Sample Questions
NISM-Series-6: Depository Operations Mock Tests — 5 random MCQs with answers & explanations
← Back to NISM-Series-6: Depository Operations Mock TestsThese 5 questions are randomly selected (standard MCQs only, not case-based).
Q1 The "Automatic Delivery Out" (ADO) mechanism, which automates security transfers based on settlement obligations, is supported by which Indian depository?
Explanation:
The ADO system helps settle trades efficiently by automatically generating instructions. Both of India's main depositories, NSDL and CDSL, provide this facility to their clearing members and corporations.
Marks: 1
Q2 For a Basic Service Demat Account (BSDA), if there are no holdings and no transactions, no further statements are required.
Explanation:
To reduce costs, BSDA rules state that if an account is empty and inactive, the DP does not need to send statements.
Marks: 1
Q3 True or False: For the purpose of pledging or hypothecating shares, the borrower (pledgor) and the lender (pledgee) can have their accounts with different depositories.
Explanation:
Currently, both parties involved in a pledge must have their beneficial owner accounts within the same depository because inter-depository pledging is not yet allowed.
Marks: 1
Q4 To which authority should an entity submit its application to register as a Depository Participant (DP)?
Explanation:
An applicant must apply through the Depository they wish to join. The Depository reviews the application and sends it to SEBI with its recommendation within 30 days.
Marks: 1
Q5 Which specific legislation allows for the creation of more than one depository in India?
Explanation:
The Depositories Act of 1996 was passed to encourage competition in depository services. This led to the establishment of both NSDL and CDSL in India.
Marks: 1
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