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NISM V-A Certification: Become a Mutual Fund Distributor

Updated: Oct 16, 2023


NISM V-A Certification

Are you interested in becoming a Mutual Funds Distributor and helping investors manage their mutual fund investments? All you need to do is appear for the NISM V-A exam and receive the NISM Certification to become a registered Mutual Funds Distributor.


Here are eight simple guidelines to help you in your journey to appear & qualify for the NISM V-A exam and obtain the NISM Certification for becoming a registered Mutual Funds Distributor. Read through the bonus point: How to commence your business and become a successful Mutual Funds Distributor!

Table of Content:

OBJECTIVES OF NISM V-A EXAMINATION

The NISM Series V-A Certification aims to make candidates:

  1. Know the basics of mutual funds, including their features, structure, and various mutual fund schemes.

  2. Understand the process of distributing mutual funds in the marketplace, evaluate mutual fund schemes, and recommend suitable products and services to existing and prospective investors in the market.

  3. Become familiar with the legal, accounting, valuation, and taxation aspects of mutual funds and their distribution.

  4. Practice financial planning as an approach to investing in mutual funds, and develop long-term relationships with their clients.


ELIGIBILITY TO APPEAR FOR NISM V-A EXAM

Candidates eligible to appear for the NISM V-A exam include individuals above 18 years of age who have completed a minimum of three years bachelorette degree from any recognized educational institution and who are currently,

  • Being employees of organizations working as mutual fund distributors or,

  • Being employees of any Asset Management Company (AMC), especially those involved in the sales/distribution of mutual funds or,

  • Want to begin a career in the sale/ distribution of mutual funds.


PATTERN OF NISM V-A EXAM

The most important step to succeed in any mutual funds distributor exam is to have a good knowledge of the syllabus covered, including marks and examination patterns. Here is a quick glimpse of the mutual fund distributor exam syllabus and mutual funds distributor exam pattern of the NISM V-A examination.

  1. The mutual funds distributor exam is conducted in an offline computer-based model. That is, candidates must appear for the exam at a physical location and take this exam through a computer.

  2. The mutual fund advisor exam pattern comprises 100 multiple choice questions for 100 marks, and the duration is 2 hours (120 minutes).

  3. The minimum pass mark is 50%, with no negative marking for incorrect answers.

  4. The candidate must pay an amount of Rs.1,500+GST to register for the NISM V-A exam.

  5. The mutual fund advisor exam is conducted at various locations across India.

SYLLABUS OF NISM V-A EXAM

The detailed syllabus of the NISM V-A Exam including the chapters and contents of each chapter as provided in the official study material is produced here for your immediate reference. This Mutual Fund Distributor Exam Syllabus will help you gather an idea as to what you will study and will help prepare accordingly.


CHAPTER 1: INVESTMENT LANDSCAPE
  • Investors and their Financial Goals

  • Savings or Investments?

  • Different Asset Classes

  • Investment Risks

  • Measures and Management Strategies

  • Behavioral Biases in Investment Decision Making

  • Risk Profiling

  • Understanding Asset Allocation

  • Do-it-yourself versus Taking Professional Help

CHAPTER 2: CONCEPT AND ROLE OF A MUTUAL FUND
  • Concept of a Mutual fund

  • Classification of Mutual Funds

  • Growth of the mutual fund industry in India

CHAPTER 3: LEGAL STRUCTURE OF MUTUAL FUNDS IN INDIA
  • Structure of Mutual Funds in India

  • Constituents of a Mutual Fund

  • Organization Structure of Asset Management Company

  • Role and Support function of Service Providers

  • Role and Function of AMFI

CHAPTER 4: LEGAL AND REGULATORY FRAMEWORK
  • Role of Regulators in India

  • Role of Securities and Exchange Board of India

  • Due Diligence Process by AMCs for Distributors of Mutual Funds

  • Investor Grievance Redress Mechanism

  • AMFI Code of Conduct for Intermediaries

CHAPTER 5: SCHEME RELATED INFORMATION
  • Mandatory Documents

  • Non-Mandatory Disclosures

CHAPTER 6: FUND DISTRIBUTION AND CHANNEL MANAGEMENT PRACTICES
  • The role and importance of mutual fund distributors

  • Different kinds of mutual fund distributors

  • Modes of distribution

  • Prerequisites to become Distributor of a Mutual Fund

  • Revenue for a mutual fund distributor

  • Commission Disclosure mandated by SEBI

  • Due Diligence Process by AMCs for Distributors of Mutual Funds

  • Difference between distributors and Investment Advisors

  • Nomination facilities to Agents/Distributors and Payment of Commission to Nominee

CHAPTER 7: NET ASSET VALUE, TOTAL EXPENSE RATIO AND PRICING OF UNITS
  • Fair Valuation Principles

  • Computation of Net Assets of Mutual Fund Scheme and NAV

  • Dividends & Distributable Reserves

  • Concept of Entry and Exit Load and its impact on NAV

  • Key Accounting and Reporting Requirements

  • NAV, Total expense ratio and pricing of units for the Segregated Portfolio

CHAPTER :8 TAXATION
  • Applicability of taxes in respect of mutual funds

  • Capital Gains

  • Dividend income

  • Stamp Duty on Mutual Fund Units

  • Setting off of Capital Gains and Losses under Income Tax Act

  • Securities Transaction Tax

  • Tax benefit under Section 80C of the Income Tax Act

  • Tax Deducted at Source

  • Applicability of GST

CHAPTER 9: INVESTOR SERVICES
  • The NFO process

  • New Fund Offer Price/On-going Offer Price for subscription

  • Investment Plans and Services

  • Allotment of Units to the Investor

  • Account statements for investments

  • Mutual Fund Investors

  • Filling the Application Form for Mutual Funds

  • Financial Transactions with Mutual Funds

  • Cut-off Time and Time Stamping

  • KYC Requirements for Mutual Fund Investors

  • Systematic Transactions

  • Operational aspects of Systematic Transactions

  • Non-Financial Transactions in Mutual Funds

  • Change in Status of Special Investor Categories

  • Investor transactions – turnaround times

CHAPTER 10: RISK, RETURN AND PERFORMANCE OF FUNDS
  • General and Specific Risk Factors

  • Factors that affect mutual fund performance

  • Drivers of Returns and Risk in a Scheme

  • Measures of Returns

  • SEBI Norms regarding Representation of Returns by Mutual Funds in India

  • Risks in fund investing with a focus on investors

  • Measures of Risk

  • Certain Provisions with respect to Credit risk

CHAPTER 11: MUTUAL FUND SCHEME PERFORMANCE
  • Benchmarks and Performance

  • Price Return Index or Total Return Index

  • Basis of Choosing an appropriate performance benchmark

  • Benchmarks for equity schemes

  • Benchmarks for Debt Schemes

  • Benchmarks for Other Schemes

  • Quantitative Measures of Fund Manager Performance

  • Tracking Error

  • Scheme Performance Disclosure

CHAPTER 12: MUTUAL FUND SCHEME SELECTION
  • Scheme Selection based on Investor needs, preferences and risk-profile

  • Risk levels in mutual fund schemes

  • Scheme Selection based on investment strategy of mutual funds

  • Selection of Mutual Fund scheme offered by different AMCs or within the scheme category

  • Selecting options in mutual fund schemes

  • Do’s and Don’ts while selecting mutual fund schemes

APPENDIX

ANNEXURES & FORMS


REGISTRATION & ENROLMENT PROCESS

Now that you know about the syllabus and pattern of the NISM V-A Examination, it’s time to see the enrolment process.

Follow these simple guidelines to register and appear for your NISM V-A exam:

STEP.1:

For registration, fill the required details, and attach the following: a passport-size photo, soft-copy of PAN card, and valid proof of address. Verify your details before clicking the submit option.

STEP.2:

Upon completion, you will receive the NISM registration number and an account activation link to your registered e-mail addresses. Activate your NISM account by clicking on the link.

STEP.3:

You can now successfully log in to your NISM account and proceed to register for the examination by clicking on the “enrolment for examination” on the profile page.

STEP.4:

Next, select the city and desired examination center to check seat availability.

STEP.5:

After selecting the desired location, seat, and time slot, proceed to make payment of fees through the chosen payment gateway. The NISM V-A exam fee is Rs.1500+GST. You will receive a confirmation through e-mail & SMS on making the payment.

STEP.6:

You can download the soft-copy of the study material or workbook on successful registration on the NISM website. There is also an option to purchase a hard copy of the same.

This workbook is comprehensive and covers the whole syllabus of the exam.

STEP.7:

Do not forget to carry the following on the day of your exam:

  • Printout of Admit Card downloaded from the NISM account enrolment tab

  • Copy of any valid identity proof

The invigilator shall allow candidates to appear for the exam post verification of the same.


SOME TIPS & TRICKS TO ACE YOUR NISM V-A EXAM

Get ready to prepare and ace your NISM V-A exam. Here are some essential tips to guide you in your preparation.

  1. One mistake any examination candidate will make is getting confused between multiple versions of online and offline study materials. Candidates appearing for the NISM V-A examination can eliminate this chaos as the official workbook provided by the NISM website is more than sufficient.

  2. The next crucial step is planning and practice. Create and follow an effective study plan to cover each lesson/topic. Keep practicing the challenging concepts. Stay consistent and focused in your preparation.

  3. During the exam, plan your time sufficiently to attempt the full 100 marks in 2 hours. Attempt the easy questions first to get more time to solve the tougher ones.

  4. NISM offers mock tests that have helped candidates prepare for their NISM V-A Certification Examination. These mock tests not only aid in measuring the preparation level but also make candidates familiar with the exam pattern, thereby reducing anxiety on exam day. Click here to give a try of the mock tests.

Click here to receive more expert tips and guidance.


RESULTS AND REVALUATION

The results of the NISM V-A examination will be displayed on the screen immediately upon completion. The exam is assessed electronically to avoid possible human error and intervention, so revaluation of scores is not permitted. NISM also does not allow the disclosure of questions asked in the exam to maintain the confidentiality of the program.


Upon successful completion of the examination and announcement of results, a Digital Certificate will be displayed and mailed to the candidate, who will also be notified via email & SMS.


IMPORTANT NOTE

Individuals must possess a valid PAN card, the details of which must be submitted either while registering for the examination or before the receipt of NISM certification. The NISM V-A Certificate is awarded to qualified candidates only when valid PAN Card details are submitted.


VALIDITY OF THE NISM V-A CERTIFICATE

The NISM Certification is valid for three years from the issue date (or the exam date). Candidates must complete the Continuing Professional Education (CPE) program or successfully pass another NISM V-A exam for renewing the validity of the NISM Certification.


BONUS POINT

Now that you know all about the NISM Series V-A Certificate, including tips to ace the examination, know the next steps after qualifying and receiving the NISM V-A Certificate. The NISM V-A certificate allows you to register with the Association of Mutual Funds in India (AMFI) as a Mutual Fund Distributor (MFD). The next step is to commence your business by empaneling with the Asset Management Companies (AMC) and approaching potential investors. But do you know? There are 45+ AMCs in India with over 3000 active mutual funds schemes. Choosing which AMC to empanel and to handle the hundreds of client investments between different funds can be daunting.


We have got you covered. AssetPlus is the right place to empanel with not just a few but all the 45+ AMCs and to start your distributor business in the most convenient way. What is the benefit? It's an entirely online platform for managing your business combined with expert personnel to guide you during times of doubt. Register with your ARN to onboard new & existing clients hassle-free and take your business to the epitome of success.

In addition, you get complete support from qualified and trusted professionals to manage compliance and grievance issues, to build and promote your business through business development guidance and co-branded marketing materials. Also, stay updated on the latest market information and trends through our comprehensive research materials.

It’s time to become an MFDs expert in the field of mutual funds & help investors by becoming their trusted investment advisor. Start your business today. To know more, click here to WhatsApp us.

FREQUENTLY ASKED QUESTIONS FOR MUTUAL FUNDS DISTRIBUTOR :

What is the passing score for the NISM V-A Certification exam?

The passing score for the NISM V-A Certification exam is 50%. This means you need to correctly answer at least 50 out of 100 questions to pass the exam.

How long is the NISM V-A Certification valid for?

Can I retake the NISM V-A Certification exam if I fail?

Is there a specific time frame within which I need to complete the NISM V-A Certification exam?

Can I request for special accommodations or support during the NISM V-A Certification exam?

Can I apply for the NISM V-A Certification exam if I am not an Indian citizen?

Are there any prerequisites or prior certifications required to appear for the NISM V-A Certification exam?

Can I reschedule my NISM V-A Certification exam if I am unable to attend the originally scheduled date?

Can I use a calculator during the NISM V-A Certification exam?

How long does it take to receive the NISM V-A Certification exam results?



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