NISM Series-XII: Securities Markets Foundation Practice Exam

The NISM-Series-XII: Securities Markets Foundation Certification Examination is intended for individuals at the entry-level who are interested in establishing a career in the securities markets. The primary objective of this examination is to provide participants with a foundational understanding of the Indian securities markets, along with relevant rules and regulations.

Who should take the exam?

This NISM series examination serves as a valuable resource for those seeking fundamental knowledge of the Indian securities markets, including:

• Novice professionals entering the securities markets
• Employees of intermediaries operating within the securities industry
• Professionals from diverse backgrounds keen on familiarizing themselves with the securities markets
• Students
• Homemakers
• Educators

Exam Learning Objectives:

Upon successful completion of the examination, candidates should be able to:

• Learn the fundamental concepts of the Indian Securities Markets.
• Understand the various processes involved in both Primary and Secondary Markets.
• Comprehend the schemes and products offered in Mutual Funds and Derivatives Markets in India.
• Recognize the steps involved in the financial planning process.

Exam Details

• Exam Name: NISM Series-XII: Securities Markets Foundation
• Exam Languages: English
• Fees: (Rs.) 1770+
• Test Duration: 120 minutes
• No. of Questions: 100
• Maximum Marks: 100
• Pass Marks: 60%
• Certificate Validity: 3 years

Course Outline 

The Exam covers the given topics  - 

Domain 1: Understanding Securities Markets and Performance

• Securities Markets
  
• Securities
• Securities Markets: Structure and Participants
• Role of Securities Markets
• Technological advancements in the securities market

Domain 2: Understand Securities: Types, Features and Concepts of Asset Allocation and Investing

• Securities available in the securities market
  
• Choice between Equity and Debt Financing for Issuers
• Characteristics and role of equity capital
• Characteristics and role of Debt securities
• Choosing between Debt and Equity Investment Avenues
• Hybrid Instruments
• Characteristics and role of Commodities as an asset class
• Derivatives as investments
• Asset Allocation and Diversification
• Understanding the factors underlying the investment process
• Various aspects of investing in Equity
• Equity Investing Process
• Various aspects of investing in Debt securities
• Debt Investing Process

Domain 3: Learn about Primary Markets

• Primary Market: Definition and Functions
  
• Primary Vs Secondary Markets
• Intermediaries in Primary Market
• Types of Issues
• Types of Issuers
• Types of Investors
• Regulatory Framework for Primary Markets
• Types of Public Issue of Equity Shares
• Pricing a Public Issue of Shares
• Public Issue Process of equities
• Prospectus
• Applying to a Public Issue
• Listing of Shares
• Rights Issue of Shares
• Regulatory requirements for a Public Issue of Debt Securities
• Public issue process for debt securities
• Private Placements in Equity and Debt

Domain 4: Understand Secondary Markets

• Role and Function of the Secondary Market
• Types of secondary markets for different securities
• Market Structure and Participants
• Brokers and Client Acquisition
• Trade Execution
• Clearing and Settlement of Trades
• Trading and settlement process from investor’s point of view
• Market Information and Regulation
• Risk Management Systems
• Rights, Obligations and Grievance Redressal
• Secondary market trading and reporting for debt securities

Domain 5: Learn about Mutual Funds

• Meaning and Description of a Mutual Fund
• Terms and Concepts Related to Mutual Funds
• Types of Open-ended Mutual Fund Products
• Types of Closed ended Mutual Fund Schemes
• Investment approaches – active and passive
• Processes for Investing in Mutual Funds
• Systematic Transactions
• Switches
• Reading Mutual Fund Information
• Benefits and Costs of Investing in Mutual Funds
• Regulation of Mutual Funds
• Investor Service Standards

Domain 6: Understand about Derivative Markets

• Derivatives
• Underlying concepts in Derivatives
• Types of Derivative Products
• Structure of Derivative Markets
• Trading and Settlement Process: Equity Futures
• Risk Management in Derivative Markets
• Application of Derivatives Products in Risk Management
• Market Indicators