Question
Which of the following issued by registered foreign portfolio investors to overseas investors who want to be part of the Indian stock market without registering themselves directly?
(a) Certificate of Deposit
(b) Commercial paper
(c) Promissory Note
(d) Participatory Note
Answer:
D
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Explanation:
Participatory Notes are offshore derivative instruments issued by FPIs registered with the Securities and Exchange Board of India (SEBI). They allow foreign investors to indirectly invest in Indian securities without undergoing the formal registration process with SEBI. P-Notes provide an avenue for foreign investors to gain exposure to the Indian stock market.