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NISM Certifications · NISM-Series-VI: Depository Operations · Functions of Depository Participant - Account Operations

A BO wants to move 500 shares from his demat account with a DP to another BO's account at the same depository, outside any stock exchange trade. Which type of instruction does he need to give to his DP?

The BO must give an off-market delivery instruction. A transfer between demat accounts that is not connected with settlement of an exchange trade is off-market, and it is executed on the BO's signed delivery instruction slip submitted to the DP.

  1. AOff-market delivery instructionCorrect
  2. BOn-market delivery instruction
  3. CRematerialisation request
  4. DPledge creation request

Explanation

A transfer that is not linked to a settlement of a stock exchange trade is an off-market transfer. It is executed by the BO giving a delivery instruction slip (DIS) to the DP. On-market transfers relate to exchange trades settled through clearing corporation pay-in. Rematerialisation and pledge serve different purposes.

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