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

Ravi sold shares through his broker on the exchange. To settle the sale, which instruction must Ravi's DP act upon so that the shares move out of his demat account to the clearing member's pool account?

The DP must act on a delivery instruction slip signed by the client, or its electronic equivalent. This authorises transfer of the sold shares from the client's demat account to the clearing member's pool account for settlement. Account opening, nomination and demat forms serve different purposes.

  1. AA delivery instruction slip (DIS) signed by RaviCorrect
  2. BA fresh account opening form
  3. CA nomination form
  4. DA dematerialisation request form

Explanation

Securities leave a beneficial owner's demat account only on a valid delivery instruction given by the account holder, normally on a DIS or its electronic equivalent. The other forms relate to opening an account, nominating, or converting physical shares and do not move shares for settlement.

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