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NISM Certifications · NISM-Series-VII: Securities Operations and Risk Management · Market Participants in the Securities Market

A person wishes to act as a sub-broker's successor, i.e. an entity who works under a stock broker, bringing clients and routing orders but not dealing directly with the exchange. Under current SEBI framework, what is this person called?

Such a person is called an authorised person. After SEBI discontinued the sub-broker category, entities that source clients and route orders on behalf of a stock broker are approved by the exchange as authorised persons, whereas clearing member types concern settlement.

  1. AAuthorised personCorrect
  2. BClearing member
  3. CSelf-clearing member
  4. DProfessional clearing member

Explanation

Since the sub-broker category was discontinued, such intermediaries are registered as authorised persons with stock exchanges, working under a trading member. The clearing member categories relate to settlement of trades, not client sourcing.

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