Membership of the Exchange is open to persons wishing to becoming members of the Exchange subject to their fulfilling requirements and criteria as specified by the Exchange.
Members are admitted in the following categories:
1. Clearing Member (CM)
CM is a person/corporate who is admitted by the exchange as a member, conferring upon him a right to trade and clear through the Clearing House of the Exchange, as a Clearing Member. The CM has the right to execute transactions in the trading system of the exchange like broker member. CM also has a right to clear the transactions in contracts executed in NSE either for itself or on behalf of other broker members.
CM can appoint their sub-brokers, set up their branch offices and franchises. Members can charge brokerage or commission from their clients, as may be negotiated between them.
The number of CM will be limited compared to that of BM in NSE. CM will be located in major towns and have banking accounts with the Designated Clearing Banks who have interface with NSE
2. Broker Member (BM)
BM is a member of NSE who has the right to execute transactions in the trading system of the exchange and the right to have contracts in its own name. Further the BM can also appoint sub-brokers, authorized persons, and Trading Members who would be registered as Registered User at the NSE trading platform. As a Member, s/he can deal on behalf of the clients. All the trades have to be executed only through the Trading facilities provided by the Exchange. BM will settle the transactions through Clearing Members.
There are basically two types of Broker Members:
1. Institutional Member
- Company must be registered under the company act 2063B.S.
- It can either be a sole proprietorship or a partnership firm.
- The objective of the company should be in line with the objective of the exchange.
- They can trade themselves as well as on behalf of their clients
2. Professional members
- Should have minimum 5 to 7 years of experience in the field of derivative market.
- Company must be registered under company act 2063B.S.
- They have the right to introduce only the corporate clients.
- They are not allowed to trade for themselves.
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