2026 Latest 100% Exam Passing Ratio - NISM-Series-VII Dumps PDF
Pass Exam With Full Sureness - NISM-Series-VII Dumps with 334 Questions
NEW QUESTION # 69
Under Section 12 of the Prevention of Money Laundering Act (PMLA), 2002, what is the mandatory retention period for documents evidencing the identity of clients and beneficial owners?
- A. Five years after the business relationship between a client and the reporting entity has ended or the account has been closed, whichever is later.
- B. Two years from the date of the last transaction in the account.
- C. Five years from the date of the specific transaction.
- D. Ten years from the date of account opening.
- E. Seven years from the date of the suspicious transaction report filing.
Answer: A
Explanation:
The PMLA stipulates two different retention periods. Records of transactions must be maintained for five years from the date of transaction. However, records of documents evidencing identity of clients and beneficial owners must be maintained for five years after the business relationship has ended or the account has been closed, whichever is later.
NEW QUESTION # 70
In the context of facilitating Initial Public Offerings (IPO), how does the electronic trading infrastructure of broking firms specifically assist investors and the process?
- A. Brokers' systems are connected with the Stock Exchanges' main IPO system, allowing for the online uploading of application forms.
- B. Brokers fund the entire IPO application amount for the investor interest-free.
- C. Brokers determine the IPO issue price through an internal book-building process independent of the exchange.
- D. Brokers physically collect all applications and manually courier them to the Registrar, bypassing the electronic system.
- E. Brokers provide a guarantee of allotment to their registered clients for every IPO application.
Answer: A
Explanation:
The text explains that 'The IPO process is facilitated by brokers as their system is connected with the stock Exchanges main IPO system and online uploading of forms is carried out. Thus, at any given time, the online status is available on the stock Exchanges.'
NEW QUESTION # 71
According to the eligibility criteria for 'Accredited Investors' in the Indian securities market, which of the following financial profiles satisfies the requirements for an Individual or HUF to obtain accreditation?
- A. Annual Income INR 2 Crore, irrespective of Net Worth composition
- B. Net Worth 2 INR 5 Crore, with no specific requirement for financial assets
- C. Net Worth 2 INR 7.5 Crore, out of which at least INR 3.75 Crore is in the form of financial assets
- D. Annual Income 2 INR 1 Crore AND Net Worth 2 INR 3 Crore
- E. Annual Income 2 INR 50 Lakhs AND Net Worth INR 5 Crore
Answer: C
Explanation:
As per the eligibility criteria for Accredited Investors, an Individual, HIJF, Family Trust, or sole proprietorship must meet one of the following: (i) Annual Income >= INR 2 Crore; OR (ii) Net Worth >= INR 7.5 Crore, out of which at least INR 3.75 Crore is in the form of financial assets; OR (iii) Annual Income >= INR 1 Crore + Net Worth >= INR 5 Crore, out of which at least INR 2.5 Crore is in the form of financial assets.
NEW QUESTION # 72
Which of the following benefits is explicitly granted to 'Accredited Investors' under the 'regulation-light framework'?
- A. Exemption from the lock-in period requirements for pre-IPO holdings
- B. Complete waiver of KYC documentation requirements
- C. Exemption from payment of Securities Transaction Tax (STT)
- D. Guaranteed allocation in Initial Public Offers (IPOs)
- E. Ability to participate in investment products with an investment amount lesser than the minimum amount mandated in respective regulations
Answer: E
Explanation:
Accredited Investors are entitled to benefits such as participating in investment products with an investment amount lesser than the minimum amount mandated in the respective Regulations ('lower ticket size') and relaxation from certain regulatory requirements ('regulation-light framework')-.
NEW QUESTION # 73
As per the SEBI International Financial Services Centres (IFSC) guidelines, 2015, which of the following types of securities and products are permitted for dealing on the stock exchanges operating in the IFSC? (Select all that apply)
- A. REITs and InviTs
- B. Equity shares of a company incorporated outside India
- C. Debt securities issued by eligible issuers
- D. Currency and interest rate derivatives
- E. Depository receipts
Answer: A,B,C,D,E
Explanation:
As per the SEBI International Financial Services Centres (IFSC) guidelines, 2015, the stock exchanges operating in IFSC are permitted to deal in all the listed options: Equity shares of a company incorporated outside India, Depository receipt(s), Debt securities issued by eligible issuers, Currency and interest rate derivatives, Index based derivatives, Commodity derivatives, and REITs and InvITs.
NEW QUESTION # 74
According to the Securities Contracts (Regulation) Act, 1956 (SCRA), the definition of 'Securities' has been expanded to include various instruments. Which of the following specific instruments is explicitly included in this definition as per the Act?
- A. Real Estate Sale Deeds registered under the Registration Act
- B. Insurance Policies linked to Unit Linked Insurance Plans (ULIPs)
- C. Promissory Notes issued by private individuals for personal loans
- D. Electronic Gold Receipts issued on the basis of deposit of underlying physical gold
- E. Fixed Deposit Receipts issued by Scheduled Commercial Banks
Answer: D
Explanation:
As per the definition of 'Securities' in the Securities Contract Regulation Act (SCRA), 1956, the term includes 'Electronic Gold Receipt', which means an electronic receipt issued on the basis of deposit of underlying physical gold in accordance with regulations made by SEBI. It also includes Zero Coupon Zero Principal Instruments, among others like shares, bonds, and derivatives.
NEW QUESTION # 75
Under the framework for 'Segregation and Monitoring of Collateral at Client Level', when the Clearing Corporation (CC) receives a trade from a client account, what is the specific sequential order in which the margin is blocked if the primary source is insufficient?
- A. Client Collateral -> TM Proprietary Collateral -> CM Proprietary Collateral
- B. TM Proprietary Collateral -> Client Collateral -> CM Proprietary Collateral
- C. CM Proprietary Collateral TM Proprietary Collateral -> Client Collateral
- D. Client Collateral Excess Collateral of other Clients CM Proprietary Collateral
- E. Client Collateral -> CM Proprietary Collateral -> TM Proprietary Collateral
Answer: A
Explanation:
According to the margin payment and collateral segregation guidelines, on receipt of a trade from a client account by the CC, the margin shall first be blocked from the value of the client collateral. If the client collateral is not sufficient, the residual margin shall be blocked from the TM proprietary collateral. If the TM proprietary collateral is also not sufficient, then the residual margin shall be blocked from the CM proprietary collateral.
NEW QUESTION # 76
When the Clearing Corporation conducts an auction for a short delivery but fails to find any sellers for the specific security, a 'Close Out' is initiated. According to the settlement process guidelines, how is the compensation value determined for the buyer in this specific scenario?
- A. At the highest price prevailing across the stock exchange from the day of trading till the auction/close out day OR 20% above the official closing price on the auction day, whichever is higher.
- B. At the highest price recorded for the security during the last 52 weeks.
- C. At the weighted average price of the security on the trading day plus the standard deviation margin.
- D. At the valuation price used for the initial valuation debit plus a 5% close-out charge.
- E. At the closing price of the security on the day of the auction plus a fixed penalty of 10%.
Answer: A
Explanation:
If on the auction day, there are no sellers for a particular short delivery, the Clearing Corporation carries out a 'Close out'. The buyer is compensated by paying the value of the short delivered security at the highest price prevailing across the stock exchange from the day of trading till the auction/close out day OR 20% above the official closing price on the auction day, whichever is higher.
NEW QUESTION # 77
In the General Clearing Process for the Cash Segment under the T+1 rolling settlement cycle, by what specific time must the custodial confirmation of trades be completed on the T+1 day?
- A. By 1:30 PM on T+1 Day
- B. By 4:15 PM on T Day
- C. By 11:00 AM on T+1 Day
- D. By 7:30 AM on T+1 Day
- E. By 9:00 AM on T+1 Day
Answer: D
Explanation:
According to the General Clearing process in Cash Segment for T+1 rolling settlement, the clearing members/custodians must confirm back institutional/Custodian Participant trades by 7:30 a.m. on T+1 day. Subsequently, the final obligations are downloaded by 9:00 a.m.
NEW QUESTION # 78
An 'Accreditation Agency' issues an accreditation certificate to an investor. Under what specific condition regarding the investor's financial history is this certificate valid for a period of three years from the date of issuance?
- A. If the applicant meets the eligibility criteria for the preceding one financial year
- B. If the applicant meets the eligibility criteria in each of the preceding two financial years
- C. If the applicant is a Body Corporate with a Net Worth INR 50 Crore
- D. If the applicant is a newly incorporated entity meeting the net-worth criteria as on the date of application
- E. If the applicant submits a bank guarantee equivalent to the net worth requirement
Answer: B
Explanation:
The validity of the accreditation certificate depends on the financial history: If the applicant meets the eligibility criteria for the preceding one financial year, the validity is two years. If the applicant meets the eligibility criteria in each of the preceding two financial years, the validity is three years. Newly incorporated entities meeting net-worth criteria get a two-year validity.
NEW QUESTION # 79
Once a conciliator is appointed by the ODR Institution, what is the prescribed timeline for the disputing parties to reach an amicable resolution, and under what condition can this period be extended?
- A. 30 calendar days, extendable by 15 days upon approval by the MI.
- B. 45 calendar days, with no provision for extension to ensure speedy disposal.
- C. 15 calendar days, extendable by 7 days if the conciliator deems it necessary.
- D. 10 calendar days, extendable by 10 calendar days upon payment of late fees.
- E. 21 calendar days, extendable for a maximum period of 10 calendar days by consent of the disputing parties.
Answer: E
Explanation:
The source states: 'Such conciliator shall conduct one or more meeting/s for the disputing parties to reach an amicable and consensual resolution within 21 calendar days (unless extended for a maximum period of 10 calendar days by consent of the disputing parties to be recorded in writing/electronically)'.
NEW QUESTION # 80
Stock Exchanges are required to maintain an Investor Services Fund (ISF) distinct from the Investor Protection Fund (IPF). What is the specific contribution requirement from the Stock Exchange towards the ISF?
- A. 100% of the interest earned on the 1% security deposit of issuer companies.
- B. 1% of the listing fees received, on a quarterly basis.
- C. The penalty collected for client code modification.
- D. 5% of the transaction charges collected from members.
- E. At least 20% of the listing fees received.
Answer: E
Explanation:
For the Investor Services Fund (ISF), the text states: 'The stock exchange shall set aside at least 20% of the listing fees received for ISF for providing services to the investing public.' Note that 1% of listing fees goes to the IPF, while 20% goes to the ISF.,
NEW QUESTION # 81
In the context of the SEBI Complaints Redress System (SCORES), certain types of complaints are explicitly excluded from its purview Which of the following scenarios represents a complaint that is NOT dealt with through SCORES?
- A. Complaint against a company where a moratorium order is passed in insolvency proceedings
- B. Complaint regarding unauthorized trading by a registered stock broker
- C. Complaint regarding non-receipt of refund in an Initial Public Offer (IPO)
- D. Complaint regarding non-receipt of dividend from a listed company
- E. Complaint regarding discrepancy in the demat account holding statement
Answer: A
Explanation:
Complaints against a sick company or a company where a moratorium order is passed in winding up / insolvency proceedings are not dealt through SCORES. The other options represent valid grievances against active intermediaries or listed companies.
NEW QUESTION # 82
Which of the following statements accurately describe the operational mechanisms and participants of the Indian Money Market segments? (Select all that apply)
- A. Notice Money transactions refer to borrowing for a period specifically between 15 days and 1 year.
- B. Repo transactions against Government Securities are traded/reported on the Clearcorp Repo Order Matching System (CROMS).
- C. All India Financial Institutions can issue Certificates of Deposit (CDs) for a period not exceeding 1 year.
- D. Call money market transactions are restricted to Scheduled Commercial Banks (SCBs) and Primary Dealers (PDs).
- E. Treasury Bills (T-bills) are zero coupon securities issued at a discount and traded on the NDS-OM platform.
Answer: B,D,E
Explanation:
Statement A is correct as the call money market is restricted to SCBs and PDs. Statement C is correct as Repo transactions against G-secs are traded/reported on CROMS. Statement E is correct as T-bills are zero coupon securities traded on NDS-OM. Statement B is incorrect because Notice Money is for up to 14 days, whereas 15 days to 1 year is Term Money. Statement D is incorrect because All India Financial Institutions can issue CDs for a period not less than 1 year and not exceeding 3 years.
NEW QUESTION # 83
While institutional trades generally do not attract upfront margins, specific categories of institutional investors are subject to upfront margining similar to non-institutional trades. Identify the category from the list below.
- A. Mutual Funds registered with SEBI
- B. Insurance Companies registered with IRDAI
- C. Category I Foreign Portfolio Investors (Sovereign Wealth Funds)
- D. Public Financial Institutions defined under the Companies Act
- E. Category II FPIs who are corporate bodies, individuals, or family offices
Answer: E
Explanation:
Trades of Category II FPIs who are corporate bodies, individuals, or family offices and domestic entities who may choose to settle trades through a Custodian shall be margined on an upfront basis as per the margining framework of non-institutional trades. Other institutional trades are margined on T+1 day subsequent to confirmation.
NEW QUESTION # 84
Under the mechanism of 'Net Settlement of Cash segment and Futures & Options (F&O) segment upon expiry of stock derivatives', which of the following investor scenarios is ELIGIBLE for the benefit of netting (merged settlements)?
- A. An Institutional Investor (FPI Category l) trading through the same Trading Member and Clearing Member in both segments.
- B. A Portfolio Management Service (PMS) client who is mandatorily directed to enter into delivery-backed transactions.
- C. A retail investor whose Trading Member clears trades in both F&O and Cash segments through the same Clearing Member.
- D. A retail investor whose Trading Member clears F&O trades through Clearing Member 'X' and Cash trades through Clearing Member 'Y'.
- E. An investor trading through two different Trading Members who both clear through the same Clearing Member.
Answer: C
Explanation:
The benefit of netting (merged settlements) is available to investors whose trading member (TM) clears trades in F&O segment and cash segment through the same clearing member (CM). It is not available if the TM clears through different CMs. It is also not available for institutional investors (including FPIs) and participants like PMS mandated to enter delivery-backed transactions.
NEW QUESTION # 85
Regarding the handling of 'Funded Stocks' purchased under the Margin Trading Facility (MTF), which of the following operational procedures is mandated for the Stock Broker (Trading Member)?
- A. Funded stocks must be transferred to the client's beneficiary account immediately without any pledge.
- B. Funded stocks should be held in a separate 'Client Collateral Account' and can be re-pledged to the Clearing Corporation for other clients' margin obligations.
- C. Funded stocks must be transferred to the client's demat account followed by the creation of an auto-pledge in favor of the broker's 'Client Securities under Margin Funding Account'.
- D. Funded stocks must be transferred to a 'Client Unpaid Securities Pledgee Account' and disposed of within 5 days if payment is not received.
- E. Funded stocks must be kept in the broker's 'Pool Account' until the client makes full payment.
Answer: C
Explanation:
Funded stocks held by the TMICM under the margin trading facility shall be held by the TM/CM only by way of pledge. Such funded stocks shall be transferred to respective client's demat account followed by creation of an auto-pledge (i.e., without the requirement of a specific instruction from the client) with suitable reason, in favor of 'Client Securities under Margin Funding Account'.
NEW QUESTION # 86
Under the Online Dispute Resolution (ODR) framework, if a Market Participant wishes to initiate dispute resolution against an investor/client through the ODR Portal, which of the following procedural pre-requisites must be strictly fulfilled?
- A. The Market Participant can only initiate ODR if the claim value exceeds Rs. 10 Lakhs.
- B. The Market Participant must obtain a 'No Objection Certificate' from SEBI.
- C. The Market Participant must deposit 50% of the disputed amount with the Stock Exchange.
- D. The Market Participant must give due notice of at least 15 calendar days to the investor/client for resolution of the dispute.
- E. The Market Participant must wait for a mandatory cooling-off period of 60 days from the date of the transaction.
Answer: D
Explanation:
According to the source, 'The concerned Market Participant may also initiate dispute resolution through the ODR Portal after having given due notice of at least 15 calendar days to the investor/client for resolution of the dispute which has not been satisfactorily resolved between them'.
NEW QUESTION # 87
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