Skip to content

NISM Certifications · NISM-Series-VII: Securities Operations and Risk Management · Introduction to Securities Broking Operations

A trading member wants to open an account for a new individual client. Which document is the client required to sign as the core agreement defining the rights and obligations between broker and client?

The member-client agreement is the correct document. It is signed when the account is opened and lays down the rights and obligations of both broker and client. A contract note is only a confirmation of executed trades, and margin statements or guarantees do not govern the relationship.

  1. AMember-client agreementCorrect
  2. BContract note
  3. CBank guarantee
  4. DMargin statement

Explanation

The member-client agreement is the standard document executed at account opening that sets out the rights and obligations of the broker and the client. A contract note is issued after trade execution, not at onboarding. A margin statement and a bank guarantee do not define the overall relationship.

Did you get it right without looking?

One question tells you little. A timed set on Introduction to Securities Broking Operations shows your real accuracy, how long you take and where you lose marks.

Practise Introduction to Securities Broking OperationsFree diagnostic mock

More Introduction to Securities Broking Operations questions