NISM-Series-V-A: Mutual Fund Distributors Certification Examination (NISM Exam) is run by the National Institute of Securities Market to make sure that the intermediary has a good grasp of the basics. A person can only become a mutual fund agent after he or she passes the NISM Certifications test Individual Mutual Fund Distributors, employees of organizations that sell and distribute mutual funds, and employees of Asset Management Companies (AMC) are all candidates for the NISM certifications. These certifications are best to set a common minimum level of knowledge for all the candidates, including people who sell and distribute mutual funds. The goal of the certification is to improve the quality of sales, distribution, and other services in the industry.
Eligibility for NISM Certifications
According to the rules set by the National Institute of Securities Market (NISM), you should do this:
1.) In order to become a mutual fund distributor or advisor, you need to be at least 18 years old.
2.) AMFI’s website says that there is no educational requirement for this job.
Mode To Appear in the NISM Exam
1.) AMFI (Association of Mutual fund )says that people can take the exam in Hindi or English.NISM certification exams to become a mutual fund distributor are available in both Online and Offline modes in Hindi or English.
How much do I have to pay for NISM certification?
As part of the registration process for the NISM exam, a person has to pay Rupees 1500/- as fees.
You can pay the fee with a credit card, debit card, or bank account.
The NISM certificate is valid for how long?
AMFI’s website says that the certificate will be valid for about three years.
Exam Pattern for NISM Certification
1.) Each question will be worth 1 point (Maximum marks 100)
2.) To be able to clear the exam, you must score at least 50% of the questions right.
3.) There will be no negative marking.
NOTE: To get your certificate, make sure you put or update your Income Tax Permanent Account Number (PAN) in your registration information.
NISM Series VA – Name of Module
How do to Enroll or apply for the NISM Exam?
1.) For registering for NISM certification exams, you can go to the NISM website and click on the “New Account” option.
2.) For NISM exams, you have to register first. Fill in your profile. A JPG copy of the passport-size photo, the Aadhar Card, and the PAN Card would need to be scanned and sent in.
3.) The profile will be updated/approved in three days after the registration and verification steps are done.
4.) Check your account to book the NISM Series V-A test (Available in Hindi & English Language).
5.) Booking: Choose a city, time slot, and pay Rs.1500/-.
6.) If you want to take an exam from home and do it online, choose “online” in the location field.
7.) When you sign in to the NISM portal, the workbook will be there. Then, download and study for the test.
As soon as you pass the exam, you have to apply for the certification exam from ARN!
Tip: enroll for an exam after 3 weeks so that you can prepare for the exam.
Exam Syllabus for NISM Certifications
In order to pass the Mutual Fund Distributors Certification Exam, people need to know the whole syllabus for the NISM exam.Following are the topics that make up the NISM curriculum.
I. Investment Landscape
- In order to understand the Indian economy, you need to know its rules. As you read this, describe investors and what they want to do with their money
- Understand how to save and invest money, and how they work together
- Discuss Different Types of Assets
- Understand the different types of investment risks.
Explain how to measure and manage risk.
- Understand how people make investment decisions based on their emotions.
- Risk profiling is a way to figure out how much risk there is.
- Explain the Asset Allocation Difference between the two methods: Do-it-yourself and getting help from a pro.
II. Mutual Funds:
- Explain what a mutual fund is.
- Understand the different types of mutual funds.
- There has been a lot of growth in the mutual fund business in India.
III. The legal structure of mutual funds
- It would be good to show you how mutual funds work in India.
- Understand how Asset Management Company is run.
- Take a look at how service providers help mutual funds work and what they do.
- Explain what AMFI does, and why it’s important.
- Understand what the main parts of a Mutual Fund are.
IV: Legal and Regulatory Structure
- A regulator is a person who makes sure that things are done the right way.
- It’s important to talk about how the Securities and Exchange Board of India helps people in India.
- Know how AMCs check out distributors of mutual funds to make sure they’re good people.
- It’s important to know about SCORES and the AMFI Code of Conduct for Financial Intermediaries.
V. Scheme-Related Information
- How to read and understand the Mandatory Documents and what they are for and why they are important
- Explain the disclosures that aren’t required.
VI. Fund Distribution and Channel Management Practices
- Explain why mutual fund distributors are important and how they work.
- Understand the different types of people who sell mutual funds.
- Explain the different modes of distribution
- Understand what it takes to become a distributor of the Mutual Fund.
- Explain how a mutual fund distributor makes money.
- Make sure you know the Commission Disclosure required by SEBI.
- Explain how AMCs check out Distributors of Mutual Funds to make sure they aren’t going to get scammed by the funds they sell.
- Discuss Nomination facilities for Agents / Distributors and Payment of Commission to Nominee
explain the change of distributor
VII: Net Asset Value, Total Expense Ratio, and the Price of a Unit
- Discuss the principles of fair valuation.
- Elaborate or compute net assets of a mutual fund scheme and NAV
- Know about the concept of entry and Exit Load and how it affects the NAV
- Explain Dividends and distributable reserves
- Explain the Key Accounting and Reporting Requirements applicable to mutual funds.
- Know about the NAV, Total expense ratio, and pricing of units for the Segregated Portfolio
- Understand how different taxes apply to mutual funds.
- Capital gains, capital gains (long term and short term) tax, and indexation are things you need to know.
- Explain the difference between dividend distribution tax and capital gains tax
- Under the Income Tax Act, learn about how to write off your gains and losses. You also need to know about the Securities Transaction Tax.
- Section 80C of the Income Tax Act gives you tax benefits if you invest in mutual funds. You need to know about this.
- Learn more about Tax Deducted at Source (TDS) in mutual funds, and how it works.
- Understand the use of GST in mutual funds
IX. Investor Services
- Describe how the NFO process works.
- Explain the New Fund Offer Price.
- Different types of investment plans and options should be talked about.
- Explain how the mutual fund units are given to the person who buys them.
- Describe the content and how often Statements of Accounts for investments are made.
- The following is a list of different types of Mutual Fund Investors that you should know about.
- how to fill out the application form for mutual funds
- Explain the financial transactions with mutual funds (Purchase, Redemption and Switches)
- Describe Cut-off time and Time Stamping
- Explain the KYC requirement for mutual fund investors
- Different types of systematic transactions &operational aspects of systematic transactions
- Explain the change in Status of Special Investor Categories
- Explain the change in Status of Special Investor Categories
- Discuss Investor Transactions–turnaround times
X. Risk, return, and performance of funds
- Understand both the general and specific risks.
- Discuss the Factors that affect mutual fund performance
- Explain Drivers of Returns and Risk in a mutual fund Scheme
- Discuss the Measures of Returns
- knowledge about the SEBI norms regarding representation of returns by mutual funds in India
- Discuss risks in fund investing with a focus on investors
- Explain the Measures of Risk
- What are certain provisions with respect to credit risk
XI. Mutual Fund Scheme Performance
- Differentiate Price Return Index and Total Return Index
- Find out how to choose a good performance benchmark.
- Explain the use of market benchmarks to evaluate Equity Fund Performance
- Explain how market benchmarks are used to measure the performance of debt. Explain the use of market benchmarks to evaluate Debt Fund Performance DA.
- Describe Quantitative Measures of Fund Manager Performance
- Describe how market benchmarks are used to evaluate Other Schemes
- Make sure you understand what tracking error is
- Get details about the different sources for disclosure of scheme performance (Scheme documents, AMFI and AMC website and Fund Fact Sheet).
XII. Mutual Fund Scheme Selection
- Discuss Scheme Selection based on investor needs, preferences, and risk profile
- Discuss Risk Levels in mutual fund schemes
- Elaborate about selecting options in mutual fund schemes
- Discuss Scheme Selection based on the investment strategy of mutual funds
- Discuss Selection of Mutual Fund scheme offered by different AMCs or within the scheme category
- Discuss do’s and Don’ts while selecting mutual fund schemes
- NISM Exam Study Material
If you want to pass the NISM exam with good grades and on your first try, you need to do a lot of studying. To help you with this, you can use the Mutual Fund Mock Test by iexamworld on https://nism.iexamworld.com/