NISM Certifications · NISM-Series-VII: Securities Operations and Risk Management · Clearing Process
A trading member has 4 clients. Client A's net buy obligation is Rs 8 lakh, client B's net sell obligation is Rs 3 lakh, client C's net buy is Rs 2 lakh and client D's net sell is Rs 5 lakh, all in different securities. At the clearing member level, what is the member's net funds obligation for the day, ignoring charges?
The member has a net funds pay-in of Rs 2 lakh. Purchases total Rs 10 lakh payable and sales total Rs 8 lakh receivable, so after netting the funds across clients at member level, Rs 2 lakh is payable to the clearing corporation.
- ANet pay-in of Rs 2 lakhCorrect
- BNet pay-in of Rs 18 lakh
- CNet pay-out of Rs 2 lakh
- DNet pay-out of Rs 8 lakh
Explanation
Total buys = 8 + 2 = Rs 10 lakh (funds payable). Total sells = 3 + 5 = Rs 8 lakh (funds receivable). Net = 10 - 8 = Rs 2 lakh pay-in. Rs 18 lakh adds all values; the pay-out options reverse or misuse the sign.
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