2016
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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PFRDA
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FMC
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RBI
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SEBI
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Detailed explanation-1: -P-notes can be used to purchase any Indian security an investor wants through a series of steps. Funds transfer from the investor to the FII account, and the FII issues the participatory notes to the client and buys the underlying stock or stocks in the correct quantities from the Indian marketplace.
Detailed explanation-2: -P-notes have Indian stocks as their underlying assets. FPIs are non-residents who invest in Indian securities like shares, government bonds, corporate bonds, etc.
Detailed explanation-3: -Participatory notes are issued by brokers and FIIs registered with SEBI. The investment is made on behalf of these foreign investors by the already registered brokers in India. For example, Indian-based brokerages buy India-based securities and then issue participatory notes to foreign investors.
Detailed explanation-4: -Participation Notes are derivative instruments linked to financial instruments which usually include equities, market indices, ETFs, interest rates, currencies, or a combination of these. Investors can enjoy a potential capital gain in case their market anticipation on the underlying financial instrument is correct.