NISM Series V-A study guide
NISM Series V-A · Work through your exam, one topic at a time.
The NISM-Series-V-A Mutual Fund Distributors Certification Examination is one of the certification examinations offered by the National Institute of Securities Markets (NISM) - a public trust established in 2006 by the Securities and Exchange Board of India (SEBI), the regulator of the securities markets in India. NISM lists it in the Mutual Fund group of certifications, alongside the NISM-Series-V-B Mutual Fund Foundation Certification Examination and the newer NISM-Series-V-D Mutual Fund – Specialized Investment Fund Distributors Certification Examination. The NISM Series V-A study guide has 10 sections and about 3,562 words.
01Introduction to the Securities Market
Every securities transaction sits in one of two places. The primary market is where an issuer raises fresh capital - IPO, FPO, rights issue, preferential allotment, debt issuance.
339 words, about 2 min02Concept and Role of a Mutual Fund
A mutual fund is a trust that pools money from many investors and invests it in a diversified portfolio of securities according to a stated objective. Each investor holds units , and the unit value - the NAV - is the market value of the pool's net assets divided by units outstanding.
376 words, about 2 min03Legal Structure of Mutual Funds in India
A mutual fund in India is set up as a trust and operates through four parties, each with a defined role. Sponsor - the promoter.
379 words, about 2 min04Mutual Fund Products and Scheme Categories
SEBI permits one scheme per category per AMC (plus one index fund and one ETF per category), which makes classification questions predictable. Equity schemes - minimum 80% in equity unless stated: multi cap (25/25/25 across large/mid/small), large cap (top 100), mid cap (101–250), small cap (251 onwards), large & mid cap (35/35), flexi cap (65%+), focused (max 30 stocks), ELSS (80%+ equity, 3-year lock-in , eligible for Section 80C), sectoral/thematic (80%+ in the theme), value/contra.
348 words, about 2 min05Fund Distribution and Channel Management Practices
Channels include individual mutual fund distributors (IFAs), corporate agents, banks, NBFCs, national distributors, online platforms, and fee-only Registered Investment Advisers. Distributors earn commissions from the AMC (upfront and trail); RIAs earn fees from the client .
362 words, about 2 min06Scheme Selection and Investor Profiling
Investor profiling has two dimensions. Risk capacity is the financial ability to absorb loss - income stability, net worth, existing liabilities, dependants, time horizon, liquidity needs.
369 words, about 2 min07Measuring and Managing Risk in Mutual Fund Schemes
Systematic (market) risk affects the whole market and cannot be diversified away: equity price risk, interest-rate risk, currency risk, inflation risk, political risk. Unsystematic risk is security- or issuer-specific - credit risk, business risk, liquidity risk, concentration risk - and can be reduced by diversification.
333 words, about 2 min08Performance of Mutual Fund Schemes
Absolute (point-to-point) return = (End − Begin) ÷ Begin × 100. It ignores time and is fine only for periods under a year.
351 words, about 2 min09Investor Services, Operations and Compliance
KYC (with PAN), FATCA/CRS, a unique client code, bank mandate and nomination are the basics of account opening. Investors then use lumpsum purchases, SIP (periodic purchase), STP (transfer between schemes of the same AMC) and SWP (periodic withdrawal).
351 words, about 2 min10Accounting, Valuation and Taxation of Mutual Funds
Fund accounts are kept on an accrual basis, with income and expenses recognised as they arise. NAV is computed daily: (total assets − total liabilities) ÷ units outstanding.
354 words, about 2 min