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Series V-A · Exam Focus

NISM Series V-A: Mutual Fund Distributors Certification — Exam Focus Practice Questions

Exam-specific finance and market-practice questions for NISM Series V-A: Mutual Fund Distributors Certification. Every question below shows the correct answer and a full explanation, so you can read through this set as a study page or attempt it as a timed mock test.

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Practice questions

All 25 questions in Exam Focus

Read each question, think through your answer, then expand it to check the correct option and explanation.

NAV Calculation

Q1. A mutual fund scheme has assets worth Rs. 125 crore, liabilities of Rs. 5 crore, and 12 crore units outstanding. What is the NAV per unit?

  1. A. Rs. 10
  2. B. Rs. 12
  3. C. Rs. 15
  4. D. Rs. 100
Show correct answer & explanation

Correct answer: A. Rs. 10

Net assets are Rs. 120 crore. Dividing by 12 crore units gives NAV of Rs. 10 per unit.
SIP

Q2. Which statement best describes rupee-cost averaging in a SIP?

  1. A. More units are bought when NAV is low and fewer units when NAV is high
  2. B. Same number of units is bought every month
  3. C. SIP guarantees profit
  4. D. SIP removes market risk completely
Show correct answer & explanation

Correct answer: A. More units are bought when NAV is low and fewer units when NAV is high

A fixed investment amount buys more units at lower NAVs and fewer units at higher NAVs.
Loads and Expenses

Q3. Entry load on mutual fund purchases in India is currently:

  1. A. Allowed up to 2.25%
  2. B. Banned for mutual fund schemes
  3. C. Charged only for ELSS
  4. D. Paid directly to AMFI
Show correct answer & explanation

Correct answer: B. Banned for mutual fund schemes

Entry load was abolished to improve transparency for investors.
Taxation

Q4. Equity-oriented mutual fund units held for more than 12 months are generally treated as:

  1. A. Short-term capital assets
  2. B. Long-term capital assets
  3. C. Business inventory only
  4. D. Tax-free in all cases
Show correct answer & explanation

Correct answer: B. Long-term capital assets

For equity-oriented mutual funds, a holding period beyond 12 months generally makes gains long-term capital gains.
Investor Suitability

Q5. A retired investor needs stable monthly cash flow and low volatility. Which factor should a distributor consider first?

  1. A. Suitability and risk profile
  2. B. Highest recent return
  3. C. Highest exit load
  4. D. Most complex product
Show correct answer & explanation

Correct answer: A. Suitability and risk profile

Suitability must consider risk profile, liquidity, income needs, time horizon, and product features.
Scheme Types

Q6. An open-ended mutual fund scheme allows investors to:

  1. A. Buy and redeem units continuously at NAV-linked prices
  2. B. Trade only on the listing day
  3. C. Redeem only at maturity
  4. D. Invest only through IPO bidding
Show correct answer & explanation

Correct answer: A. Buy and redeem units continuously at NAV-linked prices

Open-ended schemes allow ongoing purchase and redemption subject to scheme rules.
ELSS

Q7. What is a key feature of ELSS funds?

  1. A. They have a statutory lock-in period
  2. B. They never invest in equities
  3. C. They are always debt funds
  4. D. They have no tax relevance
Show correct answer & explanation

Correct answer: A. They have a statutory lock-in period

ELSS funds are equity-linked savings schemes with a lock-in period and tax-related features.
AMFI

Q8. What is the role of AMFI in the mutual fund industry?

  1. A. Industry association for mutual funds
  2. B. Primary regulator replacing SEBI
  3. C. Depository for units
  4. D. Credit rating agency
Show correct answer & explanation

Correct answer: A. Industry association for mutual funds

AMFI is the industry association; SEBI remains the regulator for mutual funds.
Riskometer

Q9. The mutual fund riskometer is mainly used to communicate:

  1. A. Scheme risk level to investors
  2. B. Guaranteed return
  3. C. Exit load slab only
  4. D. Distributor commission
Show correct answer & explanation

Correct answer: A. Scheme risk level to investors

The riskometer helps investors understand the broad risk level of a scheme.
Direct and Regular Plans

Q10. Compared with a regular plan, a direct plan usually has:

  1. A. Lower expense ratio
  2. B. Higher distributor commission
  3. C. Mandatory advisory fee
  4. D. No NAV disclosure
Show correct answer & explanation

Correct answer: A. Lower expense ratio

Direct plans do not include distributor commission in the same way regular plans do, so expense ratios are typically lower.
Taxation basics

Q11. In Series V-A Exam Focus, a learner wants to improve accuracy in Taxation basics. Which study action is most useful?

  1. A. Review the concept, read explanations, and practise similar questions
  2. B. Memorise only the previous option letter
  3. C. Skip the topic because it appeared difficult
  4. D. Attempt faster without checking why answers were wrong
Show correct answer & explanation

Correct answer: A. Review the concept, read explanations, and practise similar questions

Accuracy improves when the learner connects the concept, the explanation, and repeated practice on the same weak area.
NAV and valuation

Q12. In Series V-A Exam Focus, a learner wants to improve accuracy in NAV and valuation. Which study action is most useful?

  1. A. Review the concept, read explanations, and practise similar questions
  2. B. Memorise only the previous option letter
  3. C. Skip the topic because it appeared difficult
  4. D. Attempt faster without checking why answers were wrong
Show correct answer & explanation

Correct answer: A. Review the concept, read explanations, and practise similar questions

Accuracy improves when the learner connects the concept, the explanation, and repeated practice on the same weak area.
Distribution process

Q13. In Series V-A Exam Focus, a learner wants to improve accuracy in Distribution process. Which study action is most useful?

  1. A. Review the concept, read explanations, and practise similar questions
  2. B. Memorise only the previous option letter
  3. C. Skip the topic because it appeared difficult
  4. D. Attempt faster without checking why answers were wrong
Show correct answer & explanation

Correct answer: A. Review the concept, read explanations, and practise similar questions

Accuracy improves when the learner connects the concept, the explanation, and repeated practice on the same weak area.
Taxation basics

Q14. In Series V-A Exam Focus, a learner wants to improve accuracy in Taxation basics. Which study action is most useful?

  1. A. Review the concept, read explanations, and practise similar questions
  2. B. Memorise only the previous option letter
  3. C. Skip the topic because it appeared difficult
  4. D. Attempt faster without checking why answers were wrong
Show correct answer & explanation

Correct answer: A. Review the concept, read explanations, and practise similar questions

Accuracy improves when the learner connects the concept, the explanation, and repeated practice on the same weak area.
NAV and valuation

Q15. In Series V-A Exam Focus, a learner wants to improve accuracy in NAV and valuation. Which study action is most useful?

  1. A. Review the concept, read explanations, and practise similar questions
  2. B. Memorise only the previous option letter
  3. C. Skip the topic because it appeared difficult
  4. D. Attempt faster without checking why answers were wrong
Show correct answer & explanation

Correct answer: A. Review the concept, read explanations, and practise similar questions

Accuracy improves when the learner connects the concept, the explanation, and repeated practice on the same weak area.
Distribution process

Q16. In Series V-A Exam Focus, a learner wants to improve accuracy in Distribution process. Which study action is most useful?

  1. A. Review the concept, read explanations, and practise similar questions
  2. B. Memorise only the previous option letter
  3. C. Skip the topic because it appeared difficult
  4. D. Attempt faster without checking why answers were wrong
Show correct answer & explanation

Correct answer: A. Review the concept, read explanations, and practise similar questions

Accuracy improves when the learner connects the concept, the explanation, and repeated practice on the same weak area.
Taxation basics

Q17. In Series V-A Exam Focus, a learner wants to improve accuracy in Taxation basics. Which study action is most useful?

  1. A. Review the concept, read explanations, and practise similar questions
  2. B. Memorise only the previous option letter
  3. C. Skip the topic because it appeared difficult
  4. D. Attempt faster without checking why answers were wrong
Show correct answer & explanation

Correct answer: A. Review the concept, read explanations, and practise similar questions

Accuracy improves when the learner connects the concept, the explanation, and repeated practice on the same weak area.
NAV and valuation

Q18. In Series V-A Exam Focus, a learner wants to improve accuracy in NAV and valuation. Which study action is most useful?

  1. A. Review the concept, read explanations, and practise similar questions
  2. B. Memorise only the previous option letter
  3. C. Skip the topic because it appeared difficult
  4. D. Attempt faster without checking why answers were wrong
Show correct answer & explanation

Correct answer: A. Review the concept, read explanations, and practise similar questions

Accuracy improves when the learner connects the concept, the explanation, and repeated practice on the same weak area.
Distribution process

Q19. In Series V-A Exam Focus, a learner wants to improve accuracy in Distribution process. Which study action is most useful?

  1. A. Review the concept, read explanations, and practise similar questions
  2. B. Memorise only the previous option letter
  3. C. Skip the topic because it appeared difficult
  4. D. Attempt faster without checking why answers were wrong
Show correct answer & explanation

Correct answer: A. Review the concept, read explanations, and practise similar questions

Accuracy improves when the learner connects the concept, the explanation, and repeated practice on the same weak area.
Taxation basics

Q20. In Series V-A Exam Focus, a learner wants to improve accuracy in Taxation basics. Which study action is most useful?

  1. A. Review the concept, read explanations, and practise similar questions
  2. B. Memorise only the previous option letter
  3. C. Skip the topic because it appeared difficult
  4. D. Attempt faster without checking why answers were wrong
Show correct answer & explanation

Correct answer: A. Review the concept, read explanations, and practise similar questions

Accuracy improves when the learner connects the concept, the explanation, and repeated practice on the same weak area.
NAV and valuation

Q21. In Series V-A Exam Focus, a learner wants to improve accuracy in NAV and valuation. Which study action is most useful?

  1. A. Review the concept, read explanations, and practise similar questions
  2. B. Memorise only the previous option letter
  3. C. Skip the topic because it appeared difficult
  4. D. Attempt faster without checking why answers were wrong
Show correct answer & explanation

Correct answer: A. Review the concept, read explanations, and practise similar questions

Accuracy improves when the learner connects the concept, the explanation, and repeated practice on the same weak area.
Distribution process

Q22. In Series V-A Exam Focus, a learner wants to improve accuracy in Distribution process. Which study action is most useful?

  1. A. Review the concept, read explanations, and practise similar questions
  2. B. Memorise only the previous option letter
  3. C. Skip the topic because it appeared difficult
  4. D. Attempt faster without checking why answers were wrong
Show correct answer & explanation

Correct answer: A. Review the concept, read explanations, and practise similar questions

Accuracy improves when the learner connects the concept, the explanation, and repeated practice on the same weak area.
Taxation basics

Q23. In Series V-A Exam Focus, a learner wants to improve accuracy in Taxation basics. Which study action is most useful?

  1. A. Review the concept, read explanations, and practise similar questions
  2. B. Memorise only the previous option letter
  3. C. Skip the topic because it appeared difficult
  4. D. Attempt faster without checking why answers were wrong
Show correct answer & explanation

Correct answer: A. Review the concept, read explanations, and practise similar questions

Accuracy improves when the learner connects the concept, the explanation, and repeated practice on the same weak area.
NAV and valuation

Q24. In Series V-A Exam Focus, a learner wants to improve accuracy in NAV and valuation. Which study action is most useful?

  1. A. Review the concept, read explanations, and practise similar questions
  2. B. Memorise only the previous option letter
  3. C. Skip the topic because it appeared difficult
  4. D. Attempt faster without checking why answers were wrong
Show correct answer & explanation

Correct answer: A. Review the concept, read explanations, and practise similar questions

Accuracy improves when the learner connects the concept, the explanation, and repeated practice on the same weak area.
Distribution process

Q25. In Series V-A Exam Focus, a learner wants to improve accuracy in Distribution process. Which study action is most useful?

  1. A. Review the concept, read explanations, and practise similar questions
  2. B. Memorise only the previous option letter
  3. C. Skip the topic because it appeared difficult
  4. D. Attempt faster without checking why answers were wrong
Show correct answer & explanation

Correct answer: A. Review the concept, read explanations, and practise similar questions

Accuracy improves when the learner connects the concept, the explanation, and repeated practice on the same weak area.

How to use this set

Work through the questions in order without expanding the answers first, exactly as you would in the real Series V-A exam. Once you have picked an option, expand the answer to confirm whether you were right and read the explanation, even for questions you answered correctly, since the reasoning behind each option is where most of the learning happens.

If you get a question wrong, note the topic tag above the question and revisit that topic in the Series V-A exam page before your next attempt. When you are ready for exam-condition practice, use the timed mock test above; it shuffles these questions, applies the negative marking rule, and gives you a scored review at the end.