Securities Market (Basic) Module

NATIONAL STOCK EXCHANGE OF INDIA LIMITED

Test Details:

Sr. No.

Name of Module Fees (Rs.)

Test Duration

(in minutes)

No. of Questions

Maximum Marks

Pass Marks (%)

Certifi cate Validity

(in years)

1 Financial Markets: A Beginners Module * 1500 120 60 100 50 52 Mutual Funds : A Beginners Module 1500 120 60 100 50 53 Currency Derivatives: A Beginners Module 1500 120 60 100 50 54 Equity Derivatives: A Beginners Module 1500 120 60 100 50 55 Interest Rate Derivatives: A Beginners

Module1500 120 60 100 50 5

6 Commercial Banking in India: A Beginners Module

1500 120 60 100 50 5

7 Securities Market (Basic) Module 1500 105 60 100 60 58 Capital Market (Dealers) Module * 1500 105 60 100 50 59 Derivatives Market (Dealers) Module * 1500 120 60 100 60 310 FIMMDA-NSE Debt Market (Basic) Module 1500 120 60 100 60 511 Investment Analysis and Portfolio

Management Module1500 120 60 100 60 5

12 NISM-Series-I: Currency Derivatives Certifi cation Examination

1000 120 60 100 60 3

13 NISM-Series-II-A: Registrars to an Issue and Share Transfer Agents Corporate Certifi cation Examination

1000 120 100 100 50 3

14 NISM-Series-II-B: Registrars to an Issue and Share Transfer Agents Mutual Fund Certifi cation Examination

1000 120 100 100 50 3

15 NISM-Series-IV: Interest Rate Derivatives Certifi cation Examination

1000 120 100 100 60 3

16 NISM-Series-V-A: Mutual Fund Distributors Certifi cation Examination *

1000 120 100 100 50 3

17 NISM-Series-VI: Depository Operations Certifi cation Examination

1000 120 100 100 60 3

18 NISM Series VII: Securities Operations and Risk Management Certifi cation Examination

1000 120 100 100 50 3

19 Certifi ed Personal Financial Advisor (CPFA) Examination

4000 120 80 100 60 3

20 NSDLDepository Operations Module 1500 75 60 100 60 # 521 Commodities Market Module 1800 120 60 100 50 322 Surveillance in Stock Exchanges Module 1500 120 50 100 60 523 Corporate Governance Module 1500 90 100 100 60 524 Compliance Offi cers (Brokers) Module 1500 120 60 100 60 525 Compliance Offi cers (Corporates) Module 1500 120 60 100 60 5

26

Information Security Auditors Module(Part-1)

2250 120 90 100 60

2Information Security Auditors Module(Part-2)

2250 120 90 100 60

27 Options Trading Strategies Module 1500 120 60 100 60 528 FPSB India Exam 1 to 4** 2000 per

exam120 75 140 60 NA

29 Examination 5/Advanced Financial Planning **

5000 240 30 100 50 NA

30 Equity Research Module ## 1500 120 65 100 55 231 Issue Management Module ## 1500 120 80 100 55 232 Market Risk Module ## 1500 120 50 100 55 233 Financial Modeling Module ### 1000 150 50 75 50 NA

* Candidates have the option to take the CMDM test in English, Gujarati or Hindi language. The workbook for the module is presently available in ENGLISH.

* Candidates have the option to take the tests in English, Gujarati or Hindi languages.

# Candidates securing 80% or more marks in NSDL-Depository Operations Module ONLY will be certifi ed as Trainers.

** Following are the modules of Financial Planning Standards Board India (Certifi ed Financial Planner Certifi cation)

- FPSB India Exam 1 to 4 i.e. (i) Risk Analysis & Insurance Planning (ii) Retirement Planning & Employee Benefi ts(iii) Investment Planning and (iv) Tax Planning & Estate Planning

- Examination 5/Advanced Financial Planning

## Modules of Finitiatives Learning India Pvt. Ltd. (FLIP)

### Module of IMS Proschool

The curriculum for each of the modules (except Modules of Financial Planning Standards Board India, Finitiatives Learning India Pvt. Ltd. and IMS Proschool) is available on our website: www.nseindia.com > NCFM > Curriculum & Study Material.

1

CONTENTS

CHAPTER 1: SECURITIES MARKET IN INDIAAN OVERVIEW ............................... 11

1.1 INTRODUCTION ......................................................................................11

1.2 PRODUCTS, PARTICIPANTS AND FUNCTIONS ..................................................12

1.3 SECURITIES MARKET AND FINANCIAL SYSTEM ...............................................14

1.4 DERIVATIVES MARKET .................................................................................16

1.5 REGULATORY FRAMEWORK ..........................................................................17

1.5.1 Legislations ...................................................................................17

1.5.2 Rules Regulations and Regulators ....................................................19

1.5.3 Reforms Since 1990s......................................................................19

1.6 ROLE OF NSE IN INDIAN SECURITIES MARKET ...............................................31

CHAPTER 2: PRIMARY MARKET ............................................................................ 37

2.1 INTRODUCTION ......................................................................................37

2.2 MARKET DESIGN ......................................................................................37

2.2.1 SEBI Issue of Capital and Disclosure Requirements (ICDR)

Regulations 2009 ..........................................................................37

2.2.2 Merchant Banking ..........................................................................44

2.2.3 Credit Rating .................................................................................45

2.2.4 Demat Issues ................................................................................45

2.2.5 Private Placement ..........................................................................45

2.2.6 Virtual Debt Portal .........................................................................46

2.2.7 ADRs/GDRs ...................................................................................46

CHAPTER 3: SECONDARY MARKET ....................................................................... 49

3.1 INTRODUCTION ......................................................................................49

3.2 MARKET DESIGN ......................................................................................49

3.2.1 Stock Exchanges ...........................................................................49

3.2.2 Membership in NSE ........................................................................53

3.2.3 Listing of securities ........................................................................58

3.2.4 Delisting of Securities .....................................................................59

3.2.5 Listing of Securities on NSE .............................................................61

3.2.6 Dematerialisation ...........................................................................64

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3.3 TRADING ......................................................................................65

3.3.1 Trading Mechanism ........................................................................65

3.3.2 Order Management ........................................................................74

3.3.3 Trade Management ........................................................................80

3.3.4 Auction ......................................................................................81

3.3.5 Internet Broking ............................................................................83

3.3.6 Wireless Application Protocol ...........................................................83

3.3.7 Trading Rules ................................................................................83

3.4 CLEARING AND SETTLEMENT ........................................................................87

3.4.1 Clearing and Settlement Mechanism .................................................87

3.4.2 Rolling Settlement .........................................................................94

3.5 RISK MANAGEMENT ....................................................................................99

3.5.1 Capital Adequacy Requirements .......................................................99

3.5.2 Margins ....................................................................................101

3.5.3 On-Line Exposure Monitoring .........................................................109

3.5.4 Off-line Monitoring .......................................................................109

3.5.5 Index-based Market-wide Circuit Breakers/ Price Bands for Securities .109

3.5.6 Settlement Guarantee Mechanism ..................................................110

3.5.7 Investor Protection Fund ...............................................................115

3.6 MARKET INDEX ....................................................................................116

3.6.1 Understanding the index number ...................................................117

3.6.2 Understanding S&P CNX NIFTY ......................................................121

3.6.3 India Index Services & Products Ltd. (IISL) .....................................124

CHAPTER 4: GOVERNMENT SECURITIES MARKET .............................................. 127

4.1 INTRODUCTION TO INDIAN DEBT MARKETS .................................................127

4.1.1 Market Subgroups ........................................................................129

4.1.