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NISM Certifications · NISM-Series-X-A: Investment Adviser (Level 1) · Operational Aspects of Investment Management

Which statement about trade settlement for equity shares on Indian exchanges is correct as taught at this level?

Indian equity cash market trades settle on a rolling basis with a standard T+1 cycle, meaning settlement happens one working day after the trade. The clearing corporation guarantees settlement and securities move in demat form, so monthly or physical-delivery settlement is incorrect.

  1. ACash market trades settle on a rolling basis, with T+1 as the standard settlement cycleCorrect
  2. BCash market trades settle only once a month on a fixed day
  3. CSettlement occurs only after the client physically delivers share certificates
  4. DSettlement is done directly between buyer and seller without a clearing corporation

Explanation

Indian equity cash markets follow a rolling settlement, with the standard cycle now T+1. The clearing corporation acts as counterparty, and securities are held in demat form, so monthly, physical-delivery and bilateral descriptions are wrong.

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