What is a Book-Entry Security?
” Book-entry securities are securities that are recognized as belonging to a particular owner, without the creation of a physical stock certificate. Proof of the ownership for these types of securities is found in the related entries that are found in the official records of the issuer of the stock. The book-entry security has enjoyed a great deal of popularity, since the process allows owners to retain shares of stock without being encumbered by the task of keeping up with paper documents. . Brokerage firms also enjoy the book-entry security process.
Book-entry securities are securities that are recognized as belonging to a particular owner, without the creation of a physical stock certificate. Proof of the ownership for these types of securities is found in the related entries that are found in the official records of the issuer of the stock. The book-entry security has enjoyed a great deal of popularity, since the process allows owners to retain shares of stock without being encumbered by the task of keeping up with paper documents. Brokerage firms also enjoy the book-entry security process. Just as the strategy helps to keep the paperwork to a minimum for the investor, a book-entry security translates into less documentation to be filed and preserved for the broker that is charged with managing the asset. The process that is followed when the shares are sold can illustrate one of the ways in which the record keeping is simplified. Instead of having to invalidate printed copies of the shares and arrange for them to be reissued to
