Glossary · Regulation & Institutions
SECP
The regulatory body responsible for overseeing Pakistan's capital markets, corporate sector, insurance industry, and non-banking financial companies. The SECP must license all PSX brokers.
01—What is SECP?
The definition — and what it means in practice.
The Securities and Exchange Commission of Pakistan (SECP) is the regulator responsible for overseeing Pakistan’s capital markets, corporate sector, insurance industry, and non-banking financial companies. In the stock market, the SECP sets and enforces the core rules that govern how securities are issued, traded, disclosed, and supervised. It also oversees market participants’ conduct, including licensing requirements for intermediaries that deal with investors.
For investors, the SECP matters because it provides the regulatory framework that helps markets function fairly and transparently. It is the body that must license all Pakistan Stock Exchange (PSX) brokers, which affects who can legally take client orders and handle client assets. SECP oversight also underpins disclosure standards for listed companies, helping investors compare companies using audited information rather than relying only on rumours or price moves.
SECP is the regulator: before you trade Rs 100 worth of shares on the PSX, your broker must be SECP-licensed to legally execute and handle that trade.
- SECP regulates Pakistan’s capital markets and supervises key financial-sector segments outside banking.
- All PSX brokers must be licensed by the SECP, affecting investor protection and market integrity.
- SECP oversight supports disclosure and governance standards for listed companies.
- Regulation does not eliminate risk; it sets the rules and accountability for market participants.
02—How secp works on the PSX
The Pakistan-specific rules, conventions, and numbers.
On the Pakistan Stock Exchange, the SECP is the regulator. The PSX was formed in 2016 by merging the Karachi, Lahore, and Islamabad stock exchanges, and it operates under SECP regulation. In day-to-day investing, this shows up through regulated membership and market conduct requirements that shape how trading is organised and supervised.
A PSX investor typically encounters SECP requirements indirectly through the market’s plumbing and participant checks. Brokers must hold a Trading Right Entitlement Certificate (TREC) licence, every investor needs a Unique Investor Number (UIN), trades clear through NCCPL, and shares are held electronically at the Central Depository Company (CDC). These elements work together to support orderly trading and post-trade settlement (T+1).
03—Common misconceptions
Where investors most often get this wrong.
SECP guarantees I will not lose money in PSX shares.
SECP regulates market conduct and participant licensing, but it does not guarantee profits or prevent normal market losses from price changes.
If a company is listed, SECP has approved it as a good investment.
Listing and regulation are about rules, disclosure, and governance. They are not a judgement that a company is attractive or safe.
Only the PSX, not the regulator, matters once I start trading.
The PSX runs trading, but it does so within a regulatory framework. SECP oversight influences broker licensing and market standards that investors rely on.
04—Using secp on BSL
Where this term shows up across the platform — with live data.
- Check market-wide activity and context on the Market.
- Browse listed companies and symbols via Stocks.
- Track upcoming company events on Board Meetings.
- Learn related terms in the Glossary.
05—Frequently asked questions
What investors ask about secp on the PSX.
Frequently Asked Questions
SECP regulates Pakistan’s capital markets, including the framework under which the PSX operates. It sets and enforces rules around market conduct, disclosures, and supervision, and it licenses key market intermediaries such as PSX brokers.
No. The PSX is the stock exchange where trading takes place. The SECP is the regulator that oversees the capital markets and regulates the PSX and market participants.
Yes. The SECP must license all PSX brokers. In practice, this means a broker needs the required regulatory permissions to legally offer brokerage services to investors.
In PSX investing, trades clear through NCCPL and shares are held electronically at the CDC. These are part of the market’s post-trade and custody infrastructure that operates within the regulated capital-markets framework.
PSX settlement is T+1 (one business day). Investors experience this through the timing of when trades are completed and reflected in holdings and cash after execution.
06—Related terms
Keep building the picture.
The sole stock exchange in Pakistan, formed in 2016 through the merger of the Karachi, Lahore, and Islamabad stock exchanges. Headquartered in Karachi, the PSX lists over 500 companies across multiple sectors.
A licensed member of the stock exchange who executes buy and sell orders on behalf of clients and may also provide investment advice. All PSX stockbrokers must hold a valid TREC and be registered with the SECP.
The licence that authorises a brokerage firm to trade on the Pakistan Stock Exchange. All legitimate PSX brokers must hold a valid TREC issued by the PSX.
A unique identification number assigned to every investor registered on the PSX. Required to trade on the exchange. Issued by a licensed broker upon account opening.
The entity responsible for clearing and settlement of trades executed on the PSX. Ensures that both the buyer and the seller receive shares and payment upon settlement of the trade.
The institution responsible for maintaining electronic records of securities ownership in Pakistan. All PSX-traded shares are held in dematerialised form through the CDC. Investors access their holdings via a CDC Investor Account or through their broker's sub-account.
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