King Sasanka – Sri Lankan Writer & Retired Aviation Professional.

For new investors eyeing the Colombo Stock Exchange (CSE), understanding the role of a licensed stockbroker is crucial.  Unlike direct market access in some jurisdictions, Sri Lanka’s regulatory framework mandates that all retail investors trade through approved brokers.  This requirement safeguards investors, ensures market integrity, and facilitates efficient transactions.  Below, we break down why this rule exists, how brokers add value, and what to do if trust is breached. 1. Why Is an Approved Stock Broker Required?   a. Regulatory Compliance & Investor Protection   The Securities and Exchange Commission of Sri Lanka (SEC) requires all investors to trade through licensed brokers to: Prevent fraud and unauthorized trading : Brokers act as intermediaries, verifying investor identities and ensuring transactions comply with laws like the  Securities and Exchange Act of 1987 . Maintain market order : Brokers are bound by SEC r...

Entering the stock market is a significant step toward financial growth.  This guide is designed to clear up common concerns and provide a clear path for new investors to start trading with confidence . Step 1: Open a CDS Account The first requirement is to open a Central Depository System (CDS) account . This acts as a digital vault for your shares. How to Apply: You can register through the CSE Mobile App or directly via the CDS website . Links: * CSE Mobile App (Google Play) CDS Online Account Opening Requirements: You will need to provide your National Identity Card (NIC) number, personal bank account details, and a photograph . Security: Your data is safe; the system strictly follows GDPR and data protection regulations . Step 2: Choose a Stockbroker You cannot trade directly on the floor; you must select an authorized Stockbroker to facilitate your trades . Facilitation: Brokers act as a bridge between buyers and sellers . Selection: You can find a list of authoriz...