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NISM Certifications · NISM-Series-VII: Securities Operations and Risk Management · Other Services Provided by Brokers

A client wants to transfer shares from the broker's demat account to the client's own demat account after a purchase. Under current rules, how are securities bought by clients generally credited?

Securities bought by a client are credited directly into the client's demat account from the clearing corporation's pay-out, bypassing the broker's pool account. This reduces misuse risk, and no waiting period or physical slip is required.

  1. ADirectly to the client's demat account from the clearing corporation pay-out, not through the broker's pool accountCorrect
  2. BFirst to the broker's pool account for at least 30 days
  3. CTo the broker's proprietary account for safekeeping
  4. DOnly after the client submits a physical delivery instruction slip

Explanation

Pay-out of securities is credited by the clearing corporation directly to the client's demat account, which prevents misuse of client securities in a broker's pool account. The other options describe practices that are not required or permitted.

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