Investment Advisory Mock Test

Course Content

CHAPTER 1: INTRODUCTION TO INDIAN FINANCIAL MARKET

 The Indian Economy, The Indian Financial Markets (Key Features), Structure of Financial Markets in India (Banking System, Securities Market, Commodities Market, Foreign Exchange Market, Insurance Market, Pension Market), Role of Participants in the Financial Markets, Regulators of Financial Markets ( such as Ministry of Finance, Ministry of Corporate Affairs, Registrar of Companies, The Reserve Bank of India (RBI), Securities and Exchange Board of India (SEBI) or etc)

 CHAPTER 2: SECURITIES MARKET SEGMENTS

Nature and Definition of Primary Markets, Functions of the Primary Market, Types of Issues (Public issue, Private placement, Preferential issue, Qualified Institutional Placement (QIP) Rights and Bonus issues), Issuers (Central, State and Local Governments, Public Sector Units, Private Sector Companies, Banks, Financial Institutions and Non-banking Finance Companies, Mutual Funds), Types of Investors, Types of Public Issue of Equity Shares (Initial Public Offer (IPO), Follow-on Public Offer, Pricing a Public Issue of Shares, Fixed Price Issue, Book Built Issue), Regulatory Norms for Public Issue of Shares, Applying to a Public Issue, Public Issue of Debt Securities, Dematerialization, Coupon Rate, Debenture Trustees, Private Placements in Equity and Debt, Qualified Institutional Placement, Institutional Placement Program (IPP), Issue of Specified Securities by Small and Medium Enterprises (SME), Role and Function of the Secondary Market, Functions of Secondary Markets, Market Structure and Participants, Market Information (Market Capitalisation, Market Turnover, Market Indices, Reading Market Prices), Risk Management Systems in the Secondary Markets, Corporate Actions

CHAPTER 3: MUTUAL FUNDS

 Meaning and features of Mutual Fund, Concepts and Terms Related to Mutual Funds, Regulatory Framework of Mutual Funds, Mutual Fund Products, Taxation of Mutual Fund Products, Mutual Fund Investment Options, Process associated with Investment in Mutual Funds, Systematic Transactions, Benefits of Investing in Mutual Funds

CHAPTER 4: INVESTMENT PRODUCTS

Small Saving Instruments, Public Provident Fund, National Savings Certificate (NSC), Senior Citizens’ Saving Scheme (SCSS), Post Office Schemes and Deposits (Post Office Monthly Income Scheme (POMIS), Post Office Time Deposits (POTD), Post Office Recurring Deposit), Fixed Income Instruments, Government Securities, Inflation-Indexed Bonds, Corporate Bonds, Infrastructure Bonds, Bank Deposits, Alternate Investments, Derivatives and Structured Products, Hedging, Speculation, Arbitrage, Futures, Options, Option Terminology, Real Estate, Gold, Commodities, Private Equity and Venture Capital, SEBI (Alternative Investment Funds) Regulations, 2012, Category of Funds, Eligibility Norms, Investment Norms, International Investments, Art and Collectibles, Direct Equity, Market Indicators, Fundamental Analysis and EIC Framework, Valuation Measures Price (Price-Earnings Multiple, Market price per share/Earnings per share, Price to Book Value (PBV), Dividend Yield), Technical Analysis

CHAPTER 5: MANAGING INVESTMENT RISK

Risk, Common Types of Risk (Inflation Risk, Default Risk, Liquidity Risk, Re-investment risk, Business Risk, Exchange Rate Risk, Interest Rate Risk, ot etc), Measuring Risk, Computing Standard Deviation and Variance

CHAPTER 6: MEASURING INVESTMENT RETURNS

Understanding Return, Understanding Return Concepts (Absolute Return, Annualized Return), The Concept of Compounding Compound Return, Time Value of Money, Annuities, Concept of CAGR, Internal Rate of Return (IRR), Net Present Value (NPV), Holding Period Return, Real Rate of Return vs. Nominal Rate of Return, Tax Adjusted Return, Risk Adjusted Returns

CHAPTER 7: CONCEPT OF FINANCIAL PLANNING

Financial Planning, Need for Financial Advisory Services, Scope of Financial Planning Services (Personal financial analysis, Debt counselling, Insurance Planning, Investment Planning and Asset Allocation, Tax Planning, Tax Planning), Financial Advisory and Execution, Assets, Liabilities and Networth, Preparation of Budget, Financial Planning Delivery Process, Defining the Client-Planner Relationship, Understanding Client’s Financial Situation, Identifying Financial Goals, Goal Value, Time to Goal or Investment Horizon, Funding the goal, Risk Profiling, Risk Profiling, Risk Profiling

CHAPTER 9: INSURANCE PLANNING

Need for Insurance, . Requirements of an Insurable risk, Role of Insurance in Personal Finance, Steps in Insurance Planning, Insurance Products, Life Insurance Products, Non- Life Insurance, . Life Insurance Needs Analysis

CHAPTER 10: RETIREMENT PLANNING

Introduction to retirement planning process, Estimating the Retirement Corpus, Estimating Income Requirement, Income Replacement Method, Expense Protection Method, Determining the Retirement Corpus, The Expected Rate of Return, Calculation of Retirement Corpus, Saving & Investment Plan to Create Retirement Corpus, Review and Monitoring, Retirement Products, Mandatory Retirement Benefit Schemes Employee, Provident Fund Scheme, Employee Pension Scheme, Employee Deposit-Linked Insurance Scheme, National Pension System (NPS) for Government Employees, Voluntary Retirement Schemes, Voluntary Provident Fund (VPF), National Pension System (NPS), NPS – Investment Fund Options, Death and Maturity Benefits, Senior Citizens’ Saving Scheme (SCSS), Post Office Monthly Income Scheme (POMIS), Monthly income plans (MIPs)

CHAPTER 11: TAX AND ESTATE PLANNING

Understand Income tax principles, aspects of investment products, Wealth Tax Act and its implication for clients, Estate Planning

CHAPTER 12: REGULATORY ENVIRONMENT AND ETHICAL ISSUES

Regulation for Investment Advisers, Regulatory System and Environment, Role of Regulators,. Role of Self-Regulatory Organizations (SRO), Prevention of Money-Laundering Act, 2002, Code of Conduct and Ethics, Ethical Issues in providing Financial Advice, Investor Complaint redressal systems.