What it is:
How it works (Example):
Blue sheets are requests from the SEC that are sent out to investment companies which have executed a trade that considerably affected the price of a security. A blue sheet asks for information like the name of the investment house, the name of the security traded and the specific parties involved in the trade.
The blue sheet system has been digitized through an electronic blue sheet system.
Why it Matters:
The SEC uses blue sheets to track trading that it suspects may involve fraudulent or unlawful activity that might disadvantage other investors.