Skip to content

NISM Certifications · NISM-Series-VI: Depository Operations · Functions of Depository Participant - Trading and Settlement

Mr. Iyer sold shares through his broker and wants to deliver them from his demat account for pay-in. Which mechanism lets him transfer the shares to the clearing member's pool account?

The client gives a delivery instruction slip or electronic instruction to the DP, which debits the client's demat account and credits the clearing member's pool account for pay-in. Physical certificates, company registers or RBI are not involved in this settlement.

  1. AGiving a delivery instruction slip (DIS) to his DP, or an electronic instruction, to debit his account and credit the clearing member pool accountCorrect
  2. BSending a physical share certificate to the stock exchange
  3. CAsking the company to register the broker as holder in its register
  4. DRequesting the RBI to transfer the shares

Explanation

For on-market sale, the client instructs the DP through a DIS or an electronic instruction to move securities from the client account to the clearing member's pool account before pay-in. The other options are not part of the depository settlement process.

Did you get it right without looking?

One question tells you little. A timed set on Functions of Depository Participant - Trading and Settlement shows your real accuracy, how long you take and where you lose marks.

Practise Functions of Depository Participant - Trading and SettlementFree diagnostic mock

More Functions of Depository Participant - Trading and Settlement questions