NISM-Series-XI: Equity Sales Certification Examination

Test Objectives

Unit 1: Overview of Indian Securities Markets

1.1 Know about the Indian Securities Markets

1.1.1 Discuss the structure of the Indian Securities Market

1.1.2 Discuss the role of the securities markets in the Indian economy

1.2 List the Market Regulators and understand their roles

1.3 Know the Products offered in the Indian Securities Markets

1.4 Know the Market Participants in the Indian Securities Market

List the Types of Investors


Unit 2: Regulatory Framework

2.1 Know the Securities Contracts (Regulation) Act, 1956 and explain how SC(R)A aims at preventing undesirable transactions in securities

2.2 Know the Securities Contracts (Regulation) Rules, 1957 and explain the rules for a contract in equity market between two members of recognised stock exchange

2.3 Understand the Securities and Exchange Board of India Act, 1992 and explain the Role of SEBI as a regulator

2.4 Understand the SEBI (Stock Brokers & Sub-brokers) Regulations, 2008 and know the rules and regulations to be followed by Stock Brokers and Sub-brokers

2.5 Understand the SEBI (Prohibition of Insider Trading) Regulations, 1992)

2.6 Understand the SEBI (Prohibition of Fraudulent and unfair trade practices relating to Securities Markets) Regulation, 2003

2.7 Understand the Depositories Act, 1996 and know various regulations on depositories of securities

2.8 Understand the Companies Act and know various features followed by a listed company

2.9 Understand the Prevention of Money Laundering Act, 2002 and know the regulations designed to prevent money laundering activities in the equity market

2.10 List and illustrate the various code of ethics followed by stock exchanges and SEBI’s code of conduct for brokers/sub-brokers


Unit 3: Primary Markets

3.1 Define the role of the primary market

3.2 List and describe various methods of issue of shares

3.2.1 Describe the IPO Process

3.2.2 Understand the intermediaries involved in IPO

3.2.3 Describe the FPO Process

3.2.4 Describe the Rights and preferential issues Process

3.2.5 Know about the QIP Process

3.2.6 Know about the private placement process

3.2.7 Define ADRS, GDRs, IDRs and FCCBs and know the process of their issue

3.3 Understanding the process of a public issue (Book built and Fixed price

3.4 Explain the various terminologies used in the primary market


Unit 4: Secondary Markets

4.1 Define the role of secondary market

4.2 Explain the role of stock exchanges in the trading mechanism

4.3 Describe the various phases in equity market (bull and bear phase) and related investment strategies


Unit 5: Understanding Market Indicators

5.1 Explain the term index

5.1.1 Understand the importance of index while investing

5.1.2 Understand the economic significance of index movement

5.1.3 Know Attributes of an index

5.1.4 Calculate Total Returns Index

5.2 List various types of indices

5.3 List Major Indices in India

5.4 Define and Calculate Beta

5.5 Define Impact Cost

5.6 Understand market capitalization

5.6.1 Define Market Capitalization

5.6.2 Define and Calculate Market Capitalization Ratio

5.6.3 Explain the significance of Market Capitalization Ratio as a market indicator

5.7 Understand Turnover and Turnover Ratio

5.7.1 Define Turnover

5.7.2 Define and Calculate Turnover Ratio

5.7.3 Explain the significance of Turnover Ratio as a market indicator

5.8 Know the basics of fundamental analysis

5.9 Know the basics of technical analysis


Unit 6: Trading and Risk Management

6.1 Know the role of a Trading Member

6.2 Understand the trading systems in India

6.3 Explain various types of orders

6.4 Understand the Trade Life cycle

6.5 Understand the mechanism of market wide circuit breakers and also Price Band

6.6 Know the transaction charges for securities transactions

6.7 Understand the capital adequacy requirements of trading members

6.8 Discuss the Risk Management mechanisms


Unit 7: Clearing and Settlement

7.1 List and explain different types of accounts

7.2 Explain the clearing process and describe the role of different agencies involved in the clearing and settlement process

7.3 Describe the netting of obligation


Unit 8: Surveillance, Investigation and Inspection

8.1 Explain the Importance of surveillance

8.2 Understand the market surveillance mechanism adopted by the equity exchanges and regulators


Unit 9: Client Management

9.1 Explain Risk versus Return

9.2 Understand various types of risks

9.3 Understand the importance of assessing the risk profile of investors

9.4 Understand basics of financial planning

9.5 Explain how to suggest suitable products to investors based on their risk appetite

9.6 Describe the process of review of customer’s portfolio from time to time

9.7 Know the process of Opening of Client Account for trading

9.8 Impact of taxation on equity investments

9.9 Know the investors’ grievance redressal mechanism and the SEBI’s SCORES system


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