A:

The International Securities Identification Numbering (ISIN) system is an international standard set up by the International Organization for Standardization (ISO). It is used for numbering specific securities, such as stock, bonds, options and futures. ISIN numbers are administered by a National Numbering Agency (NNA) in each of their respective countries, and they work just like serial numbers for those securities.

An ISIN code has 12 characters in total, which are alphanumeric, and is structured to include the country in which the issuing company is headquartered, the specific security identification number and a final character acting as a check. The first two digits are reserved for the country of origin for the security (the head office of the issuing company). The second grouping, which is nine characters long, is reserved for the actual unique identifying number for the security. The final digit, which is called a check digit, ensures the code's authenticity and prevents errors.

The middle nine digits of the ISIN system number is administered by the appropriate NNA, which is called the CUSIP Service Bureau in the United States. This office was created to improve the numbering system for securities by making a country-wide standard for the financial industry. The CUSIP Service Bureau was first established in 1964, and it continues to enforce its numbering system by way of a board of trustees.

The ISIN formula, which is complex, is currently computed by computers and helps to protect against counterfeiting and forgery. For example, assume that a company from the U.S. issues a stock certificate for its stock. The ISIN number could look like this: US-000402625-0 (dashes added for simplicity). The country code, "US", is at the beginning, followed by the nine-digit CUSIP number for the specific security itself, with the last digit acting as the check digit.

To learn more about how an ISIN number could benefit you, read Old Stock Certificates: Lost Treasure Or Wallpaper?

RELATED FAQS
  1. Do hedge funds have ISIN numbers?

    Learn about ISINs, why hedge funds have them, and how ISINs are used to identify and track securities on exchanges around ... Read Answer >>
  2. What is a CUSIP number?

    CUSIP stands for Committee on Uniform Securities Identification Procedures. Formed in 1962, this committee developed a system ... Read Answer >>
  3. Do mutual funds have CUSIP numbers?

    Learn what CUSIP numbers are and how they are used to classify securities, such as mutual funds, registered in the U.S. and ... Read Answer >>
  4. How do I find the CUSIP number for a particular stock?

    Unfortunately, this can be a little difficult as CUSIP numbers are owned and created by the American Bankers Association ... Read Answer >>
  5. Do hedge funds have CUSIP numbers?

    Learn what a CUSIP number is, and whether this number is necessary for hedge funds, ETFs and various other types of investment ... Read Answer >>
  6. How do you get a hard copy of a stock certificate?

    Before online brokers and personally-directed accounts, holding a physical stock certificate was a necessity, as this was ... Read Answer >>
Related Articles
  1. Investing

    Old Stock Certificates: Lost Treasure Or Wallpaper?

    What if you've discovered some old shares in bearer form? Follow our tips and find out what they're worth.
  2. Personal Finance

    Bank Lingo: Routing Number Vs. Account Number

    Each consumer bank account has its own personal ID. And so does the bank. How do these numbers function and how do they protect the account holder?
  3. Investing

    Old Stock Certificates: Lost Treasure?

    Today, most stocks reside electronically in a broker’s computer. But it is possible to stumble across a physical stock certificate.
  4. Financial Advisor

    Estate Planning Goes Digital: How to Get Started

    Digital estate planning is an important part of the estate planning process given today's tech-centric world. Here's how to create this type of plan.
  5. Retirement

    The Purpose Of Having A Social Security Number

    When (and why) it is necessary to use the nine-digit number the United States government issues to individuals and when you should avoid it.
  6. Financial Advisor

    How Wealth Managers Can Bridge Digital Tech Gap

    A lack of digital technology offerings puts many wealth management firms at risk of losing significant income due to client attrition.
  7. Professionals

    Do's & Don'ts Of Digital Marketing

    Digital marketing is not as scary or as complex as it is often made out to be, but there are certain best practices that you should follow to make it work.
  8. Investing

    Inside National Payment Systems

    Investopedia explains: The global interconnection of U.S. payment systems makes commerical and financial transfers possible.
  9. Trading

    The BoE's Brave New World of Cryptocurrencies

    The Bank of England advocates for the virtues of blockchain-based digital currency technology, which would be a seismic shift in the world of currencies
  10. Trading

    Use Round Numbers To Work The Market To Your Favor

    Trading around round numbers like 10, 50 and 100 display unique market dynamics that translate into profitable trading opportunities.
RELATED TERMS
  1. International Securities Identification Number - ISIN

    A code that uniquely identifies a specific securities issue. ...
  2. CUSIP Number

    An identification number assigned to all stocks and registered ...
  3. Dummy CUSIP Number

    A temporary identification number attached to a security by a ...
  4. CINS Number

    An extension to the CUSIP numbering system, which is used to ...
  5. Valoren Number

    An identification number assigned to financial instruments in ...
  6. Employer Identification Number - EIN

    A unique identification number that is assigned to a business ...
Hot Definitions
  1. Duration

    A measure of the sensitivity of the price (the value of principal) of a fixed-income investment to a change in interest rates. ...
  2. Dove

    An economic policy advisor who promotes monetary policies that involve the maintenance of low interest rates, believing that ...
  3. Cyclical Stock

    An equity security whose price is affected by ups and downs in the overall economy. Cyclical stocks typically relate to companies ...
  4. Front Running

    The unethical practice of a broker trading an equity based on information from the analyst department before his or her clients ...
  5. After-Hours Trading - AHT

    Trading after regular trading hours on the major exchanges. The increasing popularity of electronic communication networks ...
  6. Omnibus Account

    An account between two futures merchants (brokers). It involves the transaction of individual accounts which are combined ...
Trading Center