Select the correct sequence of first five steps involved in the Trading and Settlement Procedure of Stock Exchange:

(A) Matching the share and best price available by broker
(B) Approach to a registered broker
(C) Open a Demat Account
(D) Issuance of a trade confirmation slip by broker to the investor
(E) Place an order of buying or selling with the broker

Choose the correct answer from the options given below:

(B), (C), (E), (A), (D)

The correct answer is option 3- (B), (C), (E), (A), (D).

The following steps are involved in the screen-based trading for buying and selling of securities:

(B) Approach to a registered broker- If an investor wishes to buy or sell any security he has to first approach a registered broker or sub-broker and enter into an agreement with him. The investor has to sign a broker-client agreement and a client registration form before placing an order to buy or sell securities. He has also to provide certain other details and information.

(C) Open a Demat Account - The investor has to open a ‘demat’ account or ‘beneficial owner’ (BO) account with a depository participant (DP) for holding and transferring securities in the demat form. He will also have to open a bank account for cash transactions in the securities market.

(E) Place an order of buying or selling with the broker- The investor then places an order with the broker to buy or sell shares. Clear instructions have to be given about the number of shares and the price at which the shares should be bought or sold. The broker will then go ahead with the deal at the above mentioned price or the best price available. An order confirmation slip is issued to the investor by the broker.

(A) Matching the share and best price available by broker- The broker then will go on-line and connect to the main stock exchange and match the share and best price available.

(D) Issuance of a trade confirmation slip by broker to the investor- When the shares can be bought or sold at the price mentioned, it will be communicated to the broker’s terminal and the order will be executed electronically. The broker will issue a trade confirmation slip to the investor.