NISM Certifications · NISM-Series-VI: Depository Operations · Introduction to the Indian Capital Market
Karan asks a DP what advantage holding securities in dematerialised form offers over physical certificates. Which is a genuine advantage?
Dematerialisation removes the risks of forgery, loss, theft and delay associated with physical share certificates and speeds up transfers. It does not guarantee gains, protect against price changes, or make transfers free of charges.
- AElimination of risks such as forgery, loss and theft of certificatesCorrect
- BGuaranteed capital appreciation on holdings
- CExemption from all charges on transfers
- DImmunity from market price fluctuations
Explanation
Demat removes risks tied to physical certificates, such as loss, theft, forgery and delays in transfer. It does not guarantee returns, remove price risk, or make transactions free of charges.
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