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

Mr. Iyer bought 200 shares of an Indian company through his broker on the exchange on Monday. By when must the broker ordinarily issue the contract note to him, under the usual rule for contract notes?

The broker must issue the contract note within 24 hours of executing the trade. This ensures the client receives timely written confirmation of the trade details, including price, quantity and charges. Waiting until month end, seven days, or a client request would not meet the requirement.

  1. AWithin 24 hours of the execution of the tradesCorrect
  2. BWithin 7 days of the settlement
  3. CAt the end of the month
  4. DOnly when the client asks for it

Explanation

Brokers are required to issue contract notes to clients within 24 hours of the execution of trades. It is not left until month end or until the client asks. The 7-day option does not match the rule, so it is wrong.

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