NISM Series XXI-A case studies
NISM Series XXI-A · Put your knowledge to work in context.
NISM Series XXI-A is the Portfolio Management Services (PMS) Distributors Certification Examination, one of the certification examinations listed by the National Institute of Securities Markets (NISM) under its Portfolio Management Services category. NISM describes itself as a public trust established in 2006 by the Securities and Exchange Board of India (SEBI), the regulator of the securities markets in India, carrying out capacity building activities aimed at enhancing quality standards in the securities markets. The NISM Series XXI-A case studies are 5 cases and about 3,478 words.
1Two ₹40 Lakh Tickets and a Distributor's 60 Basis Points
Meera and Arjun, both 44, run a design studio and have been referred to you by a mutual fund distributor. They want discretionary PMS accounts in a large-cap strategy and each proposes to invest ₹40 lakh - ₹80 lakh in total - asking that the two accounts be treated as one client so that the ₹50 lakh floor is met.
717 words, about 4 min2High-Water Marks After a Down Year
On 1 April 2023 a client invested ₹1,00,00,000 in a discretionary multi-cap strategy. The fee schedule is a 1% annual management fee, billed separately, plus a performance fee of 20% of the increase in portfolio value above the high-water mark, crystallised and billed every 31 March.
667 words, about 3 min3A 68-Year-Old Client Who Wants the 46% Strategy
A retired couple, aged 68 and 64, hold ₹4.20 crore in fixed deposits and receive ₹18 lakh a year of pension income. They need about ₹1.40 lakh a month for household expenses and have earmarked ₹60 lakh for a daughter's house purchase in eight months.
714 words, about 4 min4The Exit That Took Sixty Days
On 3 February a private limited company with a ₹3.40 crore discretionary PMS account emails a full-redemption instruction signed by its managing director. The portfolio is 22% in unlisted equity and 12% in a small-cap position for which the manager says "there is no buyer at any price".
698 words, about 3 min5A WhatsApp Broadcast and a 15% Drawdown
He is actually onboarded to the firm's balanced strategy, which returns 9%, while the small-cap strategy falls 15% by September. He then learns that the 46% was one client's twelve-month return, that his distributor earns a 0.70% trail, and that his gains will be taxed in his own hands.
682 words, about 3 min