NISM Series-V-B: Mutual Fund Foundation

The NISM Series-V-B: Mutual Fund Foundation Certification exam, main aim is to create common minimum knowledge benchmark for a new cadre of mutual fund distributors, as per SEBI circular CIR/IMD/DF/21/2012 dated September 13, 2012. This exam is specially intended for candidates that are involved in selling and distributing simple and performing mutual fund schemes. The certification aims to enhance the quality of sales, distribution and related support services in the mutual fund industry.

Exam Details

The examination name is NISM-Series-V-B: Mutual Fund Foundation Certification Examination. The number of questions asked in the exam is 50 of 1 mark each and should be completed in 2 hours. Moreover, maximum marks obtained in this exam is 50 with a passing score of 50%. There shall be no negative marking for an incorrect answer. Also, this certification is valid for next 3 years from the date of the issue of the certificate. The examination fee is Rs. 1200+. Moreover, passing certificate will be issued only to those candidates who have furnished / updated their Income Tax Permanent Account Number (PAN) in their registration details.

Target Audience

The target audience for Mutual Fund Foundation examination is:

• Retired bank officers with a service of at least 10 years, and other similar persons (such as Bank correspondents) as may be notified by AMFI/AMC from time to time
• Postal agents
• Retired government and semi-government officials (class III and above or equivalent) with a service of at least 10 years
• Retired teachers with a service of at least 10 years

Learning Objectives

On successful completion of the Mutual Fund Foundation examination, the candidate should:

• Know the basics of mutual funds, their role and structure, different kinds of mutual fund schemes and their features.
• Know how mutual funds are distributed in the market-place, how specified schemes are to be evaluated and how suitable schemes can be recommended by this cadre of distributors to prospective investors.
• How the rules and regulations related to the distribution of specified products.
• Know the basics of financial planning as an approach to investing in mutual funds.

Schedule your exam

Follow some tips to schedule your R&T exam:

• Firstly, You should register yourself with NISM Certifications Registration Portal.
• Secondly, if you are a new candidate, please click on “Register” for fresh one-time registration. If you are already registered with NISM Portal, please use your Email address and Password to login.
• Follow there steps after logging in:
  • Check Seat Availability
  • Schedule a Test / Enroll Online
  • Make Payment using Credit Card / Debit Card/ Net Banking
  • Take Practice Exams
  • Download Admit Card / Study Material (after enrollment)
  • Access Exam Results and Verify Skills
  • Check Special Accommodation policy form
• Thirdly, candidates can register themselves online by filling the Candidate Registration Form.
• Lastly, NISM also provides its pdf for Registration Guidelines for filling the online registration form.

Refund and Rescheduling Policy

Fees once paid shall not be refunded except under following circumstances:

• Candidate’s account /card was debited but the enrollment was not successful
• In case of multiple deduction of fees from candidate’s account
• In case NISM or test administrator is not able to offer examination/ CPE program / e CPE program for any technical reason and rescheduling is not suitable to a candidate

A candidate may be offered rescheduling of an examination subject to availability of slots only in certain cases such as:

• Significant / prolonged disruption of internet / power at the test center
• Non-availability of NISM’s examination application due to scheduled or unscheduled maintenance
• Inability of NISM or test administrator to conduct examination/s because of circumstances like natural disasters, law and order situation etc.

For More: Check NISM Series-V-B: Mutual Fund Foundation FAQs

Course Outline

The NISM Series-V-B: Mutual Fund Foundation Certification exam mentions the below course outline:

• Investment Landscape
  • Introduction to Savings and Investment
  • Different asset classes
  • Four broad financial needs
  • Different types of financial goals
  • Role of Mutual Fund in achieving different financial goals
• Concept and Role of a Mutual Fund
  • Explain the concept of mutual fund
  • Understand the classifications of mutual funds
  • Describe the Growth of the mutual fund industry in India
• Legal Structure of Mutual Funds in India
  • Describe the structure of mutual funds in India
  • Understand the key constituents of a Mutual Funds
  • Explain the Role and Function of AMFI
  • Understand the organization structure of Asset Management Company
  • Understand the role and support functions of service providers of mutual funds
• Mutual Fund Products for the new Cadre of Distributors
  • Introduction to Mutual Fund Products for New Cadre of Distributors
  • Liquid Schemes / Money Market Schemes
  • Index Funds
  • Diversified Equity Schemes
  • Retirement Benefit Schemes
  • Fixed Maturity Plans (FMPs)
• Scheme related Information
  • Understanding the Mandatory Documents and their purpose, objective and significance
  • Explain the Non-Mandatory Disclosures
• Fund Distribution and Channel Management Practices
  • Explain the role and importance of mutual fund distributors
  • Understand the classification of mutual fund distributors
  • Explain the modes of distribution
  • Understand the Pre-requisites to become Distributor of the Mutual Fund
  • Explain Revenue for a mutual fund distributor
  • Know the Commission Disclosure mandated by SEBI
  • Explain the Due Diligence Process by AMCs for Distributors of Mutual Funds
  • Explain about change of distributor
• Performance of Mutual Funds
  • Understand the calculation of returns of mutual fund schemes
  • Understand the concepts of Loads and the application of Exit Load in calculating the transaction Price
  • Know the concept of risk in a mutual fund investment-General and Specific risk factors
  • Understand the concept of risk adjusted return
  • Understand the concept of scheme benchmark for mutual fund schemes
• Taxation
  • Understand Applicability of various taxes in respect of mutual funds.
  • Understand about Capital gains (Long term & Short term tax) and Indexation.
  • Know about the Dividend Income and Dividend Income tax.
  • Moreover, understand the basics of Setting off Gains and Losses under Income Tax Act.
• Investors Services
  • Describe the NFO Process
  • Discuss Different types of investment plans and options
  • Explain how the mutual fund units are allotted to the investor
  • Describe the account statements
  • Describe different types of Mutual Fund Investors
  • Explain how to fill in the application form for mutual funds
  • Describe the financial transactions with mutual funds
  • Explain Cut-off time and Time Stamping
  • Describe the KYC requirement for mutual fund investors
  • Explain the different types of systematic transactions
  • Explain operational aspects of systematic transaction
  • Moreover, investor Transactions – turnaround times
• Legal and Regulatory Framework
  • Discuss role of Securities and Exchange Board of India
  • Explain Investor Grievance and Redressal standards
  • Henceforth, understand AMFI Code of conduct for Intermediaries

NISM Series-V-B: Mutual Fund Foundation Study Guide

Candidates should be very dedicated while preparing for this exam. Moreover, choosing the right resources to study is also important. There are numerous resources available online but we need to figure out the ones which are beneficial for us. This will help in managing your time and you can devote more time to practice tests and revision. Therefore, let us look some handful resources that will help you ace your exam.

Getting familiar with Course Outline

• Investment Landscape
• Concept and Role of a Mutual Fund
• Legal Structure of Mutual Funds in India
• Mutual Fund Products for the new Cadre of Distributors
• Scheme related Information
• Fund Distribution and Channel Management Practices
• Performance of Mutual Funds
• Taxation
• Investors Services
• Legal and Regulatory Framework

Study Resources

• Practice exams: The NISE provides its candidates with online free practice test on its official website. Candidates who aspire to qualify this exam must look at this useful resource.
• Buy Workbooks: Candidate can buy NISM workbooks online through Taxmann Publications Private Ltd.
• Online Training Program: NISM conducts Investor Education programs for different Government Institutions/ Law enforcement agencies / Private and Public organizations and colleges across the country.
• NISM YouTube Videos: Candidates can find videos on NISM YouTube channel for their respective course. Moreover, these are free of cost and candidates can go for them as well.

Moreover, keep yourself updated with the upcoming events on NISM official website.

Join Online Study Groups

Joining online study groups is the most appropriate way to improve your examination skills and understanding things in a better way. Since, study groups provides you with a platform to discuss and clear your doubts in the best possible way with the help of professionals. Moreover, joining study groups helps in keeping you updated with any recent modifications or any changes in the examination. Therefore, joining online study groups is the best option.

Take Practice tests

While preparing for any examination the most important step is to take NISM Series-V-B: Mutual Fund Foundation practice tests. These tests do not only help you to check your preparation level, build your confidence and time management but also help you to get familiar with different types of questions that are frequently asked in the examination. Moreover, the NISM-Series-V-B: Mutual Fund Foundation practice test consists of questions from basic to advanced level in a systemized manner. Therefore, take maximum number of practice tests.