Financial Awareness - Risk, Stability & Emerging Finance
Which of the following entities is responsible for the settlement of trades executed on stock exchanges in India?
Which of the following entities is responsible for the settlement of trades executed on stock exchanges in India?
medium Q5 of 15
Step-by-Step Solution
Step 1: Understand trade settlement process
After trades are executed on stock exchanges, settlement involves transfer of securities and funds.Step 2: Identify responsible entity
Clearing Corporations act as intermediaries ensuring smooth settlement of trades. Brokers execute trades, Depository Participants hold securities, and Registrars maintain shareholder records.Final Answer:
Clearing Corporation → Option DQuick Check:
Trade settlement = Clearing Corporation ✅
Quick Trick: Clearing Corporations guarantee settlement of trades.
Common Mistakes:
- Confusing brokers or depository participants with clearing functions.
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