Skip to content

NISM Certifications · NISM-Series-VI: Depository Operations · Foreign Portfolio Investors (FPI)

A DP is servicing an FPI client's demat account. Which statement about the FPI's holding in Indian equity is correct under the SEBI FPI framework?

FPIs must hold their securities in dematerialised form only, through a depository account with a DP. Physical holding is not permitted under the FPI Regulations, so the DP maintains the FPI's demat account and records its holdings electronically.

  1. ASecurities of FPIs may be held only in dematerialised formCorrect
  2. BFPIs may hold equity shares only in physical form
  3. CFPIs can hold securities in either form at their option
  4. DFPIs must hold securities only with a stock exchange

Explanation

The FPI Regulations require that FPI investments in securities be held in dematerialised form, with the depository account maintained through a DP. Physical holding is not allowed, and exchanges do not hold securities as custodians for FPIs.

Did you get it right without looking?

One question tells you little. A timed set on Foreign Portfolio Investors (FPI) shows your real accuracy, how long you take and where you lose marks.

Practise Foreign Portfolio Investors (FPI)Free diagnostic mock

More Foreign Portfolio Investors (FPI) questions