Loading the player...
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. 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 >>
  3. 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 >>
  4. Do all countries follow the same GAAP?

    Learn about GAAP and IFRS accounting standards, and understand the difficulties in having a basic set of accounting principles ... 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. Insights

    Inside National Payment Systems

    Investopedia explains: The global interconnection of U.S. payment systems makes commerical and financial transfers possible.
  4. Managing Wealth

    Introduction to Incentive Stock Options

    Find out how incentive stock options (ISOs) work and the ways they can be used.
  5. 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.
  6. Investing

    The Impact Of Combining The U.S. GAAP And IFRS

    The convergence of accounting standards is changing the attitudes of CPAs and CFOs toward harmonization of international accounting.
  7. Investing

    Is Twitter's Character Limit Holding It Back?

    Twitter is relaxing rules on character limits in replies, but some say limits are holding it back.
  8. Tech

    More Governments Test Out Cryptocurrencies

    Digital currencies may be enticing to governments if cash is in decline or financial networks are out of date.
RELATED TERMS
  1. CUSIP Number

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

    A temporary identification number attached to a security by a ...
  3. Valoren Number

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

    A unique identification number that is assigned to a business ...
  5. International Organization for Standardization - ISO

    The International Organization for Standardization or ISO is ...
  6. ISO Currency Code

    Three-letter alphabetic codes that represent the various currencies ...
Hot Definitions
  1. IRR Rule

    A measure for evaluating whether to proceed with a project or investment. The IRR rule states that if the internal rate of ...
  2. Short Covering

    Short covering is buying back borrowed securities in order to close an open short position.
  3. Covariance

    A measure of the degree to which returns on two risky assets move in tandem. A positive covariance means that asset returns ...
  4. Liquid Asset

    An asset that can be converted into cash quickly and with minimal impact to the price received. Liquid assets are generally ...
  5. Nostro Account

    A bank account held in a foreign country by a domestic bank, denominated in the currency of that country. Nostro accounts ...
  6. Retirement Planning

    Retirement planning is the process of determining retirement income goals and the actions and decisions necessary to achieve ...
Trading Center