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NISM Certifications · NISM-Series-VII: Securities Operations and Risk Management · Other Services Provided by Brokers

Under the SEBI framework for research analysts, which of the following best describes the purpose of a broker offering a Research Analyst service to clients?

A broker providing research recommendations must do so as a SEBI-registered research analyst or through a registered research analyst entity. Guaranteeing returns, trading without client orders, or replacing the clearing corporation are not permitted or relevant functions.

  1. ATo provide recommendations on securities only after registration as a research analyst or through a registered research analyst entityCorrect
  2. BTo execute trades on behalf of clients without client orders
  3. CTo guarantee returns on recommended securities
  4. DTo replace the clearing corporation in settling trades

Explanation

Research reports and recommendations on securities must be issued by a person registered as a research analyst under SEBI regulations. Brokers can offer such services through a registered research analyst entity. Guaranteeing returns or executing without client orders is prohibited.

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