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NISM Certifications · NISM-Series-VIII: Equity Derivatives · Legal and Regulatory Environment

Who is permitted to act as a clearing member for the derivatives segment of a recognised exchange?

Only members meeting the net worth, deposit and other eligibility conditions of the clearing corporation and SEBI can act as clearing members. Retail investors are not eligible, and clearing is not confined to the exchange itself or to depository participants.

  1. AAny retail investor with a demat account
  2. BA member who meets the net worth and other eligibility conditions prescribed by the clearing corporation and SEBICorrect
  3. COnly the stock exchange itself
  4. DOnly a bank's depository participant

Explanation

Clearing members are admitted by the clearing corporation only if they meet net worth, deposit and other prescribed conditions. Retail investors cannot clear trades, and clearing is not restricted to the exchange or depository participants.

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