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NISM Certifications · NISM-Series-VII: Securities Operations and Risk Management · Market Participants in the Securities Market

Which market participant, regulated by SEBI, is permitted to hold clients' securities in dematerialised form and give effect to transfers on the instructions of the beneficial owner through a Depository Participant?

A depository holds securities in dematerialised form and records transfers of beneficial ownership based on instructions routed through Depository Participants. Clearing corporations settle trades, exchanges provide trading platforms, and registrars maintain issuer records, so none of those performs the depository's custody and transfer function.

  1. AClearing corporation
  2. BDepositoryCorrect
  3. CStock exchange
  4. DRegistrar and transfer agent

Explanation

A depository such as NSDL or CDSL holds securities in electronic form and records transfers of ownership, with Depository Participants acting as its agents. A clearing corporation handles trade settlement obligations, not holding of securities for investors. Exchanges provide the trading platform, and RTAs maintain issuer records for investors.

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