NISM Certifications · NISM-Series-VI: Depository Operations · Special Services - Debt Instruments and Government Securities
A client with a demat account wants to buy Government securities on the stock exchange in small lots. Which statement about such trading is correct in the Indian context?
G-secs can be held in a demat account and traded on recognised stock exchanges, including in small lot sizes suited to retail investors, with settlement through the clearing corporation and the depository. Physical-only trading or a bank-only restriction does not apply.
- AG-secs can be traded in demat form on recognised stock exchanges, including in small denominations, and settle through the depositoryCorrect
- BG-secs cannot be held in a demat account at all
- CG-secs can be traded only in physical certificate form
- DOnly banks can ever buy G-secs
Explanation
Government securities can be held in demat accounts and traded on exchanges in small lots, with settlement through the clearing corporation and depository. The other options are incorrect because retail access and demat holding are permitted.
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