NISM Certifications · NISM-Series-VI: Depository Operations · Depository and its Business Partners
Ms. Kavita Rao wants to open a demat account and approaches a Depository Participant of NSDL. Which statement best describes the legal relationship between her and the depository?
The investor's agreement is with the Depository Participant, which acts as the agent of the depository and is the intermediary through which investors access depository services. The investor does not generally sign a direct agreement with the depository itself.
- AShe has a direct contractual agreement with the depository only
- BShe enters an agreement with the DP, which is the agent of the depository, and not directly with the depositoryCorrect
- CShe has an agreement with the Registrar of the issuer
- DShe is bound only by the stock exchange's rules
Explanation
The investor signs an account opening agreement with the DP, which acts as an agent of the depository. The investor does not deal directly with the depository for account services, so the first option is wrong.
Did you get it right without looking?
One question tells you little. A timed set on Depository and its Business Partners shows your real accuracy, how long you take and where you lose marks.
More Depository and its Business Partners questions
- A DP, Sunrise Securities, wishes to know who regulates its day-to-day operations in the depository system and under which framework it funct…
- Ms. Kavita Rao wants to know who the legal owner of her dematerialised shares is in the records of the issuer company. Under the depository …
- Which of the following is a function that a Registrar and Transfer Agent (R&TA) performs as a business partner of a depository, in relation …
- Which entity acts as the link through which an investor in India obtains depository services such as opening a demat account?
- A DP receives a request from a client Mr. Iyer to open a demat account. Which statement correctly describes the DP's responsibility regardin…
- Mr. Sharma's DP, a bank, wants to hold a demat account with the depository in its own name for its proprietary holdings, and also serves cli…