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NISM NISM-Series-VII Exam Syllabus Topics:

SectionWeightObjectives
Investor Protection7%- Investor rights and grievances redressal
- Mechanisms for dispute resolution
- Investor education and awareness initiatives
Market Microstructure12%- Market indices and their calculation
- Price discovery and market efficiency
- Trading mechanisms and order types
Securities Market Overview10%- Structure and segments of Indian securities market
- Types of securities and products
- Market participants and their roles
Technology in Securities Markets8%- Emerging technologies and their impact
- Systems for trading, clearing and settlement
- Data security and business continuity
Regulatory Framework15%- Compliance requirements for intermediaries
- Code of conduct and ethical practices
- SEBI Act, Rules and Regulations
Clearing and Settlement15%- Settlement cycle and mechanisms
- Clearing process and roles of clearing corporations
- Delivery versus payment and settlement guarantee
Trading Operations15%- Front office functions and processes
- Client onboarding and KYC norms
- Order management and trade execution
Risk Management and Margining18%- Risk monitoring and control measures
- Types of risks in securities operations
- Margining systems and methodologies

NISM Series VII - Securities Operations and Risk Management Certification Sample Questions:

Question #1

In the context of the operations of a Depository Participant (DP), what is identified as the 'main activity' pursuant to the trading activity of an investor?

  • A. Receiving non-cash corporate benefits like bonus shares
  • B. Settlement and transfer of securities from one beneficiary account to another
  • C. Pledging of dematerialized securities
  • D. Freezing of the demat account for debits or credits
  • E. Dematerialization of physical securities
Reveal Solution  Discussion  0

Correct Answer: B  🗳️

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Question #2

The 'Direct Listing of Equity Shares of Companies Incorporated in India on International Exchanges Scheme' is specified under which schedule of the Foreign Exchange Management (Non-debt Instruments) Rules, 2019?

  • A. Schedule XI
  • B. Schedule X
  • C. Schedule V
  • D. Schedule I
  • E. Schedule VII
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Correct Answer: A  🗳️

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Question #3

For the purpose of identifying an 'extra-ordinary' dividend (which triggers adjustment in Equity F&O), the declared dividend must be at and above 2% of the market value of the underlying stock. How is this 'market price' specifically defined for the calculation?

  • A. The closing price of the scrip on the day previous to the date on which the announcement of the dividend is made by the Company after the Board meeting.
  • B. The closing price of the scrip on the record date fixed for the purpose of dividend payment.
  • C. The closing price of the scrip on the date of the Annual General Meeting (AGM) where the dividend is approved.
  • D. The average closing price of the scrip for the last 5 trading days prior to the record date.
  • E. The volume-weighted average price (VWAP) of the scrip on the cum-dividend date.
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Correct Answer: A  🗳️

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Question #4

Stock Exchanges are required to maintain an Investor Services Fund (ISF) distinct from the Investor Protection Fund (IPF). What is the specific contribution requirement from the Stock Exchange towards the ISF?

  • A. At least 20% of the listing fees received.
  • B. 1% of the listing fees received, on a quarterly basis.
  • C. 5% of the transaction charges collected from members.
  • D. 100% of the interest earned on the 1% security deposit of issuer companies.
  • E. The penalty collected for client code modification.
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Correct Answer: A  🗳️

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Question #5

Clearing Corporations are required to conduct various tests to ensure the adequacy of the Core SGF. What is the specific purpose of the 'Reverse Stress Test' as defined in the risk management framework?

  • A. To calculate the historical volatility of the most liquid securities over the past 5 years.
  • B. To test the operational capability of the backup disaster recovery site.
  • C. To determine the daily settlement price of illiquid futures contracts.
  • D. To validate the accuracy of the software used for margin calculation.
  • E. To identify under which market conditions and scenarios the combination of margins, Core SGF, and other financial resources would prove insufficient.
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Correct Answer: E  🗳️

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