NISM Series XXV-A common mistakes
NISM Series XXV-A · Understand the traps and how to avoid them.
Treating the 'persons associated with research services' definition as covering only analysts and research report authors, and assuming sales, marketing, and back-office staff fall outside the regulatory perimeter.
Candidates skim the definition and anchor on the word 'research', so they miss that the scope is activity- and role-based and extends to anyone involved in the research service chain, including sales and distribution personnel. The chapter title in the syllabus mentions 'Sales and Other Non-Core Services', which should be a cue that non-analyst roles are examinable.
What to do instead
Build a one-page role map: analyst, research report preparer, reviewer/approver, sales/distribution, marketing, compliance, and support staff - and for each note whether they are covered, what conduct obligations attach, and which conflicts-of-interest rules apply. Test yourself by classifying 15 hypothetical job descriptions.
Confusing the conflict-of-interest rules for research analysts with those for sales and marketing staff, applying the trading-restriction and blackout rules to salespeople who merely distribute reports.
Many prep materials group 'associated persons' into one bucket, and candidates memorise the analyst restrictions as if they were universal. The exam deliberately tests role-differentiated obligations, so a blanket application produces wrong answers.
What to do instead
Make a two-column comparison table (analyst vs. non-core/sales role) across: personal trading, pre-clearance, blackout windows, handling of unpublished recommendations, and disclosure duties. For each row, write the reason the rule differs, so you can reason rather than recall.
Assuming that because a salesperson does not write research, no disclosure or independence obligations apply when they communicate with clients about a recommendation.
Candidates equate 'non-core service' with 'low regulation'. In practice, anyone communicating research-driven recommendations must preserve the integrity of the research and avoid misrepresenting it, and the exam tests this boundary.
What to do instead
Study the communication chain: who may convey a recommendation, what must accompany it, and what cannot be altered or selectively emphasised. Practise scenario questions where a salesperson paraphrases or selectively quotes a report and identify the specific breach.
Misidentifying who is responsible for supervision and approval of research-related activities, attributing sign-off to the sales head or business head rather than the designated research/compliance function.
In real firms, reporting lines are mixed, and candidates import workplace intuition instead of the exam's governance model. Questions on approval, review, and escalation are common and trap candidates who answer by hierarchy rather than by function.
What to do instead
Draw the governance flowchart from memory: preparation, review, approval, distribution, and escalation of conflicts. Label each box with the responsible function and the record that must be kept. Redraw weekly until it is automatic.
Treating the Chinese wall / information barrier as a single abstract concept and failing to state the concrete operational controls (physical separation, restricted access, watch/restricted lists, escalation) when a scenario question asks what should have been done.
Candidates learn the phrase but not the mechanics, so they choose a vague answer like 'maintain confidentiality' over the specific control the question is testing.
What to do instead
Memorise a checklist of barrier controls and practise writing the three most specific controls that would have prevented a given leak scenario. Compare your list against the model answer and note which control you omitted.
Overlooking record-keeping, reporting, and escalation obligations for non-core staff - for example, failing to recognise that client complaints, gifts, or outside business interests of sales staff must be logged and escalated.
These obligations feel administrative, so candidates deprioritise them while focusing on analyst conduct. Exam questions often hinge on whether an event must be recorded or reported, not on the substantive advice itself.
What to do instead
Create an 'event → action → record' table for non-core roles: gifts and hospitality, outside employment, client complaints, conflicts disclosures, and personal account dealings. For each, note the threshold, the escalation route, and the retention requirement.
Answering questions about marketing and distribution of research by assuming promotional material is unregulated, or by failing to distinguish research reports from marketing communications.
Candidates conflate 'marketing' with 'advertising' and assume the research chapter does not reach it. The exam tests the boundary between what counts as a research report and what is marketing material, and the different standards each attracts.
What to do instead
Write a decision tree: is the content a recommendation or analysis (research) or a promotion of services (marketing)? Then list the standard applicable to each. Practise with 10 sample artefacts described in words and classify each.
Ignoring the distinction between 'associated person' status arising from employment/engagement versus conduct, and therefore misjudging whether a former employee or an outsourced distributor is covered.
Candidates assume coverage ends at the employment contract. The exam probes edge cases such as contractors, third-party distributors, and departed staff whose prior recommendations remain in circulation.
What to do instead
List the triggers for coverage (contract, role, activity, access to information) and test each against the edge cases. Note the point at which obligations cease and what continuing obligations survive, such as confidentiality and record retention.
Relying on general securities-market knowledge or workplace habit for conduct questions instead of the specific standard in the syllabus, producing answers that are reasonable in practice but wrong on the exam.
Experienced practitioners answer from intuition, and the exam's standards are often stricter or more specific than day-to-day practice. This is the most common source of near-miss scores.
What to do instead
For every practice question you get wrong, write the exact rule that governs and the intuition that misled you. Build a 'practice vs. standard' log and review it before the exam; do not rely on experience for conduct items.
Skipping the non-core services material because it appears peripheral, and allocating all revision time to the analyst-centric chapters.
The syllabus heading names sales and other non-core services explicitly, and candidates underestimate its weight. They then meet unfamiliar questions on distribution, marketing, and supervision and guess.
What to do instead
Allocate revision time proportional to the syllabus weight, not to perceived interest. Do a timed mock section on non-core roles alone, score it, and reallocate study hours based on the gap rather than on comfort.