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NISM Certifications · NISM-Series-VII: Securities Operations and Risk Management · Introduction to Securities Broking Operations

A broker executes several trades for a client on one trading day. By when must the broker ordinarily issue the contract note to the client, under the exchange and SEBI rules applicable to trade confirmation?

A broker must issue the contract note to the client within 24 hours of executing the trades. The document is the formal confirmation of the trade, so longer periods like a week are not permitted under exchange and SEBI requirements.

  1. AWithin 24 hours of the execution of the tradesCorrect
  2. BWithin 7 days of the trade date
  3. CBy the end of the settlement week
  4. DAt the time the client next logs in to the back-office portal

Explanation

Contract notes must be issued to clients within 24 hours of the execution of trades. The longer periods such as 7 days or the end of the settlement week are not permitted. Merely making the note visible on a portal login does not satisfy the requirement.

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