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NISM Certifications · NISM-Series-VI: Depository Operations · Functions of Depository Participant - Trading and Settlement

A client sold shares through a broker on the exchange and wants the shares to leave his demat account for settlement. Which instruction does he normally give to his Depository Participant for an on-market trade?

The client gives the DP a Delivery Instruction Slip for an on-market transfer, directing the shares to the broker's pool account or the clearing corporation's designated account before pay-in. Rematerialisation, pledge or nomination forms do not deliver shares for settlement of a market sale.

  1. ADelivery Instruction Slip (DIS) for an on-market transfer to the broker's pool account or the clearing corporation's designated accountCorrect
  2. BA request for rematerialisation of the shares
  3. CA pledge creation request in favour of the broker
  4. DA nomination change form

Explanation

For on-market sale transactions, the client gives a DIS instructing the DP to transfer the securities to the broker's pool account (or as directed by the clearing corporation) before the pay-in deadline. Rematerialisation, pledge and nomination changes do not settle a sale.

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