Fictitious Trade

The term "fictitious trades" describes financial transactions that aren't real. Made up. Fictions.

In many cases, fictitious trades are part of illegal schemes to manipulate the market or steal money. These scams could include fake trades that alter the price for a stock, or transactions that only exist on corporate paperwork as a way to disguise embezzlement, or some other grift.

However, there are a handful of situations where a fictitious trade can be used as a legitimate business practice. These cases mostly involve the trades as placeholders, with execution dates or other details to be filled in down the road. When first sketched out, the trades are fictitious, but the goal is to make them real when the time comes.