NISM V-A Certification: Become a Mutual Fund Distributor
Updated: Sep 13
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!
OBJECTIVES OF NISM V-A EXAMINATION
The NISM Series V-A Certification aims to make candidates:
Know the basics of mutual funds, including their features, structure, and various mutual fund schemes.
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.
Become familiar with the legal, accounting, valuation, and taxation aspects of mutual funds and their distribution.
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.
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.
The mutual fund advisor exam pattern comprises 100 multiple choice questions for 100 marks, and the duration is 2 hours (120 minutes).
The minimum pass mark is 50%, with no negative marking for incorrect answers.
The candidate must pay an amount of Rs.1,500+GST to register for the NISM V-A exam.
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: LEGLA 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.
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.
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.
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.
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.
https://www.partners.assetplus.in/
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?
The NISM V-A Certification is valid for a period of three years from the date of the certification exam.
Can I retake the NISM V-A Certification exam if I fail?
Yes, you can retake the NISM V-A Certification exam if you fail. There is no restriction on the number of attempts. However, you will need to register again and pay the exam fee for each attempt. You can also reappear for the exam immediately. There is no waiting period or restriction on the number of attempts.
Is there a specific time frame within which I need to complete the NISM V-A Certification exam?
Yes, there is a specific time frame within which you need to complete the NISM V-A Certification exam. The exam needs to be taken within 6 months from the date of registration.
Can I request for special accommodations or support during the NISM V-A Certification exam?
Yes, you can request for special accommodations or support during the NISM V-A Certification exam. You need to contact the NISM helpdesk or the test center to make arrangements in advance.
Can I apply for the NISM V-A Certification exam if I am not an Indian citizen?
Yes, non-Indian citizens are eligible to apply for the NISM V-A Certification exam. The certification is open to individuals irrespective of their citizenship.
Are there any prerequisites or prior certifications required to appear for the NISM V-A Certification exam?
No, there are no prerequisites or prior certifications required to appear for the NISM V-A Certification exam. It is open to all individuals who have completed 18 years of age.
Can I reschedule my NISM V-A Certification exam if I am unable to attend the originally scheduled date?
Yes, you can reschedule your NISM V-A Certification exam if you are unable to attend the originally scheduled date. You need to contact the NISM helpdesk or the test center to make arrangements for rescheduling.
Can I use a calculator during the NISM V-A Certification exam?
No, the use of calculators or any electronic devices is not allowed during the NISM V-A Certification exam. Candidates are expected to rely on their knowledge and skills to answer the exam questions.
How long does it take to receive the NISM V-A Certification exam results?
The duration to receive the NISM V-A Certification exam results may vary. Generally, it takes around 7-10 business days from the date of the exam to receive the results. The results are communicated through email or can be checked on the NISM website.