n NISM Certifications
XV NISM Series XV
Medium

Which of the following methods of determining bonuses for research analysts is prohibited under Regulation 17?

Practice question from NISM XV Mock Test 1 — bank. The correct answer is highlighted below with a full explanation.

Options

  1. A

    Bonus based on client ratings

  2. Bonus linked to brokerage generated from covered companies

    Correct answer

  3. C

    Bonus based on number of companies researched

  4. D

    Bonus based on stock performance recommendations

Why this is the answer

Regulation 17 prohibits linking analyst bonuses to revenue from investment banking or brokerage for the companies they cover, to avoid conflicts of interest.

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