Silk Hosiery Mills, Inc. Pfd. Reis & Co. (Robert) Remington Rand, Inc Remington Typewriter Co., Pfd. . Rensselaer & Saratoga R. R Reo Motor Car Co Republic Brass Corp Republic Iron & Steel Reynolds Spring Co Reynolds (R. J.) Tobacco Co. . . Reynolds (R. J.) Tob. Co. (“B”). Rhine-Westphalia El. Pwr. Corp. Richfield Oil Co. of California . . . Rio Grande Oil Co Ritter Dental Mfg. Co., Inc. . . . Rossia Insurance Co. of America Royal Baking Powder Co Royal Dutch, N. Y. Shares Rutland R. R S Safeway Stores, Inc Safeway Stores, Inc., 6% Pfd. . Safeway Stores, Inc., 7% Pfd. . St. Joseph Lead Co St. Louis-San Francisco R. R. St. Louis & Southwestern R. R. . Savage Arms Schulte Retail Stores Corp Schulte Retail Stores Corp., Pfd, Scott Paper Co Seaboard Air Line Seagrave Corporation (The) . . . Sears, Roebuck & Co Second Natl. Investors Corp. . . . 413 WALL STREET SEN Seneca Copper Mining Co SVL Servel, Inc SSH Sharon Steel Hoop Co SDH Sharp & Dohme, Inc FHE Shattuck Co. (Frank G.) SH Shell Transp. & Trad. Co., Ltd. . SUX Shell Union Oil Corp SHU Shubert Theatre Corporation . . SIM Simmons Company SV Simms Petroleum Co SC Sinclair Consol. Oil Corp SAV Sixth Ave. R. R. SYE Skelly Oil Co. SLS Sloss Sheffield Steel & Iron .... SNR Snider Packing Corp SO Solvay American Inv. Corp. SCE Southern California Edison Co. SD Southern Dairies, Inc SX Southern Pacific SZ Southern Railway Co SRM Southern Ry. (Mobile & 0. Ctfs.) PSU South Porto Rico Sugar PSU Pr South Porto Rico Sugar, Pfd. . SDG Spalding (A. G.) & Bros SDGPr Spalding (A. G.) & Bros. Pfd. . SCH Spang, Chalfant & Co., Inc SCH Pr Spang, Chalfant & Co., Inc., Pfd. SKW Sparks-Withington Co. (The) . . SST Spear & Company SE Spencer Kellogg & Sons, Inc.. . . SSY Spicer Mfg. Corp SMS Spiegel, May, Stern Co., Inc. . . . SBX Standard Brands Incorporated . SDT Standard Com. Tobacco Co. SG Standard Gas & Eleetric Co. . . . STD Standard Investing Corp SM Standard Milling SM Pr Standard Milling, Pfd SCD Standard Oil Co. of California . J Standard Oil Co. of New Jersey NY Standard Oil Co. of N. Y SGL Standard Plate Glass Co 414 WALL STREET SGL Pr Standard Plate Glass Co., Pfd STA Stanley Company of America SLG Sterling Securities Corp STX Stewart- Warner Corp SW Stone & Webster, Inc STU Studebaker Corp STU Pr Studebaker Corp., Pfd SUB Submarine Boat Corp SUN Sun Oil Company SUN Pr Sun Oil Company, Pfd SI Superior Oil SSU Superior Steel SWA Sweets Co. of America, Inc SYZ Symington Company (The) T TZ Telautograph Corporation TCC Tennessee Copper & Chem. Corp. . . T Texas & Pacific Ry TX Texas Corp. (The) TG Texas Gulf Sulphur Co TES Texas Pacific Coal & Oil Co TXL Texas Pacific Laud Trust (New) . . TXL Texas Pacific Land Trust (Old) . . . TCH Thatcher Manufacturing Co TAV Third Ave. Ry THM Thompson (John R.) Co TV Tide Water Oil Co TV Tide Water Asso. Oil Co. (New) . . . TDX Timken-Detroit Axle Co. (The) . . . TKR Timken Roller Bearing Co TB Tobacco Products Corp TBS Tobacco Prod. (Div. Ctfs.) TP Toledo, Peoria & Western R. R. TD Toledo Railways & Light Co TON Transcontinental Oil Co TU Transue & Williams Stl. Frg. Corp TCO Trico Products Corp TTC Truax-Traer Coal Co TUX Truscon Steel Co TWO Twin City Rap. Tr. Co TWCPr Twin City Rap. Tr. Co., Pfd 415 WALL STREET U UNX Underwood Elliott Fisher Co. . . UNX Pr Underwood Elliott Fisher, Pfd. . BP Union Bag & Paper Corp UNO Union Carbide & Carbon Corp. . UCL Union Oil of California UP Union Pacific R. R. Co UP Pr Union Pacific R. R. Co., Pfd. . . . UTX Union Tank Car UAF United Aircraft & Trans. Corp. . UBC United Biscuit Co. of America . UBP United Business Publishers, Inc. UCB United Carbon Co UO United Cigar Stores U United Corporation (The) UDY United Dyewood UEL United Elec. Coal Companies . . . UF United Fruit Co UGI United Gas Imp. Co. (The) .... PB United Paperboard UW United Piece Dye Works (The) . UM U. S. Distributing Corp USX U. S. Express Co UFO U. S. Foreign Securities Corp. . . UFG U. S. Freight Co HMY U. S. Hoffman Machinery Corp. UD U. S. Industrial Alcohol Co UX U. S. Leather Co. (The) CJ U. S. Pipe & Foundry Co UZ U. S. Realty & Improvement . . . RU U. S. Rubber Co UV U. S. Smelting, Refining & Min. . X U. S. Steel X Pr U. S. Steel, Pfd UB United States Tobacco Co UB Pr U. S. Tobacco Co., Pfd UVV Universal Leaf Tobacco Co., Inc. UVV Pr Univer. Leaf Tob. Co., Inc., Pfd. UVP Pr Universal Pictures Co., Inc., Pfd. UVX Universal Pipe & Radiator Co. . UVX Pr Univ. Pipe & Radiator Co., Pfd. 416 WALL STREET UE ULA VAD VA VRT VRT Pr VIK VKS VC VE VK VK Pr VX WA WXV WAG WAL WD WD WD Pr WBP QW WAR WAR Pf WFP WBS WF WNO WEP WPP Pr WYY WM WR W WKM wx Utah Copper Utilities Power & Light Corp V Vadsco Sales Corp Vanadium Corp. of Amer Van Raalte Co Van Raalte Co., Pfd Vick Chemical Co Vicksburg, Shreve. & Pac. Ry. Co Virginia-Carolina Chemical Virginia Electric & Power Virginia Iron, Coal & Coke Virginia Iron, Coal & Coke, Pfd. . Vulcan Detinning Co W Wabash Ry Waldorf System, Inc Walgreen Company Walworth Company Ward Baking Corp. (Class A) . Ward Baking Corp. (Class B) . Ward Baking Corp., 7 % Pfd. . Warner Bros. Pictures Co Warner-Quinlan Co Warren Brothers Co Warren Brothers Co., Pfd Warren Foundry & Pipe Corp. . Webster Eisenlohr, Inc Wells Fargo & Co Wesson Oil & Snowdrift Co., Inc. West Penn Electric Co West Penn Power Co., Pfd Western Dairy Products Co. . . Western Maryland Ry Western Pacific R. R. Corp Western Union Telegraph Co. . . Westinghouse Air Bk. Co. (The) Westinghouse Elec. & Mfg. Co. . 417 WALL STREET WX Pr WZ WCO WXK WL WEO WHI WHR WSW WXC WLX OV WIL WC z WPU WAC WWY YA YC YG YB ZE Westinghouse El. & Mfg. Co., Pfd. Weston Elec. Instrument Corp. .... Westvaco Chlorine Products Co. . . Wextark Radio Stores, Ine Wheeling & Lake Erie Ry White Eagle Oil & Refining Co. . . . White Motor Co White Rock Mineral Springs Co. . . White Sewing Machine Corp Wilcox (H. F.) Oil & Gas Co Wilcox-Rich Corporation Willys Overland Wilson & Co., Inc Wisconsin Central Ry Woolworth & Co. (F. W.) Worthington Pump & Mach. Corp. . Wright Aeronautical Corp Wrigley, Jr. & Co. (Wm.) Y Yale & Towne Mfg. Co. (The) Yellow Truck & Coach Mfg. Co. . . Young (L. A.) Spring & Wire Corp Youngstown Sheet & Tube Co Z Zenith Radio Corp WALL STREET Bonds A AGS Alabama Gt. Southern AK Alaska Gold Mines Co AV Allegheny Valley AO American Cotton Oil Co AIG Amer. I. G. Chemical Corp AGO Anglo-Chilean Cons. Nitr. Corp AEG Argentine Republic AJS Atch., Top. & S. Fe Adj. 4s, Stpd ASL Atchison Trans. Short Line ABM Atlanta Birmingham AKN Atlanta, Knoxville & Cincinnati AFU Atlantic Fruit Co AUT Australia (Commonwealth of) AUS Austrian Government Guaranteed Loan B BWV Balt. & Ohio, Pitts., L. E. & W. Va. BX Balt. & Ohio Southwestern BAV Bavaria (Free State of) BEL Belgium, Kingdom of BLP Bell Telephone Co. of Penna BGN Bergen (City of) BLN Berlin (City of) BSY Big Sandy Ry. (Ches. & Ohio) . . . BLV Bolivia, Republic of BDX Bordeaux, City of (France) BZ Brazil, U. S. of BWY Broadway & Seventh Ave BN Brooklyn, Queens Co. & Suburban BET Brooklyn Rapid Transit BUV Brooklyn Union Elevated BRS Buenos Aires (City of) BSQ Buffalo & Susq. Iron Co 419 CAB CGS CGU CDN CNO CAR CB CDT FX GO CEP CBG CHE CW Q CGL CST CHR CHU RCH CHN CHO CCG CHD CIN CLN CLW CLV CDU COL CLM CMB CML BGU CCM CGC CMS COP cu CMT CZ WALL STREET C Cairo Bridge (Illinois Central) California Gas & Electric Camaguey Sugar Company Canada, Dominion of Canadian Northern Ry Carolina Central Central Branch Union Pacific Central District Telephone Co Central Foundry Central of Georgia Central Pacific Central R. R. & Banking Co. of Ga. . Chicago & Erie Chicago & Western Indiana Chicago, Burlington & Quincy Chicago Gas Light & Coke Co Chicago, Mil. & St. Paul Chicago Railways Chicago Union Station Chile (Republic of) Chinese Govt Choctaw, Oklahoma & Gulf Cincinnati Gas & Elec. Co Cincinnati, Hamilton & Dayton Cincinnati, Ind., St. Louis & Chicago Cincinnati, Lebanon & Northern Cleveland, Lorain & Wheeling Ry. Co, Cleveland Short Line Cleveland Union Terminal Cologne (City of) Colombia, Republic of Columbus & Ninth Ave Commercial Cable Co Compania Azucarera Baragua Consolidation Coal Co. of Maryland . Consumers Gas of Chicago Consumers Power Co Copenhagen (City of) Cuba (Republic of) Cumberland Tel. & Tel Czechoslovak, Republic 420 WALL STREET D DMU Danish Consol. Mun. Loan . . . DEN Denmark, Kingdom of DRG Denver & Rio Grande DES Des Moines & Ft. Dodge DTU Detroit River Tunnel Co DEE Dodge Brothers, Inc DOM Dominican Republic DMX Dominion Iron & Steel Co.. Ltd DNR Donner Steel Company DI Duluth & Iron Range DEI Dutch East Indies E ET East Tenn., Va. & Ga ESU Eastern Cuba Sugar Corp EKY Edison Ilium. Co. of Bklyn. . . . EPG Electric Pw. Corp. of Germany EJO Elgin, Joliet & Eastern EGL Erie, General Lien F FMS Federated Metals Corp FIN Finland (Republic of) FNU Finnish Municipal Loan FLA Florida East Coast Ry FD Fort Worth & Denver City . . FMN Framerican Indust. Dev. Corp FHS French Natl. Mail S. S. Lines FH French Republic G GX Galv., H. & San A., Mex. & Pac. Div GMA General Motors Acceptance Corp. . GP General Petroleum Corp GRL General Steel Castings Corp GLA Georgia & Alabama 421 WALL STREET GCN GER AEG GHO GNT CJP GPW GNR PGU GFI HIT HLM HT HTX HMX HMU HUY ILT ILO ILX IJ ISC INA IG INX IB IT JKM JP Georgia, Carolina & Northern German External Loan German General Electric Good Hope Steel & Iron Grand Trunk Ry Great Con. Elec. Pw. Co., Ltd. (Japan) Great Falls Power Co Great Northern Ry Greater Prague, City of Gulf & Ship Island R. R. Co H Haiti, Republic of Holland-America Line Houston & Texas Central . . Houston, East & West Texas Humble Oil & Refining Co. . Hungarian Cons. Mun. Loan Hungary (Kingdom of) I Illinois Bell Telephone Co 111. Central, Louisville Div 111. Central, St. Louis Div (111. Central) Ghic., St. L. & New Orleans Joint Bonds Illinois Steel Co Indiana, Illinois & Iowa Indiana Natural Gas & Oil Co Indiana Steel Co Interborough Metropolitan Co Internatl.-Gt. Northn. R. R. Co J Jamestown, Franklin & Clearfield Japanese Gov’t 422 WALL STREET KM KU KNY KY KIN KV KFO LK EW CLS LS LRU LPZ LX L LI LMO LNS LY MNR MNV MSS ERR MTT MEX CMC MVX MIL MOB MOH MON MNT MOV MTL MRS K Kanawha & Michigan Kan. City, Ft. Scott & Memph. Ry. Co. 4% of (1936) Kansas City Terminal Kentucky Central Kings County El. Light & Pow Kings County Elevated Kresge Foundation (The) L Lackawanna Steel Co Lake Erie & Western Lake Shore (N. Y. Central) Lake Shore & Mich. Southern Lautaro Nitrate Co., Ltd Leipzig (City of) Lexington Ave. & Pavonia Fer Liberty Loan U. S. Govt Long Island R. R Lou. & Nash., N. Orleans & Mob. Div L. & N. South. Monon. Joint 4s Lyons (City of) (France) M Manila Elec. R. R. & Lighting Corp Marion Steam Shovel Co Marseilles, City of (France) McCormick (Edith Rockefeller) Trust Metropolitan Edison Co Mexico, United States of Michigan Central (N. Y. Cent.) Midvale Steel & Ordnance Co Milwaukee & Northern Mobile & Ohio Mohawk & Malone Montana Central Montana Power Co Montevideo (Uruguay), City of Montreal Tramways Morris & Co 423 WALL STREET N NFS Nash., Florence & Sheffield NU Nassau Electric Ry MXO National R. R. of Mexico NSH National Starch Co NTU National Tube Co NNS Netherlands (Kingdom of the) NTT New England Tel. & Tel. Co NPS New Orleans Public Serv., Inc NSW New South Wales (State of) BMB N. Y., Brooklyn & Manhattan Beach Ry. Co NYC N. Y., (City of) Corporate Stock or Bonds NNR N. Y. Connecting R. R. EF N. Y. Edison Co HP N. Y. Gas, El. Lt., Ht. & Pw. Co NLW N. Y., L. E. & W. Dock & Imp NK N. Y. State Canal Imp NYS N. Y. State Highway SSW N. Y., Susq. & Western NT N. Y. Telephone Co. WCR N. Y., Westchester & Boston NF Niagara Falls Power Co NCK Niagara, Lockport & Ontario Power Co. . . NSO Norfolk & Southern NRD Norfolk & W. New River Div NPO Nor. &. W. Pocohontas Coal Co NOT North American Cement Corp NR Northern Ohio NLO Northern Ohio Trac. & Light NOR Northern R. R. of Cal NPW Northern States Power Co NWY Norway, Kingdom of 0 OD Ogdensburg & Lake Champlain OHW Ohio, Ind. & Western OPV Ohio Public Service Co OPW Ontario Power, Niagara Falls . ONV Oregon R. R. & Navigation ORS Oregon Short Line 424 WALL STREET ORW Oregon-Wash. R. R. & Nav. Co ORV Oriental Development Co., Ltd CRS Oslo, City of (formerly Christiania) P PMO Pacific R. R. of Missouri PWY Paramount Broadway Corp PRY Paris-Lyons-Medit R. R. Co PLX Park-Lexington PAO Penn., Ohio & Detroit R. R PBW Phila., Balto & Washn PRG Phila. & Reading Coal & Iron Co. . . PHI Phil. Islands Land Grant PSH Pittsburgh, Shenango & L. E PUZ Poland (Republic of) PTX Porto Alegre (City of) Q QN Queensland (State of) R RJ Reading Co., Jer. Cen. Coll. 4s RRS Remington Arms Co., Inc RHM Rhein-Main-Danube Corp REL Rhinelbe Union RJN Rio de Janeiro RSU Rio Grande do Sul (State of) RGW Rio Grande Western Ry. Co RGS Rochester Gas & Elec. Corp RK Rock Island Ark. & La ROT Rotterdam (City of) S JG St. Joseph & Grand Island Ry. Co SAK St. Lawrence & Adirondack MRZ St. Louis & Cairo IM St. L., Iron Mt. & Southern 425 WALL STREET IMR St. L., Ir. Mt. & S. Riv. & Gulf D STW St. Louis, Peoria & N. Western SLR St. Louis, Rocky Mt. & Pac SSO St. Louis Southern SDU St. Paul & Duluth KCS St. P. & Kan. City Short Line MM St. Paul, Minn. & Manitoba SLU St. Paul Union Depot Co SAP San Antonio & Arkansas Pass CSX San Paulo (City of) SAG San Paulo (State of) PSF Sante Fe (Prov. of) (Argentine) SVW Savannah Fla & Western SVY Scioto Vy. & New England SBF Seaboard-All Florida Ry SE Seine, Dept, of the SSV Serbs, Croats & Slovenes (Kingdom of the) SUY Sinclair Crude Oil Pur. Co SIP Sinclair Pipe Line SSS Soissons (City of) SNA South & North Alabama SBT Southern Bell Telephone Co SWT Southwestern Bell Tel. Co ORT Sugar Estates of the Oriente SWN Sweden (Kingdom of) SWZ Swiss Confederation SYR Syracuse Lighting Co T TI Tenn. Coal, Iron & R. R. Co TPW Tennessee Electric Power Co TAS Terminal R. R. Assn, of St. L TTX Texas & New Orleans TYO Tokyo (City of) (Japan) TOC Toledo & Ohio Central Ry TOU Toledo, St. L. & Western Ry TWY Tol. Walhonding Valley & O TUY Trumbull Steel Co. (The) U UDL Ulster & Delaware CUV Union Elevated of Chicago 426 WALL STREET UDD UK NJ USL SCP usw UGY UH UPW VN YW VM VY VR WSU WON WS WH WN WNY WRS WEW WHX WIK WE WIN WCS US US PAN PHI United Drug Co. (of Del.) Un. King of Gt. B. & Ireland United N. J. R. R. & Canal United Rys. Co. of St. Louis United Steamship Co., Ltd., of Copenhagen United Steel Works Corp Uruguay (Republic of) Utah & Northern Utah Power & Light Co V Vandalia R. R Virginia & Southwestern Virginia Midland Ry. . . . Virginia Ry. & Power Co Virginian Ry W Warner Sugar Ref. Co Washington Central Ry West Shore R. R Westchester Lighting Co Western Electric Co., Inc Western N. Y. & Penn Western Pacific R. R. Co Westphalia United Electric Pwr. Corp Wheeling Steel Corp Wickwire Spencer Steel Co Wilkesbarre & Eastern Winchester Repeat. Arms Co Wise., Cen. Sup. & Duluth Div United States Government Bonds U. S. Government Securities U. S. Treasury Panama Canal Philippine Islands 427 Security Symbols — New York Curb Exchang SECURITY SYMBOLS AND ABBREVIATIONS STOCKS AND BONDS New York Curb Exchange Notes. Words and Phrases. List of Stocks arranged alphabetically according to names of Stocks. List of Bonds arranged alphabetically according to names of Bonds. Notes One price following the name of a stock on the ticker tape signifies a sale of 100 shares at that price, thus : SN.61. When more than 100 shares are sold, the number of shares sold will precede the price, thus 500 shares sold is recorded as, SN 5.61. Odd lots will be printed thus: 10.SS.61. When the volume and full figures are dropped, the opening transaction in stocks will be printed on the tape in full, for example: SN. 5.61, and subsequent sales will be printed: 1*4, 1% or IV 2 , as the case may be. If the stock recedes to below 60, it will be printed 59%, 0y 2 , 9%, etc. A single price after the name of a bond indicates a sale of $1,000 bonds at that price. An offer alone, without a bid, is preceded by an 0 and a dot, thus: SN. 0.61. A bid alone, without an offer, is followed by the letter B. thus: SN. 61.B. A cash sale will be printed thus : SN.61 cash. When a sale is not reported in its proper place the price will be preceded by the abbreviation SLD, thus: SN.SLD.61. 431 WALL STREET When the amount sold and the price are so nearly alike that they may be taken for two sales, the amount of the sale will be followed by the letter S and a dot, thus: SN.60S.61, meaning Standard Oil Co. of Indiana 6,000 shares at 61. When an error has been made by the reporter, or in printing, the last letter or figure is repeated several times, indicating that the quotation is to be thrown out, thus: SN.61111 or GiVMVM- Buyer’s or Seller’s option contracts will be printed thus : SN.4.61Seller 4 or 4.61 Buyer 4. “At Three days” contracts will be printed thus: SN.61 at 3 days. Delivery time will be printed on the tape at 2 :15 p. m., the recognized time for the settlement of transactions made in the Exchange. Stocks selling less than one dollar will be printed in six- teenths thus : ABC.10.S.1.16 or ABC.10.S.15.16. A “run” of sales will appear as follows: ABC AYg-y^-Ys- y±-%-y 2 or ABC. 10S. 1.16. 20. S. 3. 16. The column headed “Unit” refers to the unit of trading, printing and delivery. If a stock has a unit other than 100 or 1,000 shares, such special unit is shown. If no unit is shown, it signifies that the unit of trading, printing and delivery of the stock is either 100 shares or 1,000 shares, depending on the price at which a transaction is made, i.e., stocks selling at % and over the unit is 100 shares and stocks selling below y^ the unit is 1,000 shares. Transactions in amounts less than the unit are not printed if there is an objection with the exception of transactions closed “under the rule.” 432 WALL STREET Words and Phrases AJ Adjustment. AO April and October. A Assented, Class A. BNK Bank. B Bonds, Class B, or (in figs.) bid or buyer. BR Bond Rights. CT Certificate. C Class C, Coupon, or (in figs.) Cents. CLT Collateral trust. CMP Compromise. CN Consolidated. CV Convertible. CY Currency. CB Currency bonds. D Debenture or division. DE Deferred. DR Debenture Rights. E East or Eastern. EXT Extended, Extension or External. FA February and August. I First. F Flat, without interest. FD Funding. GM General Mortgage. GB Gold bonds. GTD Guaranteed. IMP Improvement. IN Income. INL Internal. IRG Irrigation. JJ January and July. JD June and December. GNT Land Grant. LG Large bonds. LL Leased Lines. MS March and September. MAT Matured. ML Main Line. 433 WALL STREET BIN May and November. BITG Mortgage. N New. NB New Bonds. NS New Series. NF Non-fundable. NR Note Rights. NV Non-Voting. 0 (In figures), Offered. — Old. OB Opening of books. PR Preferred. PRM Premium. RES Rescission. REG Registered. RO Restoration. R Rights. S South, Stock, Series, or (in figures) Seller, or Shares. II Second. SC Scrip. SF Sinking Fund. SB Small bonds. ST Stamped. T Stock Trust Ctfs. TX Tax. TE Tax Exempt. Ill Third. TZY Treasury. TR Trust receipts. UA Unassented. UR Under the Rule. UN Unified. US Unstamped. V Voting Trust Ctfs. W West or Western. WI When Issued. WS Warrants. WW With Warrants. XC Ex-coupon. XD Ex-dividend. XI Ex-interest. XW Without Warrants. 434 WALL STREET ABT ACR A ACM ASM ADR AOL Pr ALW ALW V ALW Pr AUL AUL WS AER A AERB AOU AEF AGN AGNPr AIR ARV V ARV CV Pr ARI V AGS AGS Pr ALP 7 Pr ABR Pr ABR V AID ALH AGL Pr ALF A CV Pr ALFB ALN AFS ALV WW AIC Stocks A Abbott Laboratories (Com.) Acetol Products, Inc. (Conv. “A”) Acme Steel Co Adams (J. D.) Mfg. Co. (Com.) Adriatic Electric Co. (Amer. Dep. Rec.) .... Aeolian Co. (The) (7% Pfd.) Aeolian-Weber Piano & Pianola Co. (Com.) Aeolian-Weber Piano & Pianola Co. (VTC Com.) Aeolian-Weber Piano & Pianola Co. (7% Pfd.) Aeronautical Industries, Inc Aeronautical Industries, Inc. (Wts., Series “A”) Aero Supply Mfg. Co., Inc. (Class “A”) .... Aero Supply Mfg. Co., Inc. (Class “B”) Aero Underwriters Corp Aetna Rubber Co. (The) (Com.) Agfa Ansco Corp. (Com.) Agfa Ansco Corp. (Pfd.) Ainsworth Mfg. Corp (Com.) Air Investors, Inc. (VTC Com.) Air Investors, Inc. (Conv. Pref.) Airstocks, Inc. (VTC) Alabama Great Southern R. R. (Ord.) Alabama Great Southern R. R. (Pref.) Alabama Power Co. ($7 Pfd.) Albert Pick, Barth & Co., Inc. (Part Pfd.) . . . Albert Pick, Barth & Co., Inc. (VTC Com.) Alexander Industries, Inc. (Com.) Allegheny Gas Corp. (Com.) Allegheny Steel Co. (7% Pfd.) Allen Mfg. Co., Inc. (“A” Conv. Pref.) Allen Mfg. Co., Inc. (“B” Stock) Allen Oil Co Alles & Fisher, Inc. (Com.) Allied Aviation Industries, Inc. (with Wts.) Allied International Investing Corp. (Com.) . 435 WALL STREET AIC CV Pr AKR CV Pr AMG AIO AIO Pr ALX ALX I Pr ALX Pr ALE A ADU A ADUB ATO CV Pr ALI AA AA Pr AA WS ALG AMV ALU ADG ADG V AFW II PD AFW WS ASI ACH AEK A AEK Pr ABV ABO ABH BOV F ACP V ACN ACG ACG Pr AIWA Allied International Investing Corp. ($3 Conv. Pfd.) Allied Kid Co. ($6.50 Conv. Pfd.) Allied Mills, Inc Allied Motor Industries, Inc. (Com.) Allied Motor Industries, Inc. ($4 Pfd.) .... Allied Power & Light Corp. (Com.) Allied Power & Light Corp. (1st Pfd., $5 Series) Allied Power & Light Corp. (Pref., $3 Series) Allied Products Corp. (“A” Conv. Com.) .... Allison Drug Stores Corp. (“A” Conv.) Allison Drug Stores Corp. (“B”) Altorfer Bros. Co. (Conv. Pref.) Aluminum, Ltd Aluminum Co. of America (Pa.) (Com.) .... Aluminum Co. of America (Pa.) (6% Pfd.) Aluminum Co. of America (Pa.) (Warrants) Aluminum Goods Manufacturing Co Aluminum Industries, Inc. (Com.) Aluminum Manufacturers, Inc. (Com.) .... Amalgamated Sugar Co. (Com.) Amalgamated Sugar Co. (VTC.) American & Foreign Pw. Co., Inc. (Part Pd. Allot. Ctfs., 50% Pd.) (2nd Pd.) American & Foreign Power Co., Inc. (Option Wts.) American & Scottish Investment Co. (Com.) American Arch Co. (Com.) American Bakeries Corp. (“A” Stock) American Bakeries Corp. (7% Pfd.) American Beverage Corp American Book Co American British & Continental Corp. (Com.) American Brown Boverie Elec. Corp. (Foun- ders Shs.) American Canadian Properties Corp. (VTC) American Chain Co., Inc. (Com.) American Cigar Co. (Com.) American Cigar Co. (Pfd.) American Cities Pw. & Lt. Corp. (Conv. A Opt. Div. Series) 436 WALL STREET AIWB AOY ACXA ACXB ACXO ACO ACY A ACYB ACY Pr ADP I Pr ADP ADI CV Pr AEL AQU AFH AGO AGO Pr AGH AHW AVZB AVZ WS AMY AML AML Pr AIZ AMF AMF Pr AMQ AEM ANS APX ANU ANU 6% Pr ANU 7% Pr AIP Pr American Cities Pw. & Lt. Corp. (“B” Stock) American Colortype Co. (Com.) American Commonwealth Pw. Corp. (“A” Com.) American Commonwealth Pw. Corp. (“B” Com.) American Commonwealth Pw. Corp. (Op- tion Wts.) American Controlled Oilfields, Inc American Cyanamid Co. (“A” Vt. Com.). . . American Cyanamid Co. (“B” Non-Vt. Com.) American Cyanamid Co. (Pfd.) American Department Stores Corp. (1st Pfd. A 7% Conv.) American Dept. Stores Corp. (Com.) American District Telegraph Co. of N. J. (7% Conv. Pfd.) American Electric Power Co. (Com.) American Equities Company (Com.) American Fork & Hoe Co. (The) (Com.) . . . American Gas & Electric Co. (Com.) American Gas & Electric Co. (Pfd.) American Glue Co. (Com.) American Hardware Corp. (The) American Investors, Inc. (Com. “B”) American Investors, Inc. (Opt. Wts.) American Laundry Machinery Co. (Com.) . . American Light & Traction Co. (Com.) American Light & Traction Co. (Pfd.) .... American Maize-Products Co. (Com.) American Manufacturing Co. (Com.) American Manufacturing Co. (Pfd.) American Maracaibo Co American Meter Co American Natural Gas Corp. (Com.) American Phenix Corp. (Gen. Stk.) American Pneumatic Service Co. (Com.) . . . American Pneumatic Service Co. (6% 2nd Pfd.) American Pneumatic Service Co. (7% 1st Pfd.) American Products Co. ($2 Part. Pref.) .... 437 WALL STREET APS Pr APT APT P Pr APT 7% Pr AYZ APU Pr ALA AI ASV ASV P Pr AMT ASE A ASW 1 Pr ASW S Pr ASW AQA TH Pr ATC AVP A VP Pr AWG Pr AMW AMW Pr AMW COD AMW Pr COD AYV AYV CV PR AEM AMC ATR AOR ANT WS American Public Service Co. (7% Pfd.) .... American Public Utilities Co. (Com.) American Public Utilities Co. (Part. Pfd.) . . American Public Utilities Co. (7% Prior Pfd.) American Rayon Products Corp American Republics Corp. (7% Pfd.) American Salamandra Corp. (Gen. Stk.) . . . American Sales Book Co., Ltd. (Com.) .... American Solvents & Chemical Corp. (Dela.) (Com.) American Solvents & Chemical Corp. (Dela.) ($3 Conv. Pref.) American Stove Co American States Public Service Co. (Com. “A”) American Superpower Corp. (Dela.) (1st Pfd.) American Superpower Corp. ($6 Series Pfd.) American Superpower Corp. (Com.) American Thermos Bottle Co. (Class “A” Com.) American Thread Co. (The) (Pfd.) American Transformer Co. (Com.) American Vitrified Products Co. (Com.) . . . American Vitrified Products Co. (Pfd.) .... American Window Glass Co. (7% Pfd.) .... American Window Glass Machine Co. (Com.) American Window Glass Machine Co. (7% Pfd.) American Window Glass Machine Co. (C.O.D. for Com.) American Window Glass Machine Co. (C.O.D. for Pfd.) American Yvette Co., Inc. (Com.) American Yvette Co., Inc. (Conv. Pref.) . . . Amoskeag Mfg. Co. (Receipts) Amrad Corporation (The) (Com.) Amsterdam Trading Co. (Amer. Shs.) Anchor Post Fence Co. (Com.) Andian National Corp., Ltd. (Warrants) . . . 438 WALL STREET ANG V COD ANG N V COD AGO ANH ANH Pr WW AGP AGP 1 Pr AGP 2 Pr AUY Pr A AUY V APM A APE APC APC Pr APG APG Pr ARC ATU ARO AZC AZG AZP AKS AKS Pr AES A AKP Pr AMR A AMR B ACE ALD WS AHH ARW ARU ABL ABL Pr ADY Anglo-American Oil Co., Ltd. (Ctfs. of Dep. in registered form for Vt. Shs.) Anglo-American Oil Co., Ltd. (Ctfs. of Dep. in registered form for Non-Vt. Shares) .... Anglo-Chilean Cons. Nitrate Corp. (Com.) . . Anglo-Norwegian Holdings, Ltd. (Com.) .... Anglo-Norwegian Holdings, Ltd. (7% Pfd. with Wts.) Anglo-Persian Oil Co., Ltd. (Amer. Dep. Rec. Ord.) (Reg.) Anglo-Persian Oil Co., Ltd. (Amer. Dep. Rec. IstPref.) (Reg.) Anglo-Persian Oil Co., Ltd. (Amer. Dep. Rec. 2ndPref.) (Reg.) Angus Company (The) ($4 Pfd. “A”) Angus Co. (The) (New VTC for Com.) Apco Mossberg Corp. (Class “A”) Apex Electrical Mfg. Co. (The) (Com.) .... Appalachian Power Co. (Com.) Appalachian Power Co. (Pfd.) Apponaug Company (The) (Com.) Apponaug Company (The) (6%% Pfd.) . . . Arctic Dairy Products Co. (Com.) Arcturus Radio Tube Co. (Com.) Argo Oil Co Arizona Commercial Mining Co Arizona-Globe Copper Co Arizona Power Co. (Com.) Arkansas Natural Gas Corp. (Com.) Arkansas Natural Gas Corp. (6% Pfd.) .... Arkansas Natural Gas Corp. (“A” Com.) . . . Arkansas Power & Light Co. ($7 Pfd.) .... Armour & Co. (111.) (“A” Com.) Armour & Co. (111.) (“B” Com.) Armstrong Cork Co. (Com.) Arnold Print Work (Warrants) Arrow-Hart & Hegeman Electric Co. (Com.) Art Medal Works, Inc. (Com.) Arundel Corp. (Com.) Asbestos Corp., Ltd. (Com.) Asbestos Corp., Ltd. (7% Pref.) Associated Dyeing & Printing Corp 439 WALL STREET AOE AGA AGA DB R AGA R WI ASX APL ARY ARY Pr AAB Pr ATL AFU AGU ALS ALS Pr AIS A AGW AWO APO APO Pr ASO ACB AUR AUR CV AWR CV Pr AVI AIT AEV ATX A BAW BBE BKW Associated Electrical Industries, Ltd. (Amer. Dep. Rec. Ord.) (Reg.) Associated Gas & Electric Co. (Class “A”) . Associated Gas & Electric Co. (Deb. Rights) Associated Gas & Elec. Co. (Rights) “WI”. . Associated Laundries of America, Inc. (Com.) Associated Portland Cement Mfr’s, Ltd. (Amer. Dep. Rec. Ord.) (Reg.) Associated Rayon Corp. (Com.) Associated Rayon Corp. (6% Cony. Pfd.) . . . Atlanta, Birmingham & Coast R. R. Co. (Pfd.) Atlantic Coast Fisheries Co. (Com.) Atlantic Fruit & Sugar Co. (Com.) Atlantic Gulf Oil Corp. (Com.) Atlantic Lobos Oil Co. (Com.) Atlantic Lobos Oil Co. (Pfd.) Atlas Imperial Diesel Engine Co. (Class “A”) Atlas Light & Power Co., Ltd. (Amer. Dep. Rec. Ord. Reg.) Atlas Plywood Corp Atlas Portland Cement Co. (Com.) Atlas Portland Cement Co. (Pfd.) Atlas Stores Corp. (Com.) Austrian Central Land Credit Bank (Amer. Shs.) Automatic Voting Machine Corp. (Com.) Automatic Voting Machine Corp. (Conv. Pr. Part. Stk.) Automatic Washer Co. (Conv. Pref.) Aviation Corp. of the Americas Aviation Credit Corp Aviation Securities Corp Axton-Fisher Tobacco Co. (The) (“A” Com.) B Babcock & Wilcox Co. (The) Babcock & Wilcox, Ltd. (Amer. Dep. Rec. Ord. Reg.) Backstay Welt Co. (Com.) 440 WALL STREET BHI BHI Pr BKZ V BKZ Pr BX BMO BMO Pr BAT N BCF BCF Pr BOT BOTPr BAS BAX A BES BES 1 Pr BLG Pr BAC V BTC BLT Pr BEN A BEN 1 Pr BJW BNS BNS Pr BCS BCT BIK BIK Pr BHC BHC Pr BGL Pr BIR Pr BIT BDE BLA BEX BLS BDG Bahia Corporation (The) (Com.) Bahia Corporation (The) (7% Pref.) Balaban & Katz Corp. (VTC Com.) Balaban & Katz Corp. (7% Pfd.) Baldwin Co. (The) (Com.) Baltimore Tube Co., Inc. (Com.) Baltimore Tube Co., Inc. (Pfd.) Bancomit Corp. (New Com.) Bancroft (Joseph) & Sons Co. (Com.) Bancroft (Joseph) & Sons Co. (7% Pfd.) . . Barcelona Tract. Lt. & Pw. Co., Ltd. (Ord.) Barcelona Tract. Lt. & Pw. Co., Ltd. (7% Pref.) Bastian-Blessing Co. (The) (Com.) Baxter Laundries, Inc. (“A” Com.) Bearings Co. of America (Com.) Bearings Co. of America (1st Pfd.) Belgo Canadian Paper Co., Ltd. ( 7 % Pfd.) Bellanca Aircraft Corp. (VTC for Com.) . . . Bell Telephone Co. of Canada Bell Telephone Co. of Penna. (The) (6*4% Pfd.) Benesch (Isaac) & Sons, Inc. (“A” Com.) . . Benesch (Isaac) & Sons, Inc. (8% 1st Pfd.) . Benjamin Winter, Inc. (Com.) Benson and Hedges (Com.) Benson and Hedges (Conv. Pref.) Bentley Chain Stores, Inc. (Com.) Berkshire Cotton Mfg. Co Bickfords, Inc. (Com.) Bickfords, Inc. ($2.50 Conv. Pref.) Bigelow-Hartford Carpet Co. (Com.) Bigelow-Hartford Carpet Co. ( 6 % Pfd.) . . . Binghamton Light, Heat & Power Co. ($6 Pfd.) Birmingham Electric Co. ($7 Pfd.) Birtman Electric Co. (Com.) Black & Decker Mfg. Co. (The) (Com.) .... Blauners’s (Com.) Blaw-Knox Co Bliss (E. W.) Corp. (Dela.) (Com.) Blue Ridge Corp. (Com.) 441 WALL STREET BDG CV Pr BSH BSH Pr BHE BHK 1 Pr BPD BAB BRV CV Pr BRS BOA BMR AST BMRBST BMR C ST BMR D ST BMR Pr ST BMX BSW BYM BBH BBH 1 % Pr BBH 2 Pr BRH BL BL Pr BGT BGTR BHY BPM BPM Pr BHR A BHRB BILA BILB BIL Pr BLO BLO A BLUR Blue Ridge Corp. (Opt. 6 % Conv. Pref. Series of 1929) Blyn Shoes, Inc. (Com.) Blyn Shoes, Inc. (Pfd.) Bohack (H. C.) Co., Inc. (Com.) Bohack (H. C.) Co. (7% 1st Pfd.) Boot’s Pure Drug Co., Ltd. (Amer. Dep. Rec. Ord. Reg.) Borg & Beck Co Borin-Vivitone Corp. (Conv. Pref.) Borne-Scrymser Co Boston & Albany Railroad Co Boston & Maine R. R. (“A” Pfd.) Stamped. . Boston & Maine R. R. (“B” Pfd.) Stamped. . Boston & Maine R. R. (“C” Pfd.) Stamped. . Boston & Maine R. R. (“D” Pfd.) Stamped. . Boston & Maine R. R. (Pfd.) Stamped Boston Mexican Pet. Trustee’s Ctfs. (Ord.) . Boston Woven Hose & Rubber Co. (Com.) . . Botany Consolidated Mills, Inc. (Com.) .... Bowman-Biltmore Hotels Corp. (Com.) .... Bowman-Biltmore Hotels Corp. (7% 1st Pfd.) Bowman-Biltmore Hotels Corp. (2nd Pfd.) . . Brach (E. J.) & Sons (Com.) Brazilian Tract. Lt. & Pw. Co., Ltd. (Ord.) . . Brazilian Tract. Lt. & Pw. Co., Ltd. ( 6 % Pfd.) Bridgeport Gas Light Co. (The) Bridgeport Gas Light Co. (Rights) Bridgeport Hydraulic Co Bridgeport Machine Co. (Com.) Bridgeport Machine Co. (Pfd.) Bright Star Electric Co. (The) (Class “A”) . . Bright Star Electric Co. (The) (Class “B”) . . Brill Corp (The) (“A”) Brill Corp. (The) (“B”) Brill Corp. (The) (7% Pfd.) Brillo Mfg. Co., Inc. (Com.) Brillo Mfg. Co., Inc. (“A”) British Aluminum Co., Ltd. (Amer. Dep. Rec. Ord.) (Reg.) 442 WALL STREET BQB BQR BQ PrB BQ PrR BROC BROR BCN BCN 1 Pd BMH BSO BUS BDT 1 Pr WW BKT V BPP BWN Pr BFW A BFW BRU BSM BIN BKP BKS BWL BWL N WI BUW BUW A BUW AD BUW D BUW Pr BVAPr British-American Tob. Co., Ltd. (Amer. Dep. Rec. Ord.) (Bearer) British-American Tob. Co., Ltd. (Amer. Dep. Ree. Ord.) (Reg.) British-American Tob. Co., Ltd. (Amer. Dep. Rec. Pref.) (Bearer) British-American Tob. Co., Ltd., (Amer. Dep. Rec. Pref.) (Reg.) British-American Oil Co., Ltd. (Coupon)... British-American Oil Co., Ltd. Reg.) British Celanese, Ltd. (Amer. Dep. Rec. Ord.) (Reg.) British Celanese, Ltd. (1st Paid Sub. Rec.) . . British Match Corp., Ltd. (Amer. Dep. Rec. Ord. Reg.) British South Africa Co. (Amer. Dep. Rec.) British United Shoe Machinery Co., Ltd. (Amer. Dep. Rec. Ord. Reg.) Broadway Dept. Stores, Inc. ( 7 % 1st Pfd.) (With Wts.) Brockton Gas Light Co. (Stock Tr. Ctfs.) . . . Brompton Pulp & Paper Co., Ltd. (Com.) . . Brown Company (6% Pfd.) Brown Fence & Wire Co. (“A” Conv. Pfd.) . . Brown Fence & Wire Co. (“B” Com.) Bruce (E. L.) Co. (Com.) Bruck Silk Mills, Ltd Buckeye Incubator Co. (Com.) Buckeye Pipe Line Co Buckeye Steel Castings Co. (Com.) Budd Wheel Co. (Com.) Budd Wheel Co. (New Com.) “WI” Buffalo, Niagara & East. Pw. Corp. (Com.) Buffalo, Niagara & East. Pw. Corp. (Class “A”) Buffalo, Niagara & East. Pw. Corp. (Dep. Rec. for “A”) Buffalo, Niagara & East. Pw. Corp. (Dep. Rec. for Com.) Buffalo, Niagara & East. Pw. Corp. (Pfd.) . . Bulova Watch Co., Inc. ($3.50 Conv. Pfd.) . . 44 3 WALL STREET BUK BNT BCO BCO CV Pr BCO WS BUR BUH BUO BUC BUB BWA BCZ BJP CBL V CBW A CBWB CBW Pr CDY CDY Pr CDU CAN Pr CAN CDX CDX Pr CBO CDZ CCF CCF Pr CCW CCW Pr CDL A CMW CAP Bunker Hill & Sullivan Mng. & Concentrat- ing Co Bunte Brothers (Com.) Burco, Inc. (Com.) Burco, Inc. (6% Conv. Pfd., Series 1929) . . Burco, Inc. (Stock Purchase Warrants) .... Burdines, Inc. (Com.) Burma Corp., Ltd. (Amer. Dep. Rec.) Burmah Oil Co., Ltd. (Amer. Dep. Rec. Ord.) (Reg.) Burt (F. N.) Co., Ltd. (Com.) Butler Bros Bwana M’Kubwa Copper Mng. Co., Ltd. (Amer. Shs.) Buzza Clark, Inc. (Com.) Byron Jackson Pump Co. (Com.) C Cable Radio Tube Corp. (YTC Com.) Cables & Wireless, Ltd. (Amer. Dep. Rec. 71 / 2 % “A” Ord.) Cables & Wireless, Ltd. (Amer. Dep. Rec. “B” Ord.) Cables & Wireless, Ltd. (Amer. Dep. Rec. 5y 2 % Pref.) Cady Lumber Co. (Com.) Cady Lumber Co. (7% Conv. Pfd.) Camden Fire Insurance Association Canada Bread Co., Ltd. (7% Pfd.) Canada Bread Co., Ltd. (Com.) Canada Steamship Lines, Ltd. (Com.) Canada Steamship Lines, Ltd. (6% Pfd.) . . Canadian Brewing Corp., Ltd. (Com.) Canadian Bronze Co., Ltd. (Com.) Canadian Car & Foundry Co., Ltd. (Com.) . . Canadian Car & Foundry Co., Ltd. (Pfd.) . . Canadian Cottons, Ltd. (Com.) Canadian Cottons, Ltd. (6% Pfd.) Canadian Industrial Alcohol, Ltd. “A” Canadian Marconi Co Capital Traction Co 444 WALL STREET CSG CQ CCI A CCIB CMK N WI CMK CET CPO Pr CAE A CAE B CAER CAS CRM CCO CLZ 1 Pr CLZ CLZ N Pr CEL CEL Pr CEL 1 Pr CTL V CSO CSO PL CSO Pr CFR V CEH V CLP Pr CIP Pr CEW Pr CPV CEQ A CSE CSE Pr CSE 6 Pr WW Caracas Sugar Co Carib Syndicate, Ltd. (Com.) Carman & Co., Inc. (Conv. “A”) Carman & Co., Inc. (“B” Stock) Carnation Co. (New Com.) “WI” Carnation Milk Products Co. (Com.) Carnegie Metals Co. (Com.) Carolina Power & Light Co. ($7 Pfd.) Carreras, Ltd. (Amer. Dep. Rec. “A” Ord.) . . Carreras, Ltd. (Amer. Dep. Rec. “B” Ord.) . . Carreras, Ltd. (Amer. Dep. Rec. Ord.) (Reg.) Castle (A. M.) & Co Caterpillar Tractor Co Ce-Co Manufacturing Co., Inc. (Com.) Celanese Corp. of Amer. (7% 1st Part. Pfd.) Celanese Corp. of America (Com.) Celanese Corp. of Amer. (New 7% Series Prior Pfd.) Celluloid Corp. (Com.) Celluloid Corp. ($7 Div. Pfd.) Celluloid Corp. (1st Pfd. Part.) Central Atlantic States Service Corp. (VTC) (Com.) Central & South West Utilities Co. (Com.) . Central & South West Utilities Co. ($7 Pr. Lien) Central & South West Utilities Co. ($7 Pfd.) Central Fire Insurance Co. of Balti. (VTC) Central Hudson Gas & Elec. Corp. (VTC Com.) Central Illinois Public Service Co. ($6 Pfd.) Central Indiana Power Co. (7% Pfd.) Central Power & Light Co. (Mass.) (7% Pfd.) Central Public Service Co. (Dela.) (Com.) .. Central Public Service Corp. (Md.) (Class “A”) Central States Elec. Corp. (Com.) Central States Elec. Corp. (7% Pfd.) Central States Elec. Corp. (Pfd., 6 % Series, with Wts.) 445 WALL STREET CSE 6 Pr XW Central States Elec. Corp. (Pfd., 6 % Series, without Wts.) CSE CV Pr Central States Elec. Corp. (Cony. Pfd., Op- tional Div. Series) CSE WS CSE CV Pr N Central States Elec. Corp. (Warrants) Central States Elec. Corp. (Conv. Pfd., Opt. Div. Series of 1929) CPI CER CBC CHV CSP Pr CSK CHP CONWI CBM NWRWI Centrifugal Pipe Corp Century Electric Co Chain Belt Company Chain Store Development Corp. (Com.) .... Chain Store Products Corp. (Part. Pfd.) .... Chain Stores Stocks, Inc Charis Corporation (Com.) Chesapeake & Ohio R. R. Co. (New) “WI”. . Chesebrough Mfg. Co. (Cons.) (Com.) Chicago & Northwestern Rwy. Co. (Rights) “WI” CDW CCN A CGO Chicago Daily News, Inc. (The) (Com.) . . . Chicago Nipple Mfg. Co. (Class “A”) Chicago, North Shore & Mil. R. R. Co. (Com.) CGO PL Chicago, North Short & Mil. R. R. Co. (7% Pr. Lien) CGO Pr Chicago, North Shore & Mil. R. R. Co. (6% Pfd.) CRL CEL Pr CFC CDI Pr CNN CBK PR Chicago Railway Equipment Co. (Com.) . . . Chicago Railway Equipment Co. ( 7 % Pfd.) Chief Consolidated Mining Co Childs Co. (Pfd.) Cin. & Suburban Bell Tel. Co Cincinnati Ball Crank Co. ($2.25 Conv. Part. CCE CSB CSV CSV CSV Pr CSV B CSV BB CSV CSV R WI Pfd.) Cincinnati Street Railway Cities Service Co. (Bankers) Cities Service Co. (Com. Cash Scrip) Cities Service Co. (Com. Stock Scrip) Cities Service Co. (Pfd.) Cities Service Co. (Pf. B) Cities Service Co. (Pf. BB) Cities Service Co. (Com.) Cities Service Co. (Rights) “WI” 446 WALL STREET CSW 6 Pr CSW 7 Pr CY CRR CSL GEL A CKY CLC CLC Pr CLF V CVX CVT CFL CFL Pr CHXA CLB COA CEP CMX CRG CMS CXY CXYPr COH CPL CPL Pr COO CPF CPS CUS CAU CV CUW CRC CPT CWE CMP Pr CXWO CWOB Cities Service Pw. & Light Co. ($6 Pfd.) . . Cities Service Pw. & Light Co. ($7 Pfd.) . . City Machine & Tool Co. (The) City Radio Stores, Inc. (Com.) City Savings Bank Co., Ltd., Budapest (Amer. Shs.) Clark Lighter Co., Inc. (Conv. “A”) Clark (The D. L.) Company Cleveland Cliffs Iron Co Cleveland-Cliffs Iron Co. (New $5 Pfd.) .... Cliffs Corp. (The) (VTC Com.) Cleveland Electric Illuminating Co. (Com.). Cleveland Tractor Co. (The) (Com.) Clinchfield Coal Corp. (Com.) Clinchfield Coal Corp. (Pfd.) Clorax Chemical Co. (Class “A” Stock) .... Club Aluminum Utensil Co. (Com.) Coats (J. & P.) Ltd. (Amer. Dep. Ree. Ord.) (Reg.) Cockshutt Plow Co., Ltd. (Com.) Cohn-Hall-Marx Co. (Com.) Cohn & Rosenberger, Inc. (Com.) Colombia Syndicate Colorado Power Co. (The) (Com.) Colorado Power Co. (The) (Pfd.) Coleman Lamp & Stove Co. (Com.) Colgate-Palmolive-Peet Co. (Com.) Colgate-Palmolive-Peet Co. ( 6 % Pfd.) Colon Oil Corporation (Com.) Colt’s Patent Fire Arms Mfg. Co Columbia Pictures Corp. (Com.) Columbia Steel Corp. (Com.) Columbus Auto Parts Co. (Conv. Pref.) .... Columbus Elec. & Pw. Co. (Com.) Columbus Rwy. Pw. & Lt. Co. (Com.) Commerz-und Privat Bank (Amer. Dep. Rec.) Commonwealth Edison Co Commonwealth Power Corp. (Pfd.) Commonwealth & Southern Corp. (Option Wts.) Commonwealth Utilities Corp. (Com. “B”) . 447 ’WALL STREET CWO B COD Cl CTUP CTW CDO CTC CON CEV CEV Pr CIY Pr CIY CAF CAO V CAO Pr CGR WS CCP CZ CSY CGB CGB Pr A CGB V CGB Pr A V CGT A CDG CIC CIC Pr CDV CEU CDJ Commonwealth Util. Corp. (Ctfs. of Dep. for “B” Com.) Community Pw. & Lt. Co. (Com.) Community Telephone Co. (Cum. Part. Stock) Community Water Service Co. (Com.) Compania Hispano-Americana Electricidad “Chade” (Amer. Shares for “E” Shares) . . Comstock Tunnel & Drainage Co Coniagas Mines, Ltd Connecticut Electric Service Co. (Com.) . . . Connecticut Electric Service Co. (Conv. Pfd.) Connecticut Power Co. ( 6 % Pfd.) Connecticut Power Co. (Com.) Consolidated Aircraft Corp. (Com.) Consolidated Automatic Merchandising Corp. (VTC Com.) Consolidated Automatic Merchandising Corp. ($3.50 Pfd.) Consolidated Cigar Corp. (Warrants) Consolidated Copper Mines Corp Cons. Cortez Silver Mines Co. of Nev Consolidated Dairy Prod. Co., Inc. (Com.) . Cons. Gas Elec. Lt. & Pw. Co. of Balto. (Com.) Cons. Gas Elec. Lt. & Pw. Co. of Balto. ( 5 % Pfd., Series “A”) Cons. Gas Elec. Lt. & Pw. Co. of Balto. (YTC Com.) Cons. Gas Elec. Lt. & Pw. Co. of Balto. (YTC 5 % Pfd. “A”) Consolidated Gas Utilities Co. (“A” Stock) . . Cons. Gold Fields of So. Africa, Ltd. (Amer. Dep. Rec. Ord.) (Bearer) Consolidated Ice Co. of Pittsburgh (Com.) . . Consolidated lee Co. of Pittsburgh (6% Pfd.) Cons. Instrument Co. of Amer., Inc. (Com.) . Consolidated Laundries Corp. (Com.) Consolidated Lead & Zinc Co. (Com.) 448 WALL STREET CMF CLT CNV CNL CNL Pr WW CNL Pr XW CNL WS COY CSC CSC Pr CTH V CTR COM CCM Pr CNS CDH CTG P Pr CT V CLX CIR CIR V CIR Pr CPY CPY Pr WW CBE CBE Pr WW CPR A XW CPX CD COS CRU Pr A CRU CTF Consolidated Main Reef Mines & Estates, Ltd Consolidated Mining & Smelting Co. of Can- ada, Ltd Consolidated Nevada-Utah Corp Consolidated Retail Stores, Inc. (Com.) .... Consolidated Retail Stores, Inc. (8 °/o Pfd., with Wts.) Consolidated Retail Stores, Inc. (8% Pfd., without Wts.) Consolidated Retail Stores, Inc. (Warrants) Consolidated Royalty Oil Co Consolidated Steel Corp. (Com.) Consolidated Steel Corp. (Pfd.) Cons. Theatres, Ltd. (VTC Com.) Consolidated Traction Co. of N. J Consolidation Coal Co. (Com.) Consolidation Coal Co. (7% Pfd.) Consumers Co. (Com.) Continental-Diamond Fibre Co Continental Gas & Elec. Corp. (7% Prior Pref.) Continental Oil Co., Maine (VTC) Continental Securities Corp. (Com.) Continental Steel Corp. (Com.) Continental Steel Corp. (VTC for Com.) . . . Continental Steel Corp. (7% Pfd.) Coon (W. B.) Company ( Com.) Coon (W. B.) Company (7% Pfd., with Wts.) Cooper-Bessemer Corp. (The) (Com.) Cooper-Bessemer Corp. (The) ($3 Pfd. “A” with Wts.) Copeland Products, Inc. (“A” without Wts.) Copper Range Co Cord Corporation Corno Mills Co. (The) Corroon & Reynolds Corp. ($6 Div. Conv. “A” Pfd Corroon & Reynolds Corp. (Com.) Coty Societe Anonyme (Amer. Dep. Rec. Bearer Shs.) 449 WALL STREET COX COX Pr COU COU Pr CRA CM CM Pr CWH V CPG CRP CSS CRO CDK Pr WW COL COM CNP CCK Pr COR COR Pr CYS CTO V CTO V Pr CUM CUN CUN Pr WW CUL CUG CAX CUP V CAC CUY CRB Pr CWZ WS CSI Cosden Oil Company (Com.) Cosden Oil Company (Pfd.) Courtaulds, Ltd. (Amer. Dep. Rec. Ord.) (Reg.) Courtaulds, Ltd. (Amer. Dep. Rec. 5% Pref.) (Reg.) Cramp (Wm.) & Sons Ship & Engine Bldg. Corp Crane Co. (Com.) Crane Co. (Pfd.) Cream of Wheat Corp. (VTC) Creamery Package Mfg. Co. (Com.) Creole Petroleum Corp Cresson Cons. Gold Mng. & Mlg. Co Crocker-Wheeler Elec. Mfg. Co. (Com.) . . . Crosse & Blackwell, Inc. ($3.50 Pref., with Wts.) Crowell Publishing Co. (Com.) (Vt.) Crowley, Milner & Co. (Com.) Crown Central Petroleum Corp. (Com.) .... Crown Cork & Seal Co., Inc. ($2.70 Pfd.) . . . Crystal Oil Refining Corp. (Com.) Crystal Oil Refining Corp. (6% Pfd.) Crystal Tissue Co. (The) (Com.) Cuban Tobacco Co., Inc. (VTC Com.) Cuban Tobacco Co., Inc. (VTC Pfd.) Cumberland Pipe Line Co., Inc Cuneo Press, Inc. (The) (Com.) Cuneo Press, Inc. (The) (6y 2 % Pfd., with Wts.) Curtis Lighting, Inc. (Com.) Curtis Manufacturing Co Curtiss Aeroplane Export Corp. (Com.) . . . Curtiss Airports Corp (VTC) Curtiss Assets Corp. (Ctfs. Bene. Interest) . . Curtiss Flying Service, Inc. (Com.) Curtiss-Reid Aircraft Co., Ltd. (Pfd., with Wts.) Curtiss-Wright Corp. (Warrants) Cusi Mexicana Mining Co 450 WALL STREET DDL A DDL B DRV DYP DVA DVY DPR A DPR B DV DSU CT DSU DSU Pr DIU A DEY DEC DKM DER DFO DHV 0 DHVN DLW DNL DY DY Pr DNV DYO DYO Pr DAC DRT DRR DTV DMO DSP DEU DRSB DEV D Dairy Dale Co. (Class “A”) Dairy Dale Co. (Class “B”) Daniel Reeves, Inc. (Com.) Darby Petroleum Corp Davega, Inc Davenport Hosiery Mills, Inc. (Com.) David Pender Grocery Co. (Class “A” Conv.) David Pender Grocery Co. (Class “B”) .... Davis Coal & Coke Co. (The) Davis Drug Stores Corp. (Allot. Ctfs.) Davis Drug Stores Corp. (Com.) Davis Drug Stores Corp. (Conv. Pref.) Davis Industries, Inc. (Class “A” Stock) . . . Dayton Airplane Engine Co. (Com.) Decca Record Co., Inc. (Amer. Shs.) Decker (Alfred) & Cohn, Inc. (Com.) Deere & Company (Com.) DeForest Radio Co. (Com.) DeHavilland Aircraft Co., Ltd. (Amer. Dep. Rec. Ord. Reg. Carrying Full Divids.) .... DeHavilland Aircraft Co., Ltd. (Amer. Dep. Rec. Ord. Reg. Carrying Divs. from 2/1/29) Delaware Railroad Co. (The) Dennis Bros., Ltd., (Amer. Dep. Rec. Ord. Reg.) Denver Tramway Corp. (Com.) Denver Tramway Corp. (7% Pfd.) Denver Union Stock Yards Co. (Com.) .... Derby Oil & Refining Corp. (Com.) Derby Oil & Refining Corp. (Pfd.) Detroit Aircraft Corp Detroit & Cleveland Navigation Co Detroit Creamery Co Detroit-Michigan Stove Co Detroit Motorbus Co Detroit Steel Products Co Deutsche Bank (Berlin) (Amer. Dep. Rec.) . . Devoe & Raynolds Co., Inc. (“B” Com.) .... Devonian Oil Co 451 WALL STREET DEX DC DC Pr DPO DHT A WW DCO Dexter Co. (The) (Com.) Dictaphone Corp. (Com.) Dictaphone Corp. (Pfd.) Dictograph Products Co., Inc Dinkier Hotels Co., Inc. (“A” with Wts.) . . . Direction der Disconts Gesellschaft (Amer. Dep. Rec.) DIL Distillers Co., Ltd. (Amer. Dep. Rec. Ord.) (Reg.) DGU DIX DDM Pr DDC DLS DBR DBR R WI DGS DTX DTX Pr DHN A DNT 6 Pr DNT DMC DOU DUG Pr DOW DOW Pr DOW R WI DA DSR DMY A DRH DRH N WI DOR DUF DUK DZ DLPR Dixie Gas & Utilities Co. (Com.) Dixon (Joseph) Crucible Co Dodge Manufacturing Corp. (8 % Pfd.) .... Doehler Die-Casting Co. (Com.) Dolores Esperanza Corp Dominion Bridge Co., Ltd Dominion Bridge Co., Ltd. (Rights) “WI”. . Dominion Glass Co., Ltd. (Com.) Dominion Textile Co., Ltd. (Com.) Dominion Textile Co., Ltd. (7% Pfd.) Donahue’s, Inc. (“A” Part Pref.) Donner Steel Co., Inc. ($6 Conv. Pfd.) Donner Steel Co., Inc. (New Stock) Dort Motor Car Co. (Com.) Douglas Aircraft Co., Inc Douglas (W. L.) Shoe Co. (7% Pfd.) Dow Chemical Co. (Com.) Dow Chemical Co. (Pfd.) Dow Chemical Co. (The) (Rights) “WI”. . . . Draper Corp Dresdner Bank (Berlin) (Amer. Shs.) Dresser (S. R.) Mfg. Co. (“A” Part. Conv.) . . Driver-Harris Co. (Com.) Driver-Harris Co. (New Com.) “WI” Dubilier Condenser Corp. (Com.) Duff-Norton Mfg. Co. (The) (Com.) Duke Power Company (Com.) Dundee Arizona Copper Co Dunlop Rubber Co., Ltd. (Amer. Dep. Rec. for Ord.) (Reg.) DQO DTM DM Duquesne Oil Corp Durant Motors of Canada, Ltd Durant Motors, Inc. (Dela.) 452 WALL STREET DXZ P Pr WW Durham Duplex Razor Co. ($4 Prior Pref. with Wts.) DVL Duval Texas Sulphur Co DVL N WI Duval Texas Sulphur Co. (New) “WI” .... DUZ A Duz Co., Inc. (Class “A”) DUZ A V Duz Co., Inc. (VTC repre. “A”) EAG WW ELK EGP EAR EBM EFU EFU 6 Pr EFU P Pr EMC ESTB ESL ES ESIPr ES 2 Pr EUV A ECY ELR EY EOS ELU EGE EDP Pr WW EGY EIS ELD EBS EBS Pr EHU ELY E Eagle (C. K.) & Co., Inc. ( 7 % Pfd. with Wts.) Eagle Lock Co Eagle Picher Lead Co. (The) (Com.) Earl Radio Corporation East Butte Copper Mining Co Eastern Gas & Fuel Association (Com.) .... Eastern Gas & Fuel Association (Pfd. 6 % Series) Eastern Gas & Fuel Association (Prior Pfd.) Eastern Manufacturing Co Eastern States Power Co. (“B” Com.) Eastern Steamship Lines, Inc. (Com.) Eastern Steel Co. (The) (Com.) Eastern Steel Co. (The) 1st Pfd.) Eastern Steel Co. (The) (2nd Pfd.) Eastern Utilities Investing Corp. (“A” Com.) Economy Grocery Stores Corp El Dorado Oil Works (Com.) Eddy Paper Corp. (Com.) Edison Brothers Stores, Inc. (Com.) Edison Electric Ilium. Co. of Boston Edison General Italian Elec. Co. (Amer. Dep. Rec.) Educational Pictures, Inc. (8% Pfd. with Wts.) Egyptian Portland Cement Co. (Com.) Eisler Electric Corp. (Com.) Elder Manufacturing Co. (Com.) Electric Bond & Share Co. (Com.) Electric Bond & Share Co. ($6 Pfd.) Electric Household Utilities Corp Electric Investors, Inc. (Com.) 453 WALL STREET ELV Pr EL 2 Pr A ELO EPW EPW A EPS ESO ESO Pr WW ETV Pr ENW ELM Pr ELO A Pr ELY EMF 7 Pr EMF 8 Pr EMW EPS EMS EMR EDR El EPU WS ESX EKU EVW EVW Pr EWA EXL Electric Investors, Inc. ($6 Pfd.) Electric Power & Light Corp. (“A” 2nd Pfd.) Electric Power & Light Corp. (Option Wts.) Electric Power Associates, Inc. (Com.) Electric Power Associates, Inc. (Full Paid Class A) Electric Railway Securities Co Electric Shareholdings Corp. (Com.) Electric Shareholdings Corp. ($6 Conv. Pfd. Opt. Div. Series, with Wts.) Electric Shovel Coal Corp. ($4 Part. Pfd.) . . Elgin National Watch Co Elmer Richards Co. (Conv. Pfd.) El Paso Electric Co. (Dela.) (“A” 7% Pfd.) Ely & Walker Dry Goods Co. (Com.) Empire Gas & Fuel Co. (Dela.) ( 7 % Pfd.) . . Empire Gas & Fuel Co. (Dela.) ( 8 % Pfd.) . . Empire Power Corp. (Part. Stock) Empire Public Service Corp. (“A” Com.) . . . Empire Steel Corp. (Com.) Employers Reinsurance Corp Emsco Derrick & Equipment Co Engineer Gold Mines, Ltd., Inc Engineers Public Service Co., Inc. (War- rants) Essex Foundry (Com.) Eureka Pipe Line Co. (The) Evans Wallower Lead Co. (Com.) Evans Wallower Lead Co. (7% Pfd.) Ewa Plantation Co Ex-cello Aircraft & Tool Corp. (Com.) FAB FMS FMS Pr FAV FIY FMY FAJ FAL F Fabrics Finishing Corp. (Com.) Fageol Motors Co. (Cal.) (Com.) Fageol Motors Co. (Cal.) ( 7 % Pfd.) Fairchild Aviation Corp. (Com.) Fairey Aviation Co., Ltd. (Amer. Shs.) Fairmont Creamery Co. (The) (Com.) Fajardo Sugar Co. of Porto Rico (The) . . . Falcon Lead Mining Co 454 WALL STREET FRV FLR FDO FFY FNL FAR FMU A FKT FEG FRW FBP 1 Pr XW FED FEL A FOE A FIT DB R FIT FIM FNI FIP FFU FIR FNS FGE V FTZ FES FPW 7 Pr FOK FOL FDM FOT FBT FRD FMC A FMCB FOF Fall River Elec. Light Co Fall River G.as Works Co Fandango Corp. (Com.) Fanny Farmer Candy Shops, Inc. (Com.) . . . Fansteel Products Co., Inc Farr Alpaca Co Fedders Manufacturing Co., Inc. (Class “A”) Federal Knitting Mills Co. (Com.) Federal Mogul Corporation Federal Screw Works Federated Business Publications, Inc. (1st Pfd., without Wts.) Federated Metals Corp Feltman & Curme Shoe Stores Co. (The) (Class “A” Com.) Ferro Enameling Co. (The) (“A” Part.)... Fiat (Deb. Bond Rights) Fiat (Amer. Dep. Rec.) Film Inspection Machine Co., Inc Financial Investing Co. of N. Y., Ltd Fire Association of Philadelphia Fireman’s Fund Insurance Co Firestone Tire & Rubber Co. (Com.) First National Copper Co Fitchburg Gas & Elec. Light Co. (Stock Tr. Ctfs.) Fitz Simons & Connell Dredge & Dock Co.. . Florence Stove Co Florida Power & Light Co. ($7 Pfd.) Fokker Aircraft Corp. of America (Com.) . . Foltis-Fisher, Inc. (Com.) Food Machinery Corp. (Com.) Foote Bros. Gear & Machine Co. (Com.) . . . Foote-Burt Co. (The) (Com.) Ford Motor Co., Ltd. (Amer. Dep. Rec. Ord.) (Reg.) Ford Motor Co. of Canada, Ltd. (New Class “A” Non-Vt.) Ford Motor Co. of Canada, Ltd. (New Vt. “B”) Ford Motor Co. of France (Amer. Dep. Rec. Bearer Shs.) 455 WALL STREET FDY FDYPr FEB FORA FIL FWPPr FOS FOS Pr FOU Pr FOZ A FTH WW FXT A FKN FKN Pr FRY FRS FER FHL FLU A FLU AA FWY GAL COD GAL 0 Pr COD GAL N Pr COD GAL GAL 0 Pr GAL N Pr GLU GHU GHU Pr GNV GNV Pr GAR GLK GFGB GMR A GMRB Foremost Dairy Products, Inc. (Com.) .... Foremost Dairy Products, Inc. (Conv. Pfd.) . Foremost Fabrics Corp. (Com.) Forham Co. (Class “A”) Formica Insulation Co Fort Worth Power & Light Co. (7% Pfd.) . . Foster & Kleiser Co. (Com.) Foster & Kleiser Co. (7% Pfd.) Foundation Co. (Pfd.) Foundation Co. (Foreign) Class “A”) Fourth National Investors Corp. (Com. with Wts.) Fox Theatres Corp. (Class “A” Com.) Franklin (H. H.) Mfg. Co. (Com.) Franklin (H. H.) Mfg. Co. (7% Pfd.) Franklin Railway Supply Co., Inc Fraser Companies, Ltd. (Com.) Freed-Eisemann Radio Corp French Line (Amer. Shares) Fuller Brush Co. (The) (Class “A”) Fuller Brush Co. (The) (Class “AA”) Furness, Withy & Co., Ltd. (Amer. Dep. Rec. Ord. Reg.) G Galena Signal Oil Co. (COD for Com.) Galena Signal Oil Co. (COD for Old Pfd.) Galena Signal Oil Co. (COD for New Pfd.). Galena Signal Oil Co. (Com.) Galena Signal Oil Co. (Old Pfd.) Galena Signal Oil Co. (New Pfd.) Galesburg Coulter-Disc Co Galveston-Houston Electric Co. (Com.) Galveston-Houston Electric Co. (6% Pfd.) . Gardner-Denver Co. (Com.) Gardner-Denver Co. (7% Pfd.) Garland Steamship Corp. (Com.) Garlock Packing Co. (The) (Com.) Gears & Forgings, Inc. (“B” Stock) Gemmer Manufacturing Co. (“A”) Gemmer Manufacturing Co. (“B”) 456 WALL STREET GNY GIV Pr WW GIV GGS N A WI GGS N B WI GKN GKN Pr GGN WS AEG AEG WS GLER GEP GLP GID V GLL GNS GP Pr GPI GPV 6 Pr GRY GRY Pr WW GIK GIK A GIK P Pr GIK 1 Pr GTH V GTR GWW A GEM GOW Pr GWY General Alloys Co. (Com.) General American Investors Co., Inc. (6% Pfd., with Warrants) General American Investors Co., Inc. (Com.) General Gas & Electric Corp. (New Com. “A”) “WI” General Gas & Electric Corp. (New Com. “B”) “WI” General Baking Corp. (Com.) General Baking Corp. (Pfd.) General Cable Corp. (Warrants) General Electric Co. (Germany) (Amer. Dep. Reg. Com.) General Electric Co. (Germany) (Stock Pur. Wts.) General Electric Co., Ltd., (Amer. Dep. Rec. Ord.) (Reg.) General Empire Corp General Fireproofing Co. (Com.) General Industrial Alcohol Corp. (VTC Com.) General Laundry Mach. Corp. (Com.) General Necessities Corp. (Com.) General Petroleum Corp. (Pfd.) General Printing Ink Corp. (Com.) General Public Service Corp. ($6 Pfd.) .... General Realty & Util. Corp. (Com.) General Realty & Util. Corp. (Pfd. $6 Series, with Wts.) General Silk Corp. (Com.) General Silk Corp. (Class “A”) General Silk Corp. (6% Part. Pfd.) General Silk Corp. (7% 1st Pfd.) General Theatres Equipment, Inc. (VTC Com.) General Tire & Rubber Co. (Com.) General Water Works & Elec. Corp. (“A” Com.) Geometric Stamping Co. (Com.) Georgia Power Co. (New Cons. Corp. ($6 Pfd.) Georgia Railroad & Banking Co 457 WALL STREET GRW GRW 1 Pr GRW 2 Pr GKW GKW Pr GED GIT GIT Pr GRT GBT GBT Pr WW GST GLY GLB GLH GLH N WI GA GAS A GUW GWC GWC Pr GOXB GOX Pr WW GHI GHI Pr WW GCM GOY GBI GMS GMK GV GSC GOH A GOH Pr WW GMO V GOT GEZ GAM Georgia Railway & Power Co. (Com.) Georgia Railway & Power Co. (8% 1st Pfd.) Georgia Railroad & Power Co. (4% 2nd Pfd.) Gerlach-Barklow Co. (The) (Com.) Gerlaeh-Barklow Co. (The) (Conv. Pref.) . . Gerrard (The S. A.) Co. (Com.) Giant Portland Cement Co. (Com.) Giant Portland Cement Co. (7% Pfd.) Gibson Art Co. (Com.) Gilbert (The A. C.) Co. (Com.) Gilbert (The A. C.) Co. (Pref., with Wts.) . . Gilchrist Co (Com.) Gillican Chipley Co Gladding, McBean & Co. Gleaner Combine Harvester Corp Gleaner Combine Harvester Corp. (New) “WI” Glen Alden Coal Co Globe Automatic Sprinkler Co. of U. S. “A” Globe Underwriters Exchange, Inc Globe-Wernieke Co. (The) (Com.) Globe-Wernicke Co. (The) (6% Pfd.) Godchaux Sugars, Inc. (Class “B”) Godchaux Sugars, Inc. ($7 Pfd., with Wts.) . Goldberg (S. M.) Stores, Inc. (Com.) Goldberg (S. M.) Stores, Inc. ($7 Pfd. with Wts.) Gold Coin Mining Co Gold Seal Electrical Co., Inc. (Com.) Goldblatt Bros., Inc. (Com.) Golden Center Mines, Inc Golden State Milk Products Co. .......... Goldfield Cons. Mines Co. Goldman Sachs Trading Corp. Gorham, Inc. (Com. “A”) Gorham, Inc. ($3 Pfd., with Wts) Gorham Manufacturing Co. (VTC Com.) . . . Gotfredson Corp., Ltd Gotham Knitbac Machine Corp Gramophone Co., Ltd. (Amer, Dep. Rec. Ord.) (Reg.) 458 WALL STREET GAM SR GRV GMU GAP 1 Pr Gramophone Co., Ltd. (Full Pd. Sub. Rec.) . . Grand Rapids Varnish Corp Graymur Corp Great Atlantic & Pacific Tea Co. of Amer. GAP N V (Md.) (7% 1st Pfd.) Great Atlantic & Pacific Tea Co. of Amer. GDD GLS P PD (Com. Non-Vt.) Great Lakes Dredge & Dock Co Great Lakes Steel Corp. (Ctfs. of Sub.) ($20 Paid) GLS COD Great Lakes Steel Corp. (Ctfs. of Dep. for Ctfs. of Sub.) GKT GWP 7 Pr GWP 6 Pr Great Lakes Transit Corp. (Com.) Great Western Pw. Co. of Cal. (7% Pfd.) . . . Great Western Pw. Co. of Cal. ( 6 % Pfd., “A”) GTD GTD Pr GRF A GEP GEF Pr GDW A GPRV GHP GHP Pr GWT GFU GUD GOP GUY Greenfield Tap & Die Corp. (Com.) Greenfield Tap & Die Corp. (8% Pfd.) Greif Bros. Cooperage Corp. (“A” Com.) . . . Greif (L.) & Bro., Inc. (Com.) Greif (L.) & Bro., Inc. ( 7 % Pfd.) Griffith (D. W.) Inc. (Class “A”) Grocery Store Products, Inc. (VTC Com.) . . Ground Gripper Shoe Co., Inc. (Com.) Ground Gripper Shoe Co., Inc. ($3 Pfd.) . . . Gruen Watch Co. (The) (Com.) Guardian Fire Assurance Corp. of N. Y. ... Guardian Investors Corp. (Com.) Gulf Oil Corp. of Pa Guy Motors, Ltd. (Amer. Dep. Rec. Ord. Reg.) HE HAK HAK Pr HAL HLP HLT HBL CT H Habirshaw Cable & Wire Corp. (Com.) Hale & Kilbourn Corp. (Com.) Hale & Kilbourn Corp. (Pfd.) Hale Bros. Stores, Inc Hall (C. M.) Lamp Co Hall (W. F.) Printing Co Hambleton Corp. (The) (Allot. Ctfs.) 459 WALL STREET HAM HAB HMW HPK HDY PPr HKM HKMPr HKM B HC HPR BE HEY HEY Pr WW HIO HED HCE CV Pr HEE HEE A HEM HCG HEL HEL V HTI P Pr HTO HLUlPr HLUPr HAV HCL HAW HWF HAY HZT HZ HL HGM HEE HTY A HKE Pr Hamburg-American Line (Amei\ Dep. Rec. Com. Bearer) Hamilton Brown Shoe Co Hamilton Watch Co. (Com.) Hammermill Paper Co. (Com.) Handley Page, Ltd. (Amer. Dep. Rec. Part. Pref . ) Hanes (P. H.) Knitting Co. (Com.) Hanes (P. H.) Knitting Co. (Pfd.) Hanes (P. H.) Knitting Co. (Com. “B”) . . . Happiness Candy Stores, Inc. (Com.) Ilarpen Mining Corp. (Bond Rights) Ilarris-Seybold-Potter Co. (Com.) Harris-Seybold-Potter Co. (7% Pfd., with Wts.) Harrison’s Orange Huts, Inc Harrods, Ltd. (Amer. Dep Rec. Ord. Reg.) Hart Carter Co. (Conv. Pref.) Hart-Parr Co. (Com.) Hart-Parr Co. (Part. Class “A” Pfd.) Hart, Schaffner & Marx (Com.) Hartford City Gas Light Co. (Com.) Hartford Electric Light Co Hartford Electric Light Co. (VTC) Hartford Times, Inc. (The) (Part. Pref.) . . Hartman Tobacco Co., Inc. (Com.) Havana Electric & Utilities Co. (Me.) ( 6 % 1st Pfd.) Havana Electric & Utilities Co. (Me.) (Cum. Pref.) Haverhill Gas Light Co Hawaiian Commercial & Sugar Co., Ltd. . . . Hawaiian Sugar Co Hayes Wheels & Forgings, Ltd. (Com.) . . . Haygart Corporation Hazel Atlas Glass Co Hazeltine Corporation Hecla Mining Co Hedley Gold Mining Co., Ltd Helena Rubinstein, Inc. (Com.) Henry Holt & Co., Inc. (Part “A”) Henry Klein & Co., Inc. (Part. Pfd.) 460 WALL STREET HNS HDN HWK HWK 1 Pr HWK 2 Pr HIB HIR HRS A HTU HOL HOY HLY HLY Pr HKL HFM HLS HOD HKR HOV HOVR HRL HOR HOR Pr HNR HNR Pr HKS HH A HOS HOS Pr WW HO Pr HNY HSS HB HLC HS HYD HYD Pr HBK HYP HYP Pr Herman Nelson Corp Heyden Chemical Corp. (Com.) Heywood Wakefield Co. (Com.) Heywood Wakefield Co. (7% 1st Pfd.) Heywood Wakefield Co. ( 1 % 2nd Pfd.) Hibbard, Spencer, Bartlett & Co Hiram Walker-Gooderham & Worts, Ltd. (Com.) Hires (Charles E.) Co. (“A” Com.) Hobart Manufacturing Co. (Com.) Hollinger Cons. Gold Mines, Ltd Holly Oil Company Holly Sugar Corp. (Com.) Holly Sugar Corp. (Pfd.) Homaokla Oil Co. (Com.) Home Eire & Marine Insurance Co Honolulu Consolidated Oil Co Hood Rubber Co. (Com.) Hooker Electrochemical Co Hoover Steel Ball Co Hoover Steel Ball Co. (Rights) Hormel (Geo. A.) & Company (Com.) Horn & Hardart Co. (Com.) Horn & Hardart Co. (7% Pfd. carrying Rts.) Horn (A. C.) Company (Com.) Horn (A. C.) Company (1st Pfd.) Hoskins Manufacturing Co. (The) Houdaille-Hershey Corp. (“A” Conv. Pref.) Houston Gulf Gas Co. (Com.) Houston Gulf Gas Co. (7% Pfd.) (Series “A”) with Wts Houston Oil Co. of Texas (Pfd.) Hudson Bay Mining & Smelting Co., Ltd. . . . Hugo Stinnes Corp Humble Oil & Refining Co Hussmann-Ligonier Co. (Com.) Huttig Sash & Door Co., Inc. (Com.) Huyler’s of Delaware, Inc. (Com.) Huyler’s of Delaware, Inc. (7% Pfd.) Hydraulic Brake Co Hydraulic-Press Brick Co. (Com.) Hydraulic-Press Brick Co. ( 6 % Pfd.) 461 WALL STREET HES HFO Hydro Electric Securities Corp. (Com.) . . . Hy grade Food Products Corp. (Com.) IDE IDE Pr IDL IC IPG A IPG B ILP IMP SR I Ide (Geo. P.) & Co. (Com.) Ide (Geo. P.) & Co. (Pfd.) Ideal Cement Co. (Com.) Illinois Brick Co Illinois Pacific Glass Corp. (“A” Com.) .... Illinois Pacific Glass Corp. (“B”) Illinois Pipe Line Co. (The) . . . ■ Imperial Chemical Ind., Ltd. (Full Paid Sub. Rec.) IMP Imperial Chemical Industries, Ltd. (Amer. Dep. Rec. Ord.) (Reg.) IMO G IMOR ITC ITC Pr IMT Imperial Oil, Ltd. (Coupon) Imperial Oil, Ltd. (Registered) Imperial Tob. Co. of Canada, Ltd. (Ord.) . . . Imperial Tob. Co. of Canada, Ltd. (Pref.) . . Imperial Tobacco Co. of Great Britain and ID INT ITY IDP IND IND Pr IFNV IFN Pr ILU ILU P Pr XW Ireland (Amer. Dep. Rec. for Ord.) Independent Pneumatic Tool Co India Tire & Rubber Co. (Com.) Indian Territory Illuminating Oil Co Indiana Pipe Line Co Indiana Service Corp. (Com.) Indiana Service Corp. (7% Pfd.) Industrial Finance Corp. (VTC Com.) Industrial Finance Corp. (7% Pfd.) Insull Utilities Investment, Inc. (Com.) .... Insull Utilities Investment, Inc. $5.50 Prior ILU II Pr WW Pfd. without Wts.) Insull Utilities Investments, Inc. ($6 Pfd., ISU IRX INUA ICT IPL INC 2nd Series, with Warrants) Insurance Co. of North America Insurance Securities Co., Inc Insuranshares Corp. of Dela. (“A” Com.) . . Intercoast Trading Co. (A New Co.) (Com.) Intercontinent Petroleum Corp International Cigar Machinery Corp. (Com.) 462 WALL STREET ICI INH IPF IY IMW IPU IPU Pr IPT ILW V 1ST B ISS Pr ITX ISP ITE IOX IU A IUB IU Pr XW IU WS IEU IEU CV Pr IHM IIS IIS Pr INGBR IHV IOP IFR V IRV IRV Pr ISL ISO ISO WS ITS A ITS DB R International Concrete Industries Corp. (Founders Shs.) International Holding & Investment Co., Ltd. International Perfume Co., Inc. (Com.) .... International Petroleum Co., Ltd. (New Com.) (Coupon) International Power Co., Ltd. (Com) International Products Corp. (Com.) International Products Corp. (6% Pfd.) . . . International Projector Corp. (Com.) International Rwy. Co. (Com. VTC) International Safety Razor Corp. (“B”) . . . International Shoe Co. (6% Pfd.) International Sleeping Car & European Ex- press Trains Co. (Wagon-Lits) (Amer. Dep. Rec. Ord.) (Bearer) International Superpower Corp International Tea Co.’s Stores, Ltd. (Amer. Dep. Rec. Ord. Reg.) International Textbook Co International Utilities Corp. (“A”) International Utilities Corp. (“B”) International Utilities Corp. ($7 Pfd., with- out Wts.) International Utilities Corp. (Warrants) . . . Interstate Equities Corp. (Com.) Interstate Equities Corp. ($3 Conv. Pfd. “A”) Interstate Hosiery Mills, Inc Interstate Iron & Steel Co. (Com.) Interstate Iron & Steel Co. (7% Pfd.) Interstate Natural Gas. Co., Inc. (Bond Rights) Irving Air Chute Co., Inc. (Com.) Iron Cap Copper Co. (Com.) Iron Fireman Mfg. Co. (VTC Com.) Isaac Silver & Bros. Co., Inc. (Com.) Isaac Silver & Bros., Inc. ( 7 % Conv. Pfd.) Isle Royale Copper Co. (N. J.) Isotta Fraschini Co. (Amer. Dep. Rec.) .... Isotta Fraschini (Stock Pur. Wts.) Italian Superpower Corp. (Com. “A”) Italian Superpower Corp. (Debenture Rts.) 463 WALL STREET JKT JM JEC JVD JY Pr JNO JWW JMC JOP JST JSU JSU Pr JL JKC JS KLZ KMZ KPU V KPU V Pr A KZ Pr KST KKN Pr KAW KNE ELY KGC KGC Pr KSW KSW Pr KRD KRY KER J Jackson Motor Shaft Co Jaeger Machine Co. (Com.) Jefferson Electric Co Jerome Yerde Development Co Jersey Central Pw. & Lt. Co. (Pfd., 7% Series) Johansen Bros. Shoe Co. (Com.) John Warren Watson Co. (Com.) Johnson Motor Co. (Com.) Johnson & Phillips, Ltd. (Amer. Dep. Rec. Ord.) (Reg.) Johnson-Stephens & Shinkle Shoe Co. (Com.) Jonas & Naumburg Corp. (Com.) Jonas & Naumburg Corp. ($3 Conv. Pfd.) . . Jones & Laughlin Steel Corp. (Com.) Julian & Kokenge Co. (Com.) Justice Gold & Silver Mining Co K Kalamazoo Stove Co Kalamazoo Vegetable Parchment Co Kansas City Public Service Co. (Mo.) (VTC Com.) Kansas City Public Service Co. (Mo.) (VTC Pfd. “A”) Kansas Gas & Elec. Co. (Pfd.) Karstadt (Rudolph), Inc. (Amer. Shs.) Kaufmann Dept. Stores, Inc. (Pfd.) Kawneer Company Kaynee Company (The) (Com.) Kelley Island Lime & Transport Co. (Com.) Kellogg Co. (Dela.) (Com.) Kellogg Co. (Dela.) (Pfd.) . . .' Kellogg Switchboard & Supply Co. (Com.) Kellogg Switchboard & Supply Co. (7% Pfd.) Ken-Rad Tube & Lamp Corp. (Com. “A”) . . Kentucky Rock Asphalt Co. (Dela.) (Com.) Kermath Manufacturing Co. (Com.) 464 WALL STREET KRR KYA KYS KTW KTW Pr KNR COD KLM KPC KLK KIR KIR Pr KLI KRW KNT KXH A KXH P Pr KXH KOB KOL KOP PR KRTR WI KRU Kerr Lake Mines, Ltd Keystone Aircraft Corp. (Com.) Keystone Mining Co Keystone Steel & Wire Co. (Com.) Keystone Steel & Wire Co. (7% Pfd.) Kinnear Stores Company (Ctfs. of Dep.) . . Kirby Lumber Co. (Com.) Kirby Petroleum Co Kirkland Lake Gold Mining Co., Ltd Kirsch Company (Com.) Kirsch Company (Conv. Pref.) Klein (D. Emil) Co., Inc. (Com.) Kleinert (I. B.) Rubber Co. (Com.) Knott Corporation (The) (Com.) Knox Hat Co., Inc. (“A” Com.) Knox Hat Co., Inc. (7% Prior Pfd.) Knox Hat Co., Inc. (New Non-Vt. Com.) . . . Kobackers Stores, Inc. (Com.) Kolster-Brandes, Ltd. (Amer. Shs.) Koppers Gas & Coke Co. ( 6 % Pfd.) Kreuger & Toll Co. (Rights) “WI” Kruskal & Kruskal, Inc. (Com.) L LNR LSW LCL LQU 0 LKE LKK LSC LAK LAK 1 Pr LKY LAS LOF LDY A XW LSY LMC LHC A ST Lackawanna Railroad Co., N. J Lackawanna Securities Co Laclede Steel Co L’Air Liquide (Amer. Dep. Rec. Series “O” Bearer Shs.) Lake Erie Bolt and Nut Co Lake Shore Mines, Ltd Lake Superior Corp Lake Torpedo Boat Co. (Com.) Lake Torpedo Boat Co. (1st Pfd.) Lakey Foundry & Machine Co. (Com.) Lamson & Sessions Co. (The) (Com.) Land Company of Florida Landay Bros., Inc. (“A” without Wts.) Landers, Frary & Clark Landis Machine Co. (Com.) Landover Holding Corp. (Stamped “A”) . . . 465 WALL STREET LNY LNY Pr WW LUBA LUBB LAN LSX LSX Pr LRT LPC LAZ COD LAZ LAZ Pr LEA LEA Pr LEE LEF LEF Pr LWC LWC Pr LCN LGN N WI LEM LFM LFM COD LNV LTZ LTZ WS LER LEY LJ LJ Pr LDP LBU LBU Pr LIL LIN LNO Lane Bryant, Inc. (Com.) Lane Bryant, Inc. (7% Pfd., with Wts.) . . . Langendorf United Bakeries, Inc. (“A” Stock) Langendorf United Bakeries, Inc. (“B” Stock) Lanston Monotype Machine Co La Salle Extension University (Com.) La Salle Extension University (7% Pfd.) . . Laurentide Co., Ltd Lawrence Portland Cement Co. (Com.) Lazuras (The F. & R.) Co. (COD Com.) . . . Lazuras (The F. & R.) & Co. (Com.) Lazuras (The F. & R.) & Co. (6 %% Pfd.) Leath and Co. (Com.) Leath and Co. ($3.50 Pfd.) Lee Mercantile Co. (The H. D.) Lef court Realty Corp. (Com.) Lef court Realty Corp. (Conv. Pref.) Lehigh & Wilkes-Barre Coal Co. (Com.) . . . Lehigh & Wilkes-Barre Coal Co. (Pfd.) .... Lehigh Coal & Navigation Co Lehigh Coal & Navigation Co. (New Com.) “WI” Lehman Corp. (The) Leonard Fitzpatrick, Mueller Stores Co. (Com.) Leonard Fitzpatrick, Mueller Stores Co. (Ctfs. of Dep.) Leonard Oil Development Co Leonard Tietz, Inc. (Com.) Leonard Tietz, Inc. (Stock Pur. Wts.) Lerner Stores Corp. (Com.) Ley (Fred T.) & Co., Inc Libby, McNeill & Libby (Com.) Libby, McNeill & Libby (Pfd.) Liberty Dairy Products Corp. (Com.) Library Bureau (Com.) Library Bureau (Pfd.) Lily-Tulip Cup Corp. (Com.) Lincoln Printing Co. (Com.) Lion Oil Refining Co. (Com.) 466 WALL STREET LIT LOB A LOBB LW DBR LW WS LTS R LSG LQB LLT LLT Pr LD LDIPr LD 2 Pr LSS LLX LOP A LOP B LOW LUY LMU LUW LUW Pr LKS LUK LYN LYNT LYO A Lit Bros Loblaw Groeerterias Co., Ltd. (“A” Stock) Loblaw Groeerterias Co., Ltd. (“B” Stock) . . Loew’s, Inc. (Debenture Rights) Loew’s, Inc. (Warrants) London Tin Syndicate, Ltd. (Amer. Dep. Rec. Ord.) (Reg.) Lone Star Gas Corp Long Bell Lumber Corp. (“B” Com.) Long Island Lighting Co. (Com.) Long Island Lighting Co. (7% Pfd.) Lord & Taylor (Com.) Lord & Taylor (1st Pfd.) Lord & Taylor (2nd Pfd.) Lorrain Silver Syndicate, Ltd Louisiana Land & Exploration Co. (Com.) . . Louis Philippe, Inc. (Part. Conv. “A” Com.) Louis Philippe, Inc. (“B” Com.) Lowell Electric Light Corp Lucky Tiger Combination Gold Mining Co.. . Ludlow Manufacturing Associates Ludwig Baumann & Co. (Com.) Ludwig Baumann & Co. (Conv. 7 % Pfd.) . . Lukens Steel Co Laukenheimer Co. (The) (Com.) Lynn Gas & Electric Co Lynn Gas & Electric Co. (Trust Ctfs.) .... Lyons (J.) & Co., Ltd. (Amer. Dep. Rec. “A” Ord. Reg.) MMS MML MD MAG MHO Pr MCR MCR Pr MLA MGE M Mac Marr Stores, Inc. (Com.) Macmillan Petroleum Corp Magdalena Syndicate (Com.) Magnin (I.) & Co., Inc. (Com.) Mahon (The R. C.) Co. (Conv. Pfd.) Maine Central R. R. Co. (Com.) Maine Central R. R. Co. ( 5 % Pfd.) Malacca Rubber Plantations, Ltd. (Amer. Dep. Rec. Ord. Reg.) Mangel Stores Corp. (Com.) 467 WALL STREET MGE Pr WW MAO MNW A MNWB MNY MNY WS MPR MIM MWEE MWEB MWE PR B MWE PR B MRO MOY MRM MNV MTP MAX MLD MVY MSU MSU Pr MSE MAM Pr MET MFW MAY Pr WW MTU B MRY WS MQY MJ Mangel Stores Corp. (6%% Pfd. with Wts.) Manhattan Oil Co. of Del. (Com.) Manning-Bowmann & Co. (Dela.) (Class “A”) Manning-Bowman & Co. (Dela.) (Class “B”) Mansfeld Mining & Smelting Co. (Com.) . . . Mansfeld Mining & Smelting Co. (Stk. Pur. Wts.) Mapes Consolidated Mfg. Co Marconi International Marine Communica- tion Co., Ltd. (Amer. Dep. Rec. for Ord.) (Reg.) Marconi’s Wireless Tele. Co., Ltd. (Amer. Dep. Rec. for Ord.) (Reg.) Marconi’s Wireless Tele. Co., Ltd. (Amer. Dep. Rec. for Ord. (Bearer) Marconi’s Wireless Tele. Co., Ltd. (Amer. Dep. Rec. for Pref.) (Reg.) Marconi’s Wireless Tele. Co., Ltd. (Amer. Dep. Rec. for Pref.) (Bearer) Margarine Union, Ltd. (Amer. Dep. Rec. for Ord.) Margay Oil Corp Marine Midland Corp Marion Steam Shovel Co. (Com.) Maritime Telegraph & Telephone Co., Ltd. (Com.) Marland Oil Co. of Mexico Maryland Casualty Co Mason Valley Mines Co Massachusetts Gas Co.’s (Com.) Massachusetts Gas Co.’s ( 4 % Pfd.) Massey-Harris Co., Ltd. (Com.) Matanzas-American Sugar Co. (Pfd.) Mavis Bottling Co. of America (Com.) Mayflower Associates, Inc. (Com.) May Hosiery Mills, Inc. ($4 Pref. with Wts.) McCord Radiator & Mfg. Co. (Class “B”) . . McCrory Stores Corp. (Stock Wts.) McQuay-Norris Mfg. Co. Mead Johnson & Co. (Com.) 468 WALL STREET MED MDW MES WS MPG MEU MST MST Pr MHU A MMU MMH MBV MGR MMY MEC MEC Pr A MSB MTX P Pr MTL MCI META MET B MET Pr MPV MPW MPWPr MOX MIG WS MGU MGU Pr MCT MID A MWT A MWU N WI MWUR MWU MWU Pr Mead Pulp & Paper Co. (The) (Com.) Meadows Manufacturing Co. (Com.) Melville Shoe Corp. (Warrants) Memphis Natural Gas Co. (Com.) Mendusa Portland Cement Co Mercantile Stores Co., Inc. (Com.) Mercantile Stores Co., Inc. (7% Pfd.) Merchants & Manufacturers Securities Co. (“A” Com.) Merchants & Miners Transportation Co. (The) Metal & Mining Shares, Inc. (Com.) Mercurbank (Vienna, Austria) (Amer. Shs.) Mergenthaler Linotype Co Marrimac Chemical Co Merritt-Chapman & Scott Corp. (Com.) .... Merritt-Chapman & Scott Corp. ( 6 ^/ 2 % “A” Pfd.) Mesabi Iron Co. (Com.) Metal Textile Corp. (Part. Pref.) Metal & Thermit Corp. (Com.) Metropolitan Chain Stores, Inc. (Com.) .... Metropolitan 5 to 50 Cent Stores, Inc. (Com. “A”) Metropolitan 5 to 50 Cent Stores, Inc. (Com. “B”) Metropolitan 5 to 50 Cent Stores, Inc. ( 8 % Pfd.) Metropolitan Paving Brick Co. (Com.) .... Mexican Lt. & Pw. Co., Ltd. (The) (Com.) Mexican Lt. & Pw. Co., Ltd. (The) (7% Pfd.) Mexico-Ohio Oil Co. (Com.) “Miag” Mill Machinery Co. (Stk. Pur. Wts.) Michigan Sugar Co. (Com.) Michigan Sugar Co. (Pfd.) Michigan Steel Tube Products Co. (Com.) . . Mid-Continent Laundries, Inc. (Part. “A”) Middle Western Telephone Co. (“A” Com.) Middle West Utilities Co. (New Com.) “WI” Middle West Utilities Co. (Rights) Middle West Utilities Co. (Com.) Middle West Utilities Co. (7% Pfd.) 469 WALL STREET MWU PL MWU 6 Pr MWU Pr R MWU N Pr ww wi MDY CV Pr MSP MDL MDUPL MVC MHT CV Pr MLO MLR Pr MGM MOD MHW CV Pr MG Pr MIR Pr MRP Pr MSI MKP MO MJV MOD MHKD MHK WS D MHK MHK 1 Pr MHK 2 Pr MHK WS MWM MKU MLE A MGH A MON MON Pr MPN Pr Middle West Utilities Co. (Prior Lien) Middle West Utilities Co. ($6 Pfd.) Middle West Utilities Co. (Pfd. Rights) .... Middle West Utilities Co. (New $6 Conv. “A” Pfd., with Wts.) Midland Royalty Corp. ($2 Conv. Pref.) . . . Midland Steel Products Co. (The) (Com.) . . Midland United Co. (Com.) Midland Utilities Co. (7% Prior Lien) Midvale Co. (Dela. Corp.) Miller and Hart, Inc. (Conv. Pref.) Miller (I.) & Sons, Inc. (Com.) Miller Rubber Co. (8% Pfd.) Milgrim (H.) & Bros. Inc. (Com.) Mining Corp. of Canada, Ltd Minneapolis-Honeywell Regulator Co. (7% Conv. Pfd.) Minnesota Pw. & Lt. Co. (7% Pfd.) Mirror (The) (7% Pfd.) Mississippi River Power Co. (Pfd.) Missouri-Illinois Stores Co. (Del.) (Com.) . . Missouri-Kansas Pipe Line Co. (Com.) .... Missouri Portland Cement Co Mock, Judson, Voehringer Co., Inc. (Com.) Modine Manufacturing Co Moliawk-Hudson Power Corp. (Dep. Rec. Com.) Mohawk-Hudson Power Corp. (Dep. Rec. Wts.) Mohawk-Hudson Power Corp. (Com.) Mohawk-Hudson Power Corp. ($7 1st Pfd.) Mohawk-Hudson Power Corp. ($7 2nd Pfd.) Mohawk-Hudson Power Corp. (Warrants) . . Mohawk Mining Co Mohawk Rubber Co. (Com.) Moloney Electric Co. (Class “A”) Monighan Manufacturing Corp. (Class “A” Stock) Monolith Portland Cement Co. (Com.) Monolith Portland Cement Co. (Pfd.) Monongahela West Penn Public Service Co. (7% Pfd.) 470 WALL STREET MRE MRER MTI DBR MTI Monroe Chemical Co. (Com.) Monroe Chemical Co. (Rights) Montecatini (Debenture Rights) Montecatini Mining & Agricultural Co., Inc. (Amer. Dep. Rec.) MLP MLP Pr MIV P Pr MF A MOP MEL MBL MOT Pr MGO MU MSW MSW Pr MOU MUL MNG MNG A MSV MPY MPY Pr MSK Montreal Light, Heat & Pw. Cons. (Com.) . . Montreal Light, Heat & Pw. Cons. ( 6 % Pfd.) Moody’s Investors Service (Part Pref.) Moore Drop Forging Co. (Class “A”) Morgan Lithograph Co. (Com.) Morison Electrical Supply Co., Inc. (Com.) Mortgage Bank of Colombia (Amer. Shs.) . . Motor Products Corp. (N. Y.) (Pfd.) Mountain & Gulf Oil Co Mountain Producers Corp Mountain States Power Co. (Com.) Mountain States Power Co. ( 7 % Pfd.) Mountain States Tel. & Tel. Co Mulford (II. K.) Co. (Com.) Muncie Gear Co. (Com.) Muncie Gear Co. (“A” Pfd.) Municipal Service Corp. (Com.) Murphy (G. C.) Co. (Com.) Murphy (G. C.) Co. (8% Pfd.) Muskegon Motor Specialties Co. (Conv. “A”) NSP NMC NHN NAN NVZ NAB NAB Pr NSV NBY Pr NBR NCD NCD 1 Pr NSK NSK Pr N Nachman-Springfield Corp Nashua Manufacturing Co. (Com.) Nathan Strauss, Inc. (Com.) National American Co., Inc National Aviation Corp National Baking Co. (Com.) National Baking Co. (7% Pfd.) National Bancservice Corp National Battery Co. (Dela.) (Pfd.) National Breweries, Ltd. (Com.) National Candy Co. (Com.) National Candy Co. (7% 1st Pfd.) National Casket Co., Inc. (Com.) National Casket Co. (Pfd.) 471 WALL STREET NCA NCA Pr NPT Pr A NET A NET B NET Pr NFM NFM Pr WW NFP NFP Pr NFU A WW NFU NFG NGO NGO Pr NIC NIC Pr NIC WS NAL NAL US NMU NPL 7 Pr NPU A NPUB NRP CV NRF NRU NTS NSL NSE NSY NSN NTYPr NTZ NTL NLL A NTJ NAT National Container Corp. (Com.) National Container Corp. ($2 Conv. Pfd.) . . National Dairy Products Corp. (Pfd. “A”) . . National Electric Power Co. (Class “A”) . . National Electric Power Co. (Class “B”) . . . National Electric Power Co. (7% Pfd.) .... National Family Stores, Inc. (Com.) National Family Stores, Inc. ($2 Pref. with Wts.) National Fireproofing Co. (Com.) National Fireproofing Co. (Pfd.) National Food Products Corp. (“A” with Wts.) National Food Products Corp. (Class “B”) National Fuel Gas Co. (Com.) National Grocer Co. (Com.) National Grocer Co. (6% Pfd.) National Investors Corp. (Com.) National Investors Corp. (5V2% Pfd.) National Investors Corp. (Warrants) National Leather Co. (New Com.) , National Leather Co. (Unstamped) National Manufacture & Stores Corp. (Com.) National Power & Light Co. (Non-Vot. $7 Pfd.) National Public Service Corp. (“A” Com.) . . National Public Service Corp. (“B” Com.) . . National Recording Pump Co. (Conv. Stock) National Refining Co. (The) (Com.) National Rubber Machinery Co. (The) (Com.) National Shirt Shops, Inc. (Com.) National Silk Dyeing Co. (Com.) National Screen Service Corp National Standard Co. (Mich.) National Sugar Refining Co. of N. J National Tea Co. (New 5 *4% Pfd.) National Theatre Supply Co. (Com.) National Tile Co. (Com.) National Toll Bridge Co. (“A” Com.) National Trade Journal, Inc National Transit Co 472 WALL STREET NUM NAH NAH Pr NAU NZO NEL NBK Pr NEC A NHI NHI Pr NEB Pr NPM A NMR NVC NVC Pr NEV NEVA NEV COD A NEV COD NAM NBG NBM NE NE Pr NBO NLY NCN NFO NER Pr NERT NEG NEG Pr NPV NPV PL NPV Pr NTT NEH NHV NVW National Union Radio Corp. (Com.) Nauheim Phamarcies, Inc. (Com.) Nauheim Pharmacies, Inc. (Conv. Pfd.) . . . Naumkeag Steam Cotton Co Navigazione Generale Italiana (Amer. Dep. Rec.) Nebel (Oscar) Co., Inc. (Com.) Nebraska Power Co. (Pfd.) Neet, Inc. (A Conv. Stock) Nehi Corporation (Com.) Nehi Corporation (1st Pfd.) Neisner Bros. Inc. (7% Conv. Pfd.) Neptune Meter Co. (N. J.) (“A” Com.) Nestle-LeMur Co. (The) (Class “A”) Nevada-California Elec. Corp. (Com.) Nevada-California Elec. Corp. ( 7 % Pfd.) . . Neve Drug Stores, Inc. (Com.) Neve Drug Stores, Inc. (Conv. “A”) Neve Drug Stores, Inc. (COD for “A” Conv.) Neve Drug Stores, Inc. (COD for Com.) . . . New Amsterdam Casualty Co New Bedford Gas & Edison Light Co New Britain Machine Co. (Com.) Newberry (J. J.) Co. (Com.) Newberry (J. J.) Co. (7% Pfd.) New Bradford Oil Co Newcastle-Upon-Tyne Elec. Supply Co., Ltd. (Amer. Dep. Rec. Ord. Reg.) New Cornelia Copper Co New England Fuel Oil Corp. (Nevada Corp.) New England Oil Ref. Co. ( 7 % Pfd.) New England Oil Ref. Co. (Trust Ctfs. Com.) New England Power Assn. (Com.) New England Power Assn. (6% Pfd.) New England Public Service Co. (Com.) . . . New England Public Service Co. ($7 Prior Lien Pfd.) New England Public Service Co. ($7 Pfd.) New England Tel. & Tel. Co New Haven Clock Co. (The) (Com.) New Haven Gas Light Co New Haven Water Co 473 WALL STREET NJZ NZ NEM NRR NWO NWO Pr NEO NOZ NQY NRV NRV Pr NYH NYA CNRWI NYG NYV NYV WS NYM NYY NYP 7 PR NYP 6 PR NYR NT Pr NYT NYZ NHP NHP A WS NHP B WS NIA NSZ NLS NLS NR NIL NHW A NPS NOB NOA NOM NTW Pr New Jersey Zinc Co New Mexico & Arizona Land Co Newmont Mining Corp New Orleans Great Northern R. R. Co. . . . New Orleans Public Service, Inc. (Com.) . . . New Orleans Public Service, Inc. (Pfd.) . . . Newport Company (The) (Com.) New Process Co. (Com.) New Quincy Mining Company New River Co. (The) (Com.) New River Co. (The) (6% Pfd.) New York & Honduras Rosario Mng Co. . . . New York Auction Co., Inc. (Com.) New York Central R. R. Co. (Rights) “WI” New York Hamburg Corp. (Gen. Stk.) .... New York Investors, Inc. (Com.) New York Investors, Inc. (Warrants) New York Merchandise Co., Inc. (Com.) . . . New York Petroleum Royalty Corp New York Power & Light (7% Pfd.) New York Power & Light Corp. ($6 Pfd.) . . New York, Rio & Buenos Aires Lines, Inc. . . New York Telephone Co. (6%% Pfd.) .... New York Transit Co New York Transportation Co Niagara Hudson Power Corp. (Com.) Niagara Hudson Power Corp. (“A” 15 yr. Opt. Wts.) Niagara Hudson Power Corp. (“B” Opt. Wts.) Niagara Share Corp. (Com.) Nicholas-Beazley Airplane Co., Inc Nichols & Shepard Co. (Com.) Nichols & Shepard Co. (Note Rights) Niles-Bement-Pond Co. (Com.) Nineteen Hundred Washer Corp. (“A” Stock) Nipissing Mines Co., Ltd. Noblitt-Sparks Industries, Inc Noma Electric Corp. (Com.) Noranda Mines, Ltd Northam Warren Corp. (Conv. Pref.) 474 WALL STREET NJU NAV NAC NCT NLP NLP Pr NOL NUY NUY 1 Pr NOV NOVT NTX NOS NES NESD NES A NI 7 PC Pr NI 6 PC Pr NMP NMP Pr NOH 6 Pr NOH 7 Pr NON NON Pr NPNWI NPP NNO NST NNS A NNS Pr NOT NOT Pr North & Judd Mfg. Co North American Aviation, Inc North American Car Corp. (Com.) North American Cement Corp. (Com.) North American Light & Power Co. (Com.) North American Light & Power Co. ($6 Pfd.) North American Oil Consolidated North American Utility Securities Corp. (Com.) North American Utility Securities Corp. ($6 1st, Pfd.) North Boston Lighting Properties (Com.) . North Boston Lighting Properties (Tr. Ctfs. for Com.) North Central Texas Oil Co., Inc. (Com.) . . . North Star Oil, Ltd. (Com.) Northeastern Power Corp. (Com.) Northeastern Power Corp. (Dep. Rec. Com.) Northeastern Power Corp. (Class “A”) Northern Indiana Public Service Co. ( 7 °/o Pfd.) Northern Indiana Public Service Co. (6% Pfd.) Northern Mexico Pw. & Dev. Co., Ltd. (Com.) Northern Mexico Pw. & Dev. Co., Ltd. (7% Pfd.) Northern Ohio Pw. & Lt. Co. (6% Pfd.) . . . Northern Ohio Pw. & Lt. Co. (7% Pfd.) . . . Northern Ontario Lt. & Pw. Co., Ltd. (Com.) Northern Ontario Lt. & Pw. Co., Ltd. (Pfd.) Northern Pacific-Great Northern (New Com.) “WI” Northern Paper Mills (Com.) Northern Pipe Line Co Northern Securities Stubs Northern States Power Co. (Dela.) (“A” Com.) Northern States Power Co. (Dela.) (7% Pfd.) Northern Texas Electric Co. (Com.) Northern Texas Electric Co. (6% Pfd.) .... 475 WALL STREET NWX NOG NOG Pr OSU OKP A OKPB OG OG Pr OH Pr OHS A OHS B OHS Pr OC OHO OHP Pr OPU A Pr OSV OLT A OLTB OKN COD OGE Pr ORR OLVA OLVB OY OUY OUY Pr ONT OPP V OCU OBD A OBDB OVU OVS OWX OWX Pr Northwest Engineering Co. (Com.) Novadel-Agene Coi’p. (The) (Com.) Novadel-Agene Corp. (The) ( 7 % Pfd.) .... 0 Oahu Sugar Co., Ltd Oakes Products Corp. (“A” Conv. Pref.) . . . Oakes Products Corp. (“B” Stock) Ogilvie Flour Mills Co., Ltd. (Com.) Ogilvie Flour Mills Co., Ltd. (7% Pfd.) . . . Ohio Bell Telephone Co. (The) (7% Pfd.) . . Ohio Brass Co. (The) (“A” Com.) Ohio Brass Co. (The) (“B” Com.) Ohio Brass Co. (The) (6% Pfd.) Ohio Copper Co. of Utah Ohio Oil Co Ohio Power Co. (6% Pfd.) Ohio Public Service Co. (The) (7% 1st Pfd. “A”) Ohio Seamless Tube Co. (Com.) Oilstocks Limited (“A” Stock) . '. Oilstocks Limited (“B” Stock) Oklahoma Natural Gas Co. (COD) Oklahoma Gas & Electric Co. (7% Pfd.) . . Old Colony Railroad Co Oliver United Filters, Inc. (Conv. “A”) Oliver United Filters, Inc. (“B” Stock) . . . Olympia Theatres, Inc. (Com.) Oneida Community, Ltd. (Com.) Oneida Community, Ltd. (Part. Pfd.) Ontario Manufacturing Co. (Com.) Oppenheimer (S.) & Co. (VTC Com.) Orange-Crush Co. (111.) Outboard Motors Corp. (“A” Conv. Pref.) . . Outboard Motors Corp. (“B” Com.) Overseas Securities Company, Inc Ovington Bros. Co. (Part. Pref.) Owl Drug Co. (The) (Com.) Owl Drug Co. (The) (8% Pfd.) 476 WALL STREET PKE PCB PCB Pr PCG 1 Pr PLT Pr PPW Pr PPU A PTC PWO PHT PAN POV PAI PAF V PAF Pr PRU FPNWI P Packard Electric Co. (Com.) Pacific Coast Biscuit Co. (Com.) Pacific Coast Biscuit Co. (Pfd.) Pacific Gas & Electric Co. (6% 1st Pfd.) . . . Pacific Lighting Corp. ($6 Pfd.) Pacific Power & Light Co. (Pfd.) Pacific Public Service Co. (“A” Com.) Pacific Tin Corp. (Special Stock) Pacific Western Oil Corp Page-Hersey Tubes, Ltd. (Com.) Pandem Oil Corp. (Com.) Pantepec Oil Co. of Venezuela Paraffine Co.’s (The) (Com.) Paragon Refining Co. (The) (VTC “B” Com.) Paragon Refining Co. (The) (“A” Pref.) . . . Paramount Cab Mfg. Corp. (Com.) Paramount Famous Lasky Corp. (New Com.) “WI” PKU Pr Parke, Austin & Lipscomb, Inc. (Conv. Part. Pfd.) PDC PER PRK PME PGU PSR PSX PCT Pr PMX POE POE 6 Pr POE P Pr POE WS POE B WS POED POE WS D Parke Davis & Co Parker Pen Co. (The) (Com.) Parker Rust-Proof Co. (Com.) Parmelee Transportation Co. (Com.) Patchogue Plymouth Mills Corp. (Com.) . . . Patterson-Sargent Co. (Com.) Peck, Stow & Wilcox Co. (The) Penn Central Lt. & Pw. Co. ($5 Pfd.) Penn-Mex Fuel Co. (Com.) Penn-Ohio Edison Co. (Com.) Penn-Ohio Edison Co. ($6 Pfd.) Penn-Ohio Edison Co. (7% Prior Pfd.) Penn-Ohio Edison Co. (Warrants) Penn-Ohio Edison Co. (“B” Warrants) Penn-Ohio Edison Co. (Dep. Rec. for Com.) Penn-Ohio Edison Co. (Rep. Rec. for Opt. Wts.) POE B WS D Penn-Ohio Edison Co. (Dep. Rec. for Opt. Wts. “B”) PNO V Pennroad Corp. (VTC Com.) 477 WALL STREET PNOVR PGE A POP 7 Pr POP 6 Pr PPL Pr PPL 6 Pr PSM PWW PDG PLW A PEP PEF PFV PEY PET Pr PEO PHP Pr PHL PMR PMRA P WS PWK PWK 7 Pr PWK 8 Pr PBK A PBK Pr PHY WS PD PBP PBP Pr PGV PLUA PJY PWF PNY PLE PBL Pennroad Corp. (The) (Rights) Pennsylvania Gas & Elec. Corp. (“A” Part. Stock) Pennsylvania-Ohio Pw. & Lt. Co. (7% Pfd.) Pennsylvania-Ohio Pw. & Lt. Co. ($6 Series Pfd.) Pennsylvania Power & Light Co. ($7 Pfd.) Pennsylvania Power & Light Co. ($6 Pfd.) Pennsylvania Salt Mfg. Co Pennsylvania Water & Power Co. (Com.) . . People’s Drug Stores, Inc. (MD) (Com.) . . . People’s Light & Power Corp. (“A” Com.) Pepperell Manufacturing Co Perfect Circle Co. (The) Perfection Stove Co Perryman Electric Co., Inc. (Com.) Pet Milk Co. (7% Pfd.) Petroleum Corp. of America Philadelphia Electric Power Co. (8% Pfd.) Philadelphia Traction Co Philip Morris Consolidated, Inc. (Com.) . . . Philip Morris Consolidated, Inc. (Class “A”) Philips Petroleum Co. (Stock Wts.) Pickwick Corp. (The) (Com.) Pickwick Corp. (7% Pfd.) Pickwick Corp. (The) (8% Pfd.) Pie Bakeries of Amer., Inc. (Class “A”) . . . Pie Bakeries of Amer., Inc. (7% Pfd.) Piedmont Hydroelectric Co. (SIP) (Stock Pur. Wts.) Piedmont & Northern Rwy. Co Pierce Butler & Pierce Mfg. Corp. (Com.) . . Pierce, Butler & Pierce Mfg. Corp. (8% Pfd.) Pierce Governor Co. (Com.) Pilot Radio & Tube Corp. (“A” Stock) .... Pinchin, Johnson & Co., Ltd. (Amer. Shs.) . . Pines Winterfront Co. (New) Pitney-Bowes Postage Meter Co Pittsburgh & Lake Erie R. R. Co Pittsburgh, Bessemer & Lake Erie R. R. Co. (Com.) 478 WALL STREET PBL Pr PGH PPG PG PLY PYO PYT POP PEN PLP POT POU PDR POW POW 1 Pr PWS PWS Pr PM PL PTN P CV PBR PRW PRW Pr PRZ PGM 8 Pr PRP PVY PVY R WI PRN Pr PUV PSIX PSI PSI 6 Pr PSI 7 Pr PUW Pr PI QRS QO Pittsburgh Bessemer & Lake Erie R. R. Co. (6% Pfd.) Pittsburgh Oil & Gas Co Pittsburgh Plate Glass Co. (Com.) Pittsburgh Steel Co. (Com.) Plymouth Cordage Co Plymouth Oil Company (Com.) Polymet Mfg. Corp. (Com.) Pond Creek Pocahontas Co Poole Engineering & Machine Co Portland Electric Power Co. (Com.) Potosi Gold & Silver Mining Co Potrero Sugar Co. (Com.) Powdrell & Alexander, Inc. (Com.) Power Corp. of Canada, Ltd. (Com.) Power Corp. of Canada, Ltd. ( 6 % 1st Pfd.) Power Securities Corp. (Com.) Power Securities Corp. (Non-Cum. 2nd Pfd.) Pratt & Lambert, Inc Premier Gold Mining Co., Ltd Prentice-Hall, Inc. (Part. Conv.) Price Bros. Co., Ltd. (Com.) Prince & Whitely Trading Corp. (Com.) . . . Prince & Whitely Trading Corp. (Conv. Pfd. “A”) Printz-Biederman Co. (The) (Com.) Procter & Gamble Co. (The) ( 8 % Pfd.) .... Propper Silk Hosiery Mills, Inc. (Com.) . . . Providence Gas Co Providence Gas Co. (Rights) “WI” Prudence Co., Inc. (7% Pfd.) Prudential Investors, Inc. (Com.) Public Service Co. of No. 111. (Com.) Public Service Co. of No. 111. (Com.) Public Service Co. of No. 111. (6% Pfd.) . . . Public Service Co. of No. 111. (7% Pfd.) . . . Puget Sound Pw. & Lt. Co. (6% Pfd.) Pyrene Mfg. Co., Inc. (Com.) Q Q. R. S. De Vry Corp. (Com.) Quaker Oats Co. (Com.) 479 WALL STREET QO Pr QC QU Quaker Oats Co. (6% Pfd.) Queen Creek Copper Co. . . Quincy Mining Co RAD RYS RNW RNWB RKX WS RAP RHP RST RCL RCL CV Pr RTN V RED RWO RBH RSH Pr RFO RES RBZ RMG RMC RR DB R RPT RB WS RMT V RMT Pr REY RLM RWE WS RP A RP Pr RW RHL WS RSV R Radio Products Corp. (Com.) Railway & Light Sec. Co. (Dela.) (Com.) . . . Rainbow Luminous Products, Inc. (“A” Com.) Rainbow Luminous Products, Inc. (“B” Com.) Rand Kardex Bureau, Inc. (Warrants) .... Rapid Electrotype Co. (The) Rath Packing Co. (The) (Com.) Raybestos Co. (The) (Com.) Raymond Concrete Pile Co. (Com.) Raymond Concrete Pile Co. ($3 Conv. Pfd.) Raytheon Mfg. Co. (VTC Com.) Red Bank Oil Co.) Red Warrior Mining Co Reece Buttonhole Machine Co Regal Shoe Co. (Pfd.) Reiter-Foster Oil Corp Reliable Stores Corp. (Com.) Reliance Bronze & Steel Corp. (Com.) Reliance Management Corp. (Com.) Reliance Manufacturing Co. (Ohio Corp.) . . Remington Rand, Inc. (Deb. Rights) Repetti, Inc Republic Brass Corp. (Warrants) Republic Motor Truck Co., Inc. (YTC Com.) Republic Motor Truck Co., Inc. (7% Pfd.) Reynolds Bros. Inc. (Dela. Corp.) Reynolds Metals Co. (Com.) Rhine- Westphalia Elec. Pw. Corp. (War-. rants) Rhode Island Public Service Co. (Class “A”) Rhode Island Public Service Co. ($2 Pfd.) Rice Stix Dry Goods Co. (Com.) Richard Hellmann, Inc. (Warrants) Richardson Co. (The) (Com.) 480 WALL STREET RIL Pr XW RCM RRD RRD Pr RRD - C V Pr RIC RIC Pr RIK RTV RTV Pr RVW RNO RCP RGS B Pr RGS C Pr RGS D Pr RCKT ROL CV Pr ROY Pr RRO RVF RSG RE ROO P Pr ROO RTI RPL RUB RGU RSK RUD RYN RYE Richfield Oil Co. of Cal. (Del.) (7% Pfd. without Wts.) Richman Bros. Co. (New) Richmond Radiator Co. (Com.) Richmond Radiator Co. (Pfd.) Richmond Radiator Co. (7% Convert. Pfd.) Rich’s, Inc. (Com.) Rich’s, Inc. (6V2 % Conv. Pfd.) Rike-Kumler Co. (Com.) Rio Tinto Co., Ltd. (Amer. Dep. Rec. for Ord.) (Bearer) Rio Tinton Co., Ltd. (Amer. Dep. Rec. for Pref.) (Bearer) River Raisin Paper Co Roan Antelope Copper Mines, Ltd. (Amer. Shs.) Rochester Central Power Corp. (Com.) .... Rochester Gas & Elec. Corp. (7% “B” Pfd.) Rochester Gas & Elec. Corp. (6% “C” Pfd.) Rochester Gas & Elec. Corp. (6% “D” Pfd.) Rockland Light & Power Co. (Stk. Tr. Ctfs.) Rollins Hosiery Mills, Inc. ($3.60 Conv. Pfd.) Rolls-Royce of America, Inc. [7°/o Pfd.) .... Rolls-Royce, Ltd. (Amer. Dep. Rec. Ord.) (Reg.) Roosevelt Field, Inc Ross Gear & Tool Co. (Com.) Ross Stores, Inc. (The) (Com.) Root Refining Co. (Conv. Prior Pref.) Root Refining Co. (Com.) Royal Typewriter Co., Inc. (Com.) Rubber Plantations Investment Trust Ltd. (Amer. Dep. Rec. Ord. Reg.) Ruberoid Co Rudolph Guenther-Russell Law, Inc. (Com.) Russeks Fifth Avenue, Inc Ruud Manufacturing Co. (Com.) Ryan Cons. Petroleum Corp Ryerson (Joseph T.) & Son, Inc 481 WALL STREET SFY SAF 0 WS SAF II WS SAL STL SLP SLR SMR SRT SET Pr SCK SKP STR SFM SEC SFO SJL S JL A Pr SJL B Pr SVU SVU Pr SVY SCF SCL A SCL Pr SLZ SLZ Pr SRE SHT SHT Pr SHT R SJC A SCO SVM SUS P Pr SNG SNG 1 Pr SEG SEE S Safety Car Heating & Lighting Co. (Com.) . . Safeway Stores, Inc. (Old 5th Warrants) . . Safeway Stores, Inc. (2nd Series Warrants) St. Anthony Gold Mines, Ltd St. Louis Car Co. (Com.) St. Louis Independent Packing Co. (Com.) St. Louis Rocky Mt. & Pac. Co. (Com.) . . . St. Mary’s Mineral Land Co St. Regis Paper Co. (Com.) St. Regis Paper Co. (7%) Pfd Salt Creek Cons. Oil Co Salt Creek Producers Assn., Inc Samson Tire & Rubber Co. (Com.) Sanford Mills (Com.) Sangamo Electric Co. (Com.) San Francisco Mines of Mexico, Ltd. (Amer. Dep. Rec. Ord. Reg.) San Joaquin Lt. & Pw. Corp. (Com.) San Joaquin Lt. & Pw. Corp. (7% “A” Pfd.) San Joaquin Lt. & Pw. Corp. (6% “B” Pfd.) Savannah Sugar Refining Corp. (Com.) .... Savannah Sugar Refining Corp. (7% Pfd.) Savoy Oil Co Schiff Co. (The) (Com.) Schlesinger (B. F.) & Sons, Inc. (“A” Com.) Schlesinger (B. F.) & Sons, Inc. (7% Pfd.) Schletter & Zander, Inc. (VTC. Com.) Schletter & Zander, Inc. (Conv. Pref.) .... Schulte Real Estate Co., Inc. (Com.) Schulte-United 5c to $1 Stores, Inc. (Com.) Schulte-United 5c to $1 Stores, Inc. ( 7 % Conv. Pfd.) Schulte-United 5c to $1 Stores, Inc. (Rights) Sehutter- Johnson Candy Co. (“A” Conv.) . Scotten Dillon Co Scovill Manufacturing Co Scullin Steel Co. (Part. Pref.) Securities Corp. General (Com.) Securities Corp. General (1st Pfd.) Segal Lock & Hardware Co., Inc. (Com.) . . Seeman Bros., Inc. (Com.) 482 WALL STREET SUV SUV Pr SBY SLE II Pd SLE SLE Pr SPV SER SVD V Pr SEL SDH SDE SWW SHE SSL SAH SAH CV Pr SRW SHW SVO SBL SHS SPE SPE Pr SPER SND SND Pr SND WS SIK SIGV SGP SGP Pr SKM SBO CV Pr SMF SIL Seiberling Rubber Co. (Com.) Seiberling Rubber Co. (8% Pfd.) Selby Shoe Co. (The) (Com.) Selected Industries, Inc. (Allot. Ctfs., 1st and 2nd Paid $75) Selected Industries, Inc. (Com.) Selected Industries, Inc. ($5.50 Div. Prior Stk.) Selfridge Provincial Stores, Ltd. (Amer. Dep. Rec.) Sentry Safety Control Corp Servel, Inc. (VTC. for Pfd.) Seton Leather Co. (Com.) Sharpe & Dohme, Inc. (Com.) Shattuck Denn Mining Corp. (Com.) Shawinigan Water & Power Co Sheaffer (W. A.) Pen Co. (Com.) Sheffield Steel Corp. (Com.) Shenandoah Corp. (The) (Com.) Shenandoah Corp. (The) (Opt. 6% Conv. Pref. Series of 1929) Sherwin-Williams Co. of Canada, Ltd. (Com.) Sherwin-Williams Corp. (Com.) Shreveport-El Dorado Pipe Line Co., Inc. . . . Sidney Blumenthal & Co. Inc. (Com.) Siemens & Halske A. G. (Berlin) (Amer. Dep. Rec. Com.) Sierra Pacific Electric Co. (Com.) Sierra Pacific Electric Co. (6% Pfd.) Sierra Pacific Electric Co. (Rights) Signode Steel Strapping Co. (Com.) Signode Steel Strapping Co. (Pref.) Signode Steel Strapping Co. (Warrants) . . . Sikorsky Aviation Corp. (Com.) Silica Gel Corp. (VTC. Com.) Silica Gel Products Corp. (Com.) Silica Gel Products Corp. (Pfd.) Silver King Coalition Mines Co Simmons-Boardman Pub’ng Co. (Conv. Pfd.) Singer Manufacturing Co Singer Manufacturing Co., Ltd 483 WALL STREET SOX Pr SIS SKO AOS AOS Pr SVS SVSI SGO SLO SNC SAG SSX SP SEP WS SEP SEP V SEP Pr SEP P Pr SEP D SEP WS D SOL SSZ SCE Pr SCE A Pr SCE B Pr SCE C Pr SPN SCUA SCU Pr SCW A SOR SGY A SGY SUI A Sioux City Gas & Elect. Co. (7% Pfd.) .... Sisto Financial Corp Skinner Organ Co. (Com.) Smith (A. 0.) Corp. (Com.) Smith (A. 0.) Corp. (Pfd.) Snia-Viseosa (Ord. Shs.) Snia-Viscosa (Inter. Rec. Chase Nat. Bank) Societa Generale Elettrica dell’ Adamello (Amer. Dep. Rec. Com.) Solar Refining Co Sonora Products Corp. of America (Com.) . . South American Gold & Platinum Corp South Coast Co. (The) (Com.) South Penn Oil Co Southeastern Pr. & Lt. Co. (Option War- rants Southeastern Pw. & Lt. Co. (Com.) Southeastern Pw. & Lt. Co. (VTC Com.) .... Southeastern Pw. & Lt. Co. ($7 Pfd.) Southeastern Pw. & Lt. Co. (Part. Pfd.) Southeastern Power & Light Co. (Dep. Rec. for Com.) Southeastern Power & Light Co. (Dep. Rec. for Opt. Wts.) Southern Acid & Sulphur Co. (Com.) Southern Asbestos Co. (Com.) Southern California Edison Co. (Orig. 8% Pfd.) Southern California Edison Co. (7% Pfd. “A”) Southern California Edison Co. (6% Pfd. “B”) Southern California Edison Co. (5 %% “C” Pfd.) Southern Canada Power Co., Ltd. (Com.) . . . Southern Cities Utilities Co. (“A” Com.) . . . Southern Cities Utilities Co. (7% Pfd.) Southern Colorado Power Co. (Class “A”) . . Southern Corporation (Com.) Southern Grocery Stores, Inc. (Com. “A”) . . Southern Grocery Stores, Inc. (Com.) Southern Ice & Utilities Co. (“A” Com.) .... 484 WALL STREET fck*. — SUIB SNE SPS SPL SPU SSP A SUT SUT Pr SRO SOD SOD Pr WW SOE SWP SWB Pr SPW Pr SGCR SGCB SMS PR SXY SQUA SQUB SLM SLY Pr STS SCS SDT Pr SDR SDR CV Pr SGPPr STD Pr WW SMO SN SEA SKY SNB SOH SOH Pr SWD Southern Ice & Utilities Co. (“B” Com.) .... Southern New England Telephone Co Southern Phosphate Corp Southern Pipe Line Co Southern Public Utilities Co Southern Stores Corp. (Part Class “A”) .... Southern Utilities Co. (Com.) Southern Utilities Co. ( 7 % Pfd.) Southland Royalty Co. (Com.) Southwest Dairy Products Co. (Com.) Southwest Dairy Products Co. ( 7 % Pfd., with Wts.) Southwest Gas Utilities Corp. (Com.) South West Pennsylvania Pipe Lines Southwestern Bell Tel. Co. ( 7 % Pfd.) Southwestern Pw. & Lt. Co. (Pfd.) Spanish & General Corp., Ltd. (Amer. Dep. Rec. for Ord.) (Reg.) Spanish & General Corp. Ltd. (Amer. Dep. Rec. for Ord. (Bearer) Spiegel, May, Stern Co., Inc. (6^2% Pfd.) . . Springfield Gas Light Co. (Mass.) Square D Co. (“A” Pfd. with Wts.) Square D Co. (“B” Com.) Stahl-Meyer, Inc. (Com.) Staley (A. E.) Manufacturing Co. ( 7 % Pfd.) Stamford Gas & Electric Co. (The) Standard Cap & Seal Corp Standard Commercial Tob. Co., Inc. (Pfd.) . . Standard Dredging Co. (Com.) Standard Dredging Co. (Convert. Pref.) .... Standard Gas & Elec. Co. (7% Prior Pref.) . . Standard Investing Corp. ($5.50 Pfd. with Wts.) Standard Motor Construction Co. (Com.) . . Standard Oil Co. (of Indiana) Standard Oil Co. (of Kansas) Standard Oil Co. (of Kentucky) Standard Oil Co. (of Nebraska) Standard Oil Co. (of Ohio) (Com.) Standard Oil Co. (of Ohio) (Pfd.) Standard Power & Light Corp. (Del.) (Com.) 485 WALL STREET SWD Pr SPC A SSC SSM SSG SSG COD SDP STK STK 1 Pr STP STP A Pr STP B Pr SWY STC STC Pr STE STE Pr STT STT Pr SCM SBI SMT Pr STN A STN V SET SXB SUR SWC Pr STO SOK SWV SDO SDO A SUZ SUL SUY SIN Standard Power & Light Corp. (Del.) (Pfd.) Standard Publishing Corp. (Class “A”) . . . Standard Screw Co. (Com.) Standard Silver-Lead Mining Co Standard Steel Propeller Corp. (Com.) .... Standard Steel Propeller Corp. (Ctfs. of Dep.) Standard Steel Spring Co. (Com.) Standard Tank Car Co. (Com.) Standard Tank Car Co. ( 8 % 1st Pfd.) Standard Textile Products Co. (Com.) Standard Textile Products Co. (7% “A” Pfd.) Standard Textile Products Co. ( 1 % “B” Pfd.) • Stanley Works (The) (Com.) Starrett Corp. (The) (Com.) Starrett Corp. (The) (6% Pfd., with Privi- lege) Steel Co. of Canada, Ltd. (Ord.) Steel Co. of Canada, Ltd. (Pref.) Stein (A.) & Company (Com.) Stein (A.) & Company (6^% Pfd.) ....... Stein Cosmetics Co., Inc. (Com.) Sterchi Bros. Stores, Inc. (Com.) Sterling Motor Truck Co. (Conv. Pfd.) .... Stern Bros. (Class “A”) Stern Bros. (YTC Com.) Stetson (John B.) Co. (Com.) Stix, Baer & Fuller Co. (Com.) Strauss-Roth Stores, Inc. (Com.) Strawbridge & Clothier (7% Pfd.) Stromberg-Carlson Tele. Mfg. Co. (Com.) . . Stroock (S.) & Co., Inc Struthers Wells-Titusville Corp. (Com.) .... Studebaker Mail Order Co. (Com.) Studebaker Mail Order Co. (“A” Stock) .... Stutz Motor Car Co. of America, Inc Sullivan Machinery Co Sunray Oil Corp. (Dela.) Sun Investing Co., Inc. (Com.) 486 WALL STREET SIN Pr SUO Pr WW SPH SI WSB SPR A SPT SU SWO SWO Pr SWE A SWEB SWI SWX SDI Pr WW SYWB TAG TE TGK TAY THU TC V TEP 7 Pr TNU THI THI Pr TER TXP Pr TEX THR THR Pr TNI TPR A Sun Investing Co., Inc. ($3 Conv. Series Pfd.) Sunset Stores, Inc. ($3.50 Pfd. with Wts.) . . Superheater Co. (The) Superior Oil Corp. (“B” Option Wts.) Superior Portland Cement, Inc. (“A” Part.) Super Maid Corp. (Com.) Sutherland Paper Co. (Com.) Swan-Finch Oil Corp. (Com.) Swan-Finch Oil Corp. (1% Pfd.) Swedish Match Co. (Class “A” Stock) .... Swedish Match Co. (Class “B” Stock) Swift Internacional (Compania) Swift & Co Swiss- American Elec. Co. ($6 Pfd. with Wts.) 518 Swiss Francs, equals Syracuse Washing Machine Corp. (“B” Com.) T Taggart Corporation (Com.) Tampa Electric Co. (Com.) Tanganyika Concessions, Ltd. (Amer. Dep. Rec. Ord. Reg.) Taylor Milling Corp. (Com.) Teck-Hughes Gold Mines, Ltd Tennessee Cent. Rlwy Co. (VTC for Com.) . . Tennessee Elec. Pw. Co. (7% 1st Pfd.) Tennessee Products Corp. (Com.) Terre Haute, Indianapolis & East. Trac. Co. (Com.) Terre Haute, Indianapolis & East. Trac. Co. (5% Pfd.) Terni-Societa per L’Industria e L’Elettricita (Amer. Dep. Rec.) Texas Power & Light Co. (7% Pfd.) Texon Oil & Land Co Thermoid Company (Com.) Thermoid Company (7% Conv. Pfd.) Third National Investors Corp. (Com.) .... Thompson Products, Inc. (“A” Stock) 487 WALL STREET TPRB TST TST Pr XW TPO TDX Pr TNS TIS TAB TOP TOD TDY A TDY A COD TDY B COD TDY VB TED 7 Pr TED 6 Pr TBL TPM TOR TRM TRMR WI TAN TAN V TON Pr TON BR TLX TRA TRS TCP U TCL TCL PR WW TSX TT TT Pr TRU TUY TS TS DBR Thompson Products, Inc. (“B” Stock) Thompson-Starrett Co., Inc. (Com.) Thompson-Starrett Co., Inc. ($3.50 Pref., without Wts.) Thurber Earthern Products Co Timken-Detroit Axle Co. (The) (Pfd.) Tin Selection Trust, Ltd. (Amer. Dep. Rec. Reg. Shs.) Tishman Realty & Const. Co., Inc Tobacco & Allied Stocks, Inc Tobacco Products Export Corp Todd Shipyards Corp Toddy Corp. (Class “A” Stock) Toddy Corp. (COD. for “A”) Toddy Corp. (COD. for “B” VTC) Toddy Corp. (VTC for “B” Com.) Toledo Edison Co. (7% Pref. “A”) Toledo Edison Co. (Pref. 6 % Series) Tonopah Belmont Dev. Co Tonopah Mining Co. of Nevada Torrington Co. of Maine (The) Transamerica Corporation Transamerica Corp. (Rights) “WI” Transcontinental Air Transport, Inc Transcontinental Air Transport, Inc. (VTC) Transcontinental Oil Co. (7% Pfd.) Transcontinental Oil Co. (Bond Rights) .... Trans Lux Daylight Picture Screen Corp. (Com.) Travel Air Company Traveler Shoe Stores Corp. (Com.) Tri-Continental Allied Co., Inc. (Unit Ctfs.) Tri-Continental Corp. (Com.) Tri-Continental Corp. (6% Pfd. with Wts.) . Triplex Safety Glass Co., Ltd. (Amer. Dep. Rec. for Ord.) (Reg.) Tri-State Tel. & Tel. Co. (Com.) Tri-State Tel. & Tel. Co. (6% Pfd.) Tri-Utilities Corp. (Com.) Troy Laundry Machinery Co., Ltd., (Com.). Trumbull Steel Co. (Com.) Trumbull Steel Co. (Debenture Rights) .... 488 WALL STREET TNZ Trunz Pork Stores, Inc TUX Pr Truscon Steel Co. (7% Pfd.) TUZ B V Tubize Artificial Silk Co. of Amer. (VTC “B” Com.) ; TUL Tulip Cup Corp. (Com.) TUW Tung-Sol Lamp Works, Inc. (Com.) TUW Pr Tung-Sol Lamp Works, Inc. ($3 Conv. Pref.) ULE UER UAI UGS BR ULS UNG UOL UST UOS UTC UTP UTW UCB PR UCF UCH UCH P Pr UWS UDO UES UEC USY USY BR UEY UNT UGE Pr UHA Pr UO UNL A UNLB UNL CV Pr U Ulen & Company (Com.) Underground Elec. Rwys. Co. of London, (Amer. Dep. Rec. Ord. Reg.) Union American Investing Corp. (Com.) . . . Union Gas Utilities, Inc. (Bond Rights) Union Mills, Inc. (Com.) Union Natural Gas Co. of Canada, Ltd Union Oil Associates, Inc Union Steel Castings Co. (Com.) Union Stock Yards Co. of Omaha, Ltd Union Tobacco Co. (The) (Com.) Union Traction Co. (Pa.) ($17.50 Paid in) . . . Union Twist Drill Co. (Com.) United Carbon Co. (Pfd.) United-Carr Fastener Corp. (Com.) United Chemicals, Inc. (Com.) United Chemicals, Inc. ($3 Cum. & Part. Pfd.) United Corp. (The) (Option Wts.) United Dry Docks, Inc. (Com.) United Eastern Mining Co United Elastic Corp United Electric Service Co. (Amer. Shs.) . . . United Electric Service Co. (Bond Rights) . . United Engineering & Foundry Co. (Com.) . . United Gas Company (Com.) United Gas & Elec. Corp. (Pfd.) United Hotels Co. of Amer. ( 1 % Pfd.) United Illuminating Co United Light & Power Co. (“A” Com.) United Light & Power Co. (“B” Com.) .... United Light & Power Co. ($6 Conv. 1st Pfd.) 489 WALL STREET UMK UMK PR UMO UMOPr UVW UPR UPRPr UI UlPr UPV URF URS A XW URSB URC Pr URCA URC VB URE USH USH Pr UIN II Pd UTS UCN UDIA UDIB USV USN USNPr USPB USG USGPr UTTPR ULU USP United Milk Products Corp. (Com.) United Milk Products Corp. (7% Pfd.) United Molasses Co., Ltd. (Amer. Dep. Rec. Ord. Reg.) United Molasses Co., Ltd., (Amer. Dep. Rec. 6% Pref.) United New Jersey R. R. & Canal Co United Porto Rican Sugar Co. (Com.) United Porto Rican Sugar Co. (Cony. Part. Pfd.) United Profit Sharing Corp. (Com.) United Profit Sharing Corp., (10% Pfd.) . . . United Public Service Co. (Com.) United Rayon Factories A. G. (Amer. Depi Rec.) United Reproducers Corp. (“A” Stock with- out Wts.) United Reproducers Corp. (“B” Stock) .... United Retail Chemists Corp. (Pfd.) United Retail Chemists Corp. (“A” Stk.) . . . United Retail Chemists Corp. (VTC for “B” Stock) United Rwys. & Elect. Co. of Balto. (Com.) . United Shoe Machinery Corp. (Com.) United Shoe Machinery Corp. (Pfd.) United States & International Securities Corp. (Allot. Ctfs., Part Paid) ($50) United States Asbestos Co. (Com.) United States Can Co. (Com.) United States Dairy Products Corp. (“A” Com.) United States Dairy Products Corp. (“B” Com.) United States Envelope Co. (Com.) United States Finishing Co. (Com.) United States Finishing Co. (Pfd.) United States Foil Co., Inc. (“B” Com.) .... United States Gypsum Co. (Com.) United States Gypsum Co. (Pfd.) United States Lines, Inc. (Pref.) United States Lumber Co United States Playing Card Co. (Com.) 490 WALL STREET USP COD UPL UPLN UNS UNS V UNS Pr USU USU Pr USU P Pr USU A Pr UNF WW USSA USSB USS P Pr USS Pr USR UVE UWP UZZ UGM UA UNV UVP UVP Pr R UNP UXX UMT UPW Pr UTU UT Pr UTK ULVB UL ULY United States Playing Card Co. (Ctfs. of Dep.) United States Printing & Lithograph Co. (Com.) United States Printing & Lithograph Co. (New Com.) United States Radiator Corp. (Com.) United States Radiator Corp. (VTC Com.) . United States Radiator Corp. (7% Pfd.) . . . U. S. Rubber Reclaiming Co., Inc. (Com.) . . . U. S. Rubber Reclaiming Co., Inc. (8% Pfd.) U. S. Rubber Reclaiming Co., Inc. (Prior Pref.) U. S. Rubber Reclaiming Co., Inc. (“A” Pfd.) United States Shares Financial Corp. (with Wts.) United States Stores Corp. (“A” Com.) .... United States Stores Corp. (“B” Com.) .... United States Stores Corp. (7% Prior Conv. Pfd.) United States Stores Corp. (8% Pfd.) United Stores Corp. (Com.) United Verde Extension Mining Co United Wall Paper Factories, Inc. (Com.) . . United Zinc Smelting Corp Unity Gold Mines Co Universal Aviation Corp. (Com.) Universal Insurance Co Universal Pictures Co., Inc. (Com.) Universal Pictures Co., Inc. (Pfd. Rights) . . . Universal Products Co., Inc Utah Apex Mining Co Utah Metal & Tunnel Co Utah Power & Light Co. ($7 Pfd.) Utah Radio Products Co. (Com.) Utica Gas & Electric Co. ( 7 % Pfd.) Utica Knitting Co. (Com.) Utilities Power & Light Corp. (VTC “B”) . . . Utilities Power & Light Corp. (Non-Vt. Com.) Utility and Industrial Corp. (Com.) 491 WALL STREET ULYPr UY VZ VA Pr VAN VMKPrWW VI VI Pr VDR VMO VMOPr VZP VB VIC VKL VKP VKP Pr WW VR V VEL VOT VOC VOCPR WAO WSO WGR WHL WHLPr WAT A WATB WAG WAG WS WLR WWK A WWKB WWK Pr Utility and Industrial Corp. (Conv. Pfd.) . . Utility Equities Corp. (Com.) V Vacuum Oil Co Valvoline Oil Co. (Pfd.) Vanadium-Alloys Steel Co Van Camp Milk Co. (7% Pfd. with Wts.) . . Van Camp Packing Co., Inc. (Com.) Van Camp Packing Co., Inc. (7% Pfd.) .... Veeder-Root, Inc Venezuelan Mexican Oil Corp. (Com.) Venezuelan Mexican Oil Corp. (Pfd.) Venezuelan Petroleum Co Vesta Battery Corp. (Com.) Vick Financial Corp. (Com.) Vickers, Ltd. (Amer. Dep. Rec. Ord. Reg.) . . Viking Pump Co. (Com.) Viking Pump Co. (Pfd., with Wts.) Virginian Railway Co. (The) (VTC Com.) . . Vlchek Tool Co. (The) (Com.) Vogt Manufacturing Corp V. 0. C. Holding Co., Ltd. (Amer. Dep. Rec. for Ord.) (Reg.) V. O. C. Holding Co., Ltd. (Amer. Dep. Rec. for Pref.) (Reg.) W Waco Aircraft Co. (The) Wabasso Cotton Co., Ltd. (Com.) Wagner Electric Corp. (Com.) Wahl Co. (The) (Com.) Wahl Co. (The) (7% Pfd.) Waitt & Bond, Inc. (Class “A” Stock) Waitt & Bond, Inc. (Class “B” Stock) Walgreen Co. (Com.) Walgreen Co. (Warrants) Walker Mining Co Waltham Watch Co. (“A” Com.) Waltham Watch Co. (“B” Com.) Waltham Watch Co. (Pfd.) 492 WALL STREET WWK P Pr WAL Pr WAL DB R WAM WRL WRL Pr WWR WGL WAS WAK WAY WPY WGJ WGJ Pr WDN WCL WSX WST A WST A COD WCP WCF Pr WGE WMIPr WMS WP Pr WG Pr WTB V WET WJS WMR WMRCOD WPT WTU Pr WVP WWT WL PL WHX WHX Pr A Waltham Watch Co. (Prior Pfd.) Walworth Co. (6% Pfd.) Walworth Co. (Debenture Rights) Wamsutta Mills Warchel Corporation (Com.) Warchel Corporation (Conv. Pref.) Warner Company (Com.) Washington Gas Light Co Washington Oil Co Waukesha Motor Co Wayagamack Pulp & Paper Co., Ltd. (Com.) Wayne Pump Co. (The) (Com.) Welch Grape Juice Co. (Com.) Welch Grape Juice Co. (Pfd.) Wenden Copper Mining Co West Coast Life Insurance Co Western Air Express Corp (Com.) Western Auto Supply Co. (“A” Com.) Western Auto Supply Co. (COD for “A” Com.) Western Canada Flour Mills Co., Ltd. (Com.) Western Canada Flour Mills Co., Ltd. (6*4% Pfd.) Western Grocer Co. (Com.) Western Maryland Rwy. Co. (7% 1st Pfd.) . Western Massachusetts Co.’s (Com.) Western Power Corp. (Pfd.) Western States Gas & Elec. Co. (Pfd.) .... Western Tablet & Stationary Corp. (VTC Com.) Westfield Manufacturing Co. (Com.) West Jersey & SeaShore Rwy. Co Westmoreland Coal Co Westmoreland Coal Co. (COD.) West Point Mfg. Co West Texas Utilities Co. ($6 Pfd.) West Virginia Pulp & Paper Co. (Com.) .... Wheatsworth, Inc. (Com.) Wheeling & Lake Erie Rwy. Co. (The) (7% Prior Lien) Wheeling Steel Corp. (Com.) Wheeling Steel Corp (8% Conv. Pfd. “A”) . . 493 WALL STREET WHX Pr B WSW DB R WSL Pr WSF WTMPr WLD WJ WBU WBU Pr WHT WLM WLL WLL Pr WIS Pr WLJ WEC WEN CV Pr WEN WSG WOL WOV WO WEUA WEL V WOS WOE A WET Y YS YSPPr YNY YO YO Pr YK ZOT ZOTR Wheeling Steel Corp. (10% Conv. Pfd. “B”) . White Sewing Machine Corp. (Deben. Rights) White Star Line, Ltd. (Amer. Dep. Rec. 6 1 / 2 % Pref. Reg.) White Star Refining Co. (Com.) Whitman (Wm.) Co., Inc. (7% Pfd.) Widlar Food Products Co. (Com.) Wieboldt Stores, Inc. (Com.)' Will & Baumer Candle Co., Inc. (Com.) Will & Baumer Candle Co., Inc, (Pfd.) .... Williams Oil-O-Matic Heating Corp. (Com.) . Williams (R. C.) & Co., Inc Wil-low Cafeterias, Inc. (Com.) Wil-low Cafeterias, Inc. (Conv. Pref.) Wisconsin Power & Light Co. (7% Pfd.) . . . Wilson-Jones Co. (Com.) Winnipeg Electric Co., Ltd. (Com.) Winton Engine Co. (The) (Conv. Pref.) .... AY inton Engine Co. (The) (Com.) Witherow Steel Corp. (Com.) AYolverine Portland Cement Co. (Com.) . . . Wolverine Tube Co. (Com.) Woodley Petroleum Co. (Com.) AVoodruff & Edwards, Inc. (Dela.) (Part. “A”) Worcester Electric Light Co. (YTC) Worcester Salt Co Worth, Inc. (Conv. “A”) Wright Hargreaves Mines, Ltd Y “Y” Oil & Gas Co. (Com.) Yates Amer. Machine Co. (Com.) Yates Amer. Machine Co. (Part. Pref.) .... Yellow Taxi Corp., N. Y Young (J. S.) Co. (Com.) Young (J. S.) Co. (7% Pfd.) Yukon Gold Co Z Zonite Products Corp. (Com.) Zonite Products Corp. (Rights) 494 WALL STREET ABB AMB Bonds A Abbott’s Dairies, Inc. 6% M-S 1942 Agricultural Mtge. Bank (Rep. of Col.) 7% ALP ALP AP J-J 15, 1947, 7% A-0 1946 Alabama Power Co. 5% M-N 1956 Alabama Power Co. 4*4% J-D 1967 Allied Packers, Inc. 6 % J-J 1939, 8 % J-J 1939 AA ALI AAG A WW Aluminum Co. of America 5% M-S 1952 .... Aluminum, Ltd. 5 % J-J 1948 American Aggregates Corp. 6 % “A” F-A 1943 (with Wts.) ACX American Commonwealth Power Corp. 6 % M-N 1949 AGO APY ADT ARL ASG ASV WW American Gas & Electric Co. 5 % M-N 2028. . American Power & Light Co. 6% M-S 2016. . American Radiator Co. 4^2% M-N 1947 American Rolling Mill Co. 5% J-J 1948 .... American Seating Co. 6 % J-J 1936 American Solvents & Chemical Corp. 6 1 / 4% M-S 15 1936 (with Wts.) ASV XW American Solvents & Chemical Corp. 6^% M-S 15 1936 (without Wts.) ANT WW Andian National Corp., Ltd. 6% M-S 1940 (with Wts.) ANT XW Andian National Corp., Ltd. 6 % M-S 1940 (without Wts.) AEW Appalachian Electric Power Co. 5 % M-N 1956 AKP ACK ALD ADY WW Arkansas Power & Light Co. 5% A-0 1956. . Armstrong Cork Co. 7% J-J 1931 Arnold Print Works 6 % F-A 1941 Associated Dyeing & Printing Corp. 6% M-N 1938 (with Wts.) AGA WW Associated Gas & Elec. Co. 4%% M-S 1948 (with Wts.) AGA XW Associated Gas & Elec. Co. 4!/2% M-S 1948 (without Wts.) 495 WALL STREET A6A ASH Associated Gas & Electric Co. 5%% F-A 1977 Associated Simmons Hardware Co.’s 6%% J-J 1933 AOTC Associated Telephone Utilities Co. 5 %% “C” M-N, 1944 AFU 1 7% AFU 7% Atlantic Fruit & Sugar Co. 7% “A” J-J 1949 Atlantic Fruit & Sugar Co. 7% Income J-J 1949 AFU 8% Atlantic Fruit & Sugar Co. 8% Income Bonds 1949 AWO Atlas Plywood Corp. 5%% M-N 1943 B BEE Bank of East Prussian Landowners Assn. 6 % A-0 1930 (Parti. Ctfs.) BSV WW Bates Valve Bag Corp. 6 % F-A 1942 (with Wts.) BEO BPC BLG BTC A Beacon Oil Co. 6% M-N 1936 (with Wts.) . . Beaver Products Co., Inc. 7 1 /2% J-J 1942 . . . Belgo-Canadian Paper Co., Ltd. 6% J-J 1943 Bell Telephone Co. of Canada 5 % “A” M-S 1955 BTC B Bell Telephone Co. of Canada 5 % “B” J-D 1957 BMRM BCG BU A BGE A Boston & Maine R. R. 6% “M” J-J 1933 Boston Consolidated Gas Co. 5% F-A 1947. . Brooklyn Borough Gas Co. 5 % “A” F-A 1967 Buffalo General Electric Co. 5% “A” F-A 1956 BRW Burmeister & Wain, Ltd. of Copenhagen 6% J-J 1940 CCT A C Canada Cement Co., Ltd., 5%% “A” M-N 1947 CLRE Canadian Northern Rwy. Co. 7 % “E” M-N 1935 CTA A WW Capital Administration Co. 5% “A” J-D 1953 (with Wts.) CTA A XW Capital Administration Co.,' Ltd., 5 % “A” J-D 1953 (without Wts.) 496 WALL STREET CGV A WW Carolina-Georgia Service Co. 6% “ A ” J-D 1942 (with Wts.) CPO CTL A WW Carolina Power & Light Co. 5 % A-0 1956. . Central Atlantic States Service Corp. 6% “A” M-S 1943 (with Wts.) CTL WW Central Atlantic States Service Corp. 6%% M-S 1933 (with Wts.) CNK A Central Bank of German State & Prov. ONE B Banks, Inc. 6% “A” F-A 1952 Central Bank of German State & Prov. GO C Banks, Inc. 6% “B” A-0 1951 Central of Georgia Rwy. Co. 5 % “C” A-O, 1959 CSE CSE WW Central States Elec. Corp. 5% J-J 1948 .... Central States Elec. Corp. 5^% M-S 15, 1954 (with Wts.) CUT Central States Power & Light Corp. 5^2% J-J 1953 CFT ST Chicago Artificial Ice Co. 6% M-N 1938 .... Chicago, Mil. & St. Paul Rwy. 4% J-D 1925 (Franc) NW Chicago & Northwestern Rwy. Co. 4%% “A” M-N 1949 “WI” CGG CHR COD CDI CLE A Chicago Pneumatic Tool Co. 5 *4% A-0 1942 Chicago Railway Co. COD. for 5% 1927 . . . Childs Co. 5% A-0 1943 Chilean Cons. Municipal Loan 7% “A” M-S 1960 CIG A Cigar Stores Realty Holdings, Inc. (5*4% “A” J-J 1949) CCE A Cincinnati Street Rwy. 5 x /% “A” M-S 1958 Isarco Hydro-Electric Co. 7% M-N 1952 .... Isotta Fraschini 7% J-D 1942 (with Wts.) . . Isotta Fraschini 7% J-D 1942 (without Wts.) Italian Superpower Corp. 6% “A” J-J 1963 (with Wts.) ITS Italian Superpower Corp. (Dela.) 6 % J-J 1963 JE J Jeddo-Highland Coal Co. 6% M-N 1941 .... KEP A KGE A KDS K Kansas Electric Power Co. 6% “A” J-D 1931 Kansas Gas & Electric Co. 6% “A” M-S 2022 Kaufmann Dept. Stores Securities Corp. KLV XW KMO KPS 514% F-A 1936 Kelvinator Corp. 6 % J-J 1936 (without Wts.) Kemsley, Millbourn & Co., Ltd., 6% M-S 1942 Keystone Public Service Co. (5% M-N 1978) 503 WALL STREET KTY A Keystone Telephone Co. of Phila. 5V2% “A” J-D 1955 KWWB Keystone Water Works & Elec. Corp. 5%% “B” M-N 1948 SIMA KONB KRO Kimberly-Clark Corp. 5% “A” J-J 1943 .... Kingdom of Netherlands 6% “B” M-S 1972 Kingdom of Roumania Monopolies Institute KOP 7% F-A 1959 Koppers Gas & Coke Co. 5% J-D 1947 LGL LP A L Laclede Gas Light Co. 5 %% F-A 1935 Lehigh Power Securities Corp. 6% “A” F-A 2026 LTZWW Leonhard Tietz, Inc., 7Y2% J-J 1946 (with Wts.) LTZXW Leonhard Tietz, Inc., 7%% J-J- 1946 (with- out Wts.) LEX WW Lexington Telephone Co. 6% M-S 1944 (with Wts.) LJ LWL Libby, McNeill & Libby 5% A-0 1942 Liggett- Winchester-Ley Realty Corp. 7% M-S 1942 LSG LLT LNG Lone Star Gas Corp. 5% M-N 1942 Long Island Lighting Co. 6% J-J 1945 .... Los Angeles Gas & Elec. Corp. 7% J-D 1930, 5% M-S 1961 LOL LES Louisiana Power & Light Co. 5% J-D 1957 . . Lukens Steel Co. 8% M-N 1940 MPC A M Manitoba Power Co., Ltd., 5^% “A” J-J 1951 MNYWW Mansfeld Mng. & Smelt. Co. 7% M-N 1941 MNYXW (with Wts.) Mansfeld Mng. & Smelt. Co. 7% M-N 1941 MSXJ MSE MHY (without Wts.) Massachusetts Gas Co.’s 5Y2% J-J 194:6 .... Massey-Harris Co., Ltd., 5% A-0 15, 1947 . . McCallum Hosiery Co. 6%% A-0 1941 .... 504 WALL STREET MTU WW McCord Radiator & Mfg. Co. 6% F-A 1943 (with Wts.) MEL Melbourne Elec. Supply Co., Ltd., 7V2% J-D 1946 MPG Memphis Natural Gas Co. 6% F-A 1943 (with stock purchase privilege) MTTD MEX Metropolitan Edison Co. 4*4% “D” M-S 1968 Mexican Government : MY City of Mexico 5 % Sterling Loan of 1889 (J-A-J-O) Cons. 3 Silver Bonds of 1886 (J. 30— D. 31) 5% Int. Redeemable Bonds of 1894 (M-S) (Perpetual) Milwaukee Elec. Rwy. & Lt. Co. 7*4% J-D 1941 MGT MSA C Milwaukee Gas Light Co. 4^2% M-S 1967 . . Minnesota & Ontario Paper Co. 6 % “C” M-N 1950 MG MSR WW Minnesota Pw. & Lt. Co. 4*4% M-N 1978 . . . Mississippi River Fuel Corp. (Del.) 6% F-A 15, 1944 (with Wts.) MLP A Montreal Light, Heat & Pw. Cons. 5% “A” A-0 1951 MRS MPO Morris & Co. 7%% M-S 1930 Mtge. Bank of Bogota (Rep. of Col.) 7% M-N 1947 (Issue of May, 1927) MPON Mtge. Bank of Bogota (Rep. of Col.) 7% A-0 1947 (Issue of October, 1927) MOZ MOZ MBD IX Mtge. Bank of Chile 6% J 30— D 31, 1931 . . Mtge. Bank of Chile 6% M-N 1962 Mtge. Bank of the Kingdom of Denmark b% “IX” J-D 1972 MLG A Municipal Gas Co. of the City of Albany MOM 51 / 2 % “A” M-S 2022 Municipality of Medellin (Rep. of Col.) 7% J-D 1951 MUS WW Munson Steamship Line (6%% A-0 1937 with Wts.) NGS A NHN N Narragansett Elec. Co. 5% “A” J-J 1957 . . . Nathan Strauss, Inc. 6% M-N 1938 505 WALL STREET NDP National Distillers Products Corp. 6 1 / 2 % J-D 15, 1935 NFU A National Food Products Corp. 6 % “A” M-N, 1944 NPL A National Power & Light Co. 6 % “A” F-A 2026 NPU NRU NLL NTJ NBE A NEI NEE National Public Service Corp. 5% F-A 1978 National Rubber Machinery Co. 6% J-J 1943 National Toll Bridge Co. 6% J-J 1939 National Trade Journal, Inc. (6% M-N 1938) Nebraska Power Co. 6% “ A ” M-S 2022 .... Neisner Bros. Realty, Inc. ( 6 % J-D 15, 1948) New England Gas & Elec. Asso. 5% M-S NOY SLC 1947, 5 % J-D 1948 New Jersey Power & Light Co. 5% F-A 1956 New York, Chicago & St. Louis R. R. Co. 6 % “C” M-N 1931 NYF A WW New York & Foreign Investing Corp. ( 5 ^ 2 % “A” J-D 1948 with Wts.) NHF-P N. Y., N. H. & H. R. R. Co. Ext. 7% A-0 1925 (Paris Depositary) NYP New York Power & Light Corp. 4%% A-0 1967 NF NIP NAW A Niagara Falls Power Co. 6% M-N 1950 Nippon Electric Pw. Co., Ltd., 6 !/ 2 % J-J 1953 North American Water Works & Elec. Corp. NIC ( 6 % “A” M-N 1938) Northern Indiana Public Service Co. 5% “C” M-N 1966 NPW Northern States Power Co. (Minn.) 6 y^fo M-N 1933 NXU WW Northern Texas Utilities Co. 7% J-J 1935 with Wts.) NQ Nova Scotia Steel & Coal Co., Ltd., 6% Per- petual Deb. Stock dated July 1, 1909 (J-J) OHP 0 Ohio Power Co. 4y 2 % “D” J-D 1956, 5% “B” J-J 1952 ORE OSG WW Ohio River Edison Co. 5% J-D 1951 Osgood Co. (The) 6 % J-D 1938 (with Wts.) 506 WALL STREET oso osw OTW A PCGE PIV WW PPU PWL WW PME PTI POE XW POE B PDK WW PGL PPL PWT A PLW PEL PEW PV PSC P WW PXW PIKA PW A PWB Oswego Falls Corp. 6 % J-J 1941 Oswego River Power Corp. 6% J-D 1931 .... Ottawa Lt., Ht. & Pw. Co., Ltd., 5 % “A” A-0 1957 P Pacific Gas & Elec. Co. 4%% “E” J-D 1957 Pacific Investing Corp. 5 % “A” J-J 1948 (with Wts.) Pacific Public Service Co. 6% M-S 1944 . . . Pacific Western Oil Co. (6^% M-N 1943 with Wts.) Parmalee Transportation Co. 6% A-0 1944. . Park & Tilford, Inc., 6% J-D 1936 Penn-Ohio Edison Co. 6 % “A” M-N 1950 (without Wts.) Penn-Ohio Edison Co. (5%% “B” F-A 1959) Pennsylvania Dock & Warehouse Co. 6% F-A 1949 (with Wts.) Pennsylvania Glass Sand Corp. 6% J-J 1952 Pennsylvania Power & Light Co. 5 % “B” A-0 1952, 5 % “D” M-S 1953 Pennsylvania Water Service Co. 5% “A” F-A 1967 Peoples Light & Power Corp. 5% J-J 1979 Philadelphia Electric Co. 5 a /2% M-N 1953, 6% J-D 1941, 51 / 2 % J-D 1947, 5% J-J 1960 Philadelphia Electric Pw. Co. 5%% F-A 1972 Philadelphia Rapid Transit Co. 6 % M-S 1962 Philadelphia Suburban Counties Gas & Elec. Co. 41 / 2 % N-M 1957, 41 / 2 % M-N 1957 (Ad- ditional Issue) Phillips Petroleum Co. 7%% A-0 1931 (with Wts.) Phillips Petroleum Co. 7^% A-0 1931 (with- out Wts.) Pickering Lumber Co. 6 % “A” M-N 1946 . . Pittsburgh & West Virginia Rwy. Co. (4 “A” J-D 1958) Pittsburgh & West Virginia Rwy. Co. (4 1 />% “B” A-0 1959 507 WALL STREET PC PSW Pittsburgh Coal Co. 6% F-A 1949 Pittsburgh Screw & Bolt Corp. 5^% J-D 1947 PG POR HVK PTOE POU XW Pittsburgh Steel Co. 6% F-A 1948 Poor & Company 6% A-0 15, 1939 Port of Havana Dock Co. 7% J-J 1937 Potomac Edison Co. (The) 5 % “E” M-N 1956 Potrero Sugar Co. 7% M-N 15, 1947 (with- out Wts.) PWX PSL PGM PBU Power Corp. of N. Y. 5%% M-N 1947 Pressed Steel Car Co. (5% J-J 1943) Procter & Gamble Co. 4^% J-J 1947 Province of Buenos Aires (Argen. Rep.) 7% POH PVZ J-J 1936, 71 / 2 % M-N 1947, 7% A-0 1952 . . Province of Hanover 6^% F-A 1949 Province of Mendoza (Argen. Rep.) 7%% J-D 1951 PUB PSI PUW A Public Service Corp. of N. J. 7% J-D 1941. . Public Service Co. of No. 111. 5% M-S 1931. . Puget Sound Pw. & Lt. Co. 5 *4% “A” J-D 1949 PQS Punta Alegre Sugar Co. 6% A-0 1930 QSA Q Queens Borough Gas & Elec. Co. 5 x /%°/o “A” A-0 1952 QS Queens Borough Gas & Elec. Co. 4*4% M-S 1958 RBZ RMG R Reliance Bronze & Steel Corp. 6% A-0 1944 Reliance Management Corporation 5% “A” F-A 1954 (with Allot. Wts. & Stk. Pur. Wts.) REM RIL RCP A Remington Arms Co., Inc. 5 *4% M-S 1930. . Richfield Oil Co. of Calif. 5%% J-D 1931 . . . Rochester Central Power Corp. 5% “A” M-S 1953 RUB Ruberoid Co. 8% 1936 50 8 WALL STREET EUHA RUS Ruhr Gas Corp. ey 2 % “A” A-0 1953 Russian Gov’t 5%% J-D 1921, 6 y 2 % J-J 1919 and Nat. City Bank COD for both RYE Ryerson (Joseph T.) & Son, Inc., 5% M-N 1943 SBN SGE SNOB S Saar Basin Cons. Counties 7 % A-0 1935 .... St. Louis Gas & Coke Corp. 6% J-D 1947 . . . San Antonio Public Service Co. 5% “B” J-J 1958 SJLB San Joaquin Lt. & Pw. Corp. 6% “B” M-S 1952 SAU A SRE Sauda Falls Co., Ltd., 5% “A” A-0 1955 . . . Schulte Real Estate Co., Inc., 6% J-D 1935 (with Com. Stock) SREX Schulte Real Estate Co., Inc., 6% J-D 1935 (without Com. Stock) SCR SVD SWW A Scripps (The E. W.) Co. 5 y 2 % F-A 1943 . . . Servel, Inc. (New Co.) 5% J-J 1948 Shawinigan Water & Power Co. 4 y 2 % “A” A-0 1967 SAM SSL SUX WW Shawsheen Mills 7% A-0 1931 Sheffield Steel Corp. 5%% M-S 1948 Shell Union Oil Corp. 5% A-0 1949 (with Wts.) SRY Sheridan-Wyoming Coal Co., Inc., 6% J-J 1947 SIG WW Silica Gel. Corp. (The) 6*4% A-0 1932 (with Wts.) SIM WW SPK SNR SO A Simmons Co. 5% 1944 (with Wts.) “WI” 610 Park Avenue Bldg. 6% J-J 1940 Snider Packing Corp. 6% M-N 1932 Solvay American Investment Corp. 5% “A” M-S 1942 SOW SGA South Carolina Power Co. 5% J-J 1957 .... Southern Natural Gas Corp. 6% J-J 1944 with Privilege) SEP XW Southeastern Pw. & Lt. Co. 6% M-S 2025 (without Wts.) 509 WALL STREET SCE SUG sue SD SOD WW SOGWW SUP A SGT A SWU A SWL A SLY STD WW STV SWD STF A SOF SMB SOP SRJ SWC SUZ SUM SUN SWX SWS TAC Southern California Edison Co. 5 % F-A 1944, 5% J-J 1951, 5% M-S 1952 Southern California Gas. Co. 5% M-S 1957 . . Southern California Gas Corp. 5% M-N 1937 Southern Dairies, Inc., 6% M-N 1930 Southwest Dairy Products Co. (6%% M-N 1938 with Wts.) Southern Gas Co. 6%% M-N 1935 (with Wts.) Southern Public Service Co. 6% “A” F-A 1943 Southwestern Gas & Elec. Co. 5 % “A” J-J 1957 Southwestern Lt. & Pw. Co. 5% “A” F-A 1957 Southwestern Pw. & Lt. Co. 6% “A” M-S 2022 Staley (A. E.’)’ Mfg.' Co’. 6 % M-S 1942 ’. ’. ’. ’. ’. '. Standard Investing Corp. 5 % M-S 1937 (with Wts.) Standard Investing Corp. 5%% F-A 15, 1939 Standard Power & Light Corp. 6% F-A 1957 Standard Telephone Co. (5 %% “A” M-N 1943) State of Maranhao (Brazil) 7% M-N 1958. . State Mtge. Bank of Jugoslavia 7% A-0 1957 State of Parama (U. S. of Brazil) 7% M-S 15, 1958 State of Rio de Janeiro J-J 1959 ..... Strawbridge & Clothier 6% M-S 1942, 5% M-S 1948 Stutz Motor Car Co. of Amer. 7%% A-0 1937 Sun-Maid Raisin Growers Assn. 6%% F-A 1942 Sun Oil Co. 51 / 2 % M-S 1939 Swift & Co. 5 % A-0 15, 1932 Swiss Confederation 5^% F-A 1929 T Temple Anthracite Coal Co. 6%% M-S 15, 1944 510 WALL STREET TEG TXP THR TLX TRU TUY Texas Cities Gas Co. 5% M-N 1948 Texas Power & Light Co. 5% M-N 1956 . . . Thermoid Co. 6 % F-A 1934 (with Wts.) . . . Trans-Lux Daylight Picture Screen Corp 6 Y 2 % M-N 16, 1932 (with Wts. and with- out Wts.) Tri-Utilities Corp. 5% M-S 1979 Troy Laundry Machinery Co., Ltd., 8% J-J 1936 ULE UAI A WW UGS A WW UGS A XW USY A WW USY A XW UIC ULR A ULR UNO UPR A WW UHV • UNS A RU USWA WW UPW UL WW UTL A U Ulen & Company 6 % F-A 1944 Union American Investing Corp. ( 5 % “A” J-D 1948 with Wts Union Gas Utilities, Inc., 6 ^ 2 % “A” M-N 1937 (with Wts.) Union Gas Utilities, Inc. 6 y>% “A” M-N 1937 (without Wts.) United Elec. Service Co. 7% “A” J-D 1956 (with Wts.) United Elec. Service Co. 7% “A” J-D 1956 without Wts.) United Industrial Corp. 6 ^ 2 % M-N 1941. . . . United Light & Rwys. Co. 6 % “A” A-0 1952 United Light & Rwys. Co. 5^% F-A 1952. . United Oil Producers Corp. 8 % J-J 25, 1931 United Porto Rican Sugar Co. 6 ^% “A” M-S 1937 (with Wts.) United Rwys. of Havana 7V6% F-A 15, 1936 United States Radiator Corp. 5 % “A” F-A 1938 United States Rubber Co. 6 V 2 % M-S 1930 to 1940 inclusive United Steel Works Corp. 6 %% “A” J-J 1947 (with Wts.) Utah Pw. & Lt. Co. 4y 2 % F-A 1944 Utilities Power & Light Corp. 5% F-A 1959 (with Wts.) Utilities Service Co. (The) 6 %% “A” F-A 1938 511 WALL STREET VA VI VEP A WMK WBP WZ WBM WCO WVA WNU WP A WGA WTX A WTT WKN WO WISE in v Valvoline Oil Co. 7% M-N 1937 Van Camp Packing Co., Inc., 6 % A-0 1948 Virginia Elec. & Power Co. 5% “A” A 1955 (Additional) W Wanamaker (John) Phila. 5^2% A-0 1949. . Warner Bros. Pictures, Inc. 6% M-S 1939 . . Wayne Coal Co. 6% M-S 1937 Webster Mills 6i/ 2 % J-D 1933 Westvaco Clorine Products Corp. 5^2% M-S 1937 West Virginia (States) 3%% J-J 1936 Western Newspaper Union 6% F-A 1944 . . . Western Power Corp. “A” J-D 1954, 51 / 2 % “A” J-J 1957 Western States Gas & Elec. Co. of Cal. 6% “A” M-S 1947 West Texas Utilities Co. 5 % “A” A-0 1957 Whittall (M. J.) Associates, Ltd., 5% J-D 1937 Wickwire-Spencer Steel Corp. 7%% M-S 1932 Wisconsin Central Railway Co. 5 % J-J 1930 Wisconsin Power & Light Co. 5 % “E” M-N 1956 Y York Ice Machinery Corp. 6 % A-0 1947, 6 % J-D 1937 512 J. F. C Date Due /VprV'^ WAR 14 m J Decl3’3i*KU %J4' 34 8 Ma^l 1’3€ nr Junl’36 T d9g,S A0 I I CEB 2 ’40 J&Tj-isj -- JANJg’$|i 1 4 T 2 6 '42 SMEC3 1'4» Library Bureau Cat. no. 1137 D00498765$ 332.64 .H688W 209044