Portfolio Management Services (PMS) Distributors

Syllabus and chapter weightage

Weightages are taken from the official syllabus table published in the NISM workbook, so you can see exactly where the marks are.

Every chapter can be read free, no account needed — tap a chapter to open its plain-English Foundation lesson.

Sample questions

5 questions from the chapter tests, one per chapter. Pick your answer before you open the explanation.

1. Question 1 · Chapter 1: Investments

   According to the workbook, which statement about savers and investors is correct?

   1. A.Every saver is an investor
   2. B.Every investor is a saver, but not vice versa
   3. C.Savers and investors always have the same goals
   4. D.Investors do not need to save first
   Show the answer

   Answer: B. Every investor is a saver, but not vice versa

   The workbook says those who save funds have the choice of investing — so every investor is a saver, but not vice versa.

   Option A reverses the relationship. Option C is wrong: savers tend to have short-term goals, investors longer-term ones. Option D is wrong because investment is the commitment of savings — there is nothing to invest until you have saved.

2. Question 2 · Chapter 2: Introduction to Securities Markets

   Which of the following is a function of the secondary market, as described in the workbook?

   1. A.Providing liquidity to investors for securities already issued
   2. B.Allowing issuers to raise fresh capital directly
   3. C.Deciding the eligibility criteria for IPOs
   4. D.Issuing bonus shares
   Show the answer

   Answer: A. Providing liquidity to investors for securities already issued

   The secondary market gives primary market investors a continuous market where they can liquidate or exit — which in turn promotes the primary market.

   Raising fresh capital is the primary market's job. IPO eligibility is set by SEBI. Bonus shares are issued by companies to existing shareholders.

3. Question 3 · Chapter 3: Investing in Stocks

   Which ratio compares the price of a stock to the earnings it generates?

   1. A.P/E ratio
   2. B.P/B ratio
   3. C.Price/Cash flow ratio
   4. D.Price/Sales ratio
   Show the answer

   Answer: A. P/E ratio

   The price-to-earnings (P/E) ratio is stock price divided by EPS.

   P/B compares price to book value. Price/Cash flow uses operating cash flow. P/S uses sales (revenue).

4. Question 4 · Chapter 4: Investing in Fixed Income Securities

   The feature that allows the issuing firm to retire bonds before maturity by paying a prescribed price is called:

   1. A.Callability (call option)
   2. B.Putability (put option)
   3. C.Convertibility
   4. D.Perpetuity
   Show the answer

   Answer: A. Callability (call option)

   A callable bond gives the issuer the right to redeem all or part of the bonds before maturity.

   A put gives the holder the right to sell back. Convertibility lets the holder exchange for shares. A perpetual bond has no maturity at all.

5. Question 5 · Chapter 5: Derivatives

   In a Nifty 50 futures contract, the underlying is:

   1. A.The top traded stocks of the Nifty 50 index
   2. B.The average price of the stocks of the Nifty 50 index
   3. C.The value of the Nifty 50 index
   4. D.All of the above
   Show the answer

   Answer: C. The value of the Nifty 50 index

   The SC(R)A includes a contract deriving its value from an index of prices of underlying securities. For Nifty futures, the underlying is the value of the Nifty 50 index itself.

   The index is not just the top traded stocks, and it is not a simple average of stock prices. So "all of the above" is also wrong.

Frequently asked questions

What is the passing mark for NISM Series XXI-A?

You need 60% to pass NISM-Series-XXI-A: Portfolio Management Services (PMS) Distributors. On a 100-mark paper that is 60 marks.

Is there negative marking in NISM Series XXI-A?

There is negative marking of 10% of the marks for that question, so a wrong answer costs you 0.10 marks on a 1-mark question. Guess only when you can eliminate at least two options.

How long is the NISM Series XXI-A exam?

The exam runs for 120 minutes and carries 100 marks in total.

How long is the NISM Series XXI-A certificate valid?

NISM certifications are generally valid for 3 years from the date of passing, after which they must be renewed. Confirm the current position on nism.ac.in before your certificate lapses.