NISM Series IV: Interest Rates Derivatives Practice Exam
The NISM Series IV: Interest Rate Derivatives Certification Examination is designed to assess your understanding of interest rate derivatives and their role in the financial markets. Earning this certification demonstrates your knowledge of these complex financial instruments used for managing interest rate risk.
Who Should Take This Exam?
This exam is ideal for individuals working in or aspiring to careers within the following areas:
- Financial institutions (banks, investment banks) dealing with interest rate derivatives.
- Roles involving risk management or trading of fixed-income securities.
- Regulatory and compliance professionals overseeing interest rate derivative activities.
Are There Prerequisites?
There are no formal prerequisites to take the NISM Series IV exam. However, a foundational understanding of fixed-income securities and financial markets is recommended for success.
Roles and Responsibilities
Individuals with expertise in interest rate derivatives may fulfill roles like:
- Interest Rate Derivatives Trader: Executing trades involving interest rate derivatives to manage risk or speculate on interest rate movements.
- Risk Manager: Assessing and mitigating risks associated with interest rate fluctuations using derivative instruments.
- Structurer: Designing customized interest rate derivative products to meet specific client needs.
- Salesperson: Marketing and selling interest rate derivative products to institutional investors.
Exam Details
- Exam Format: Multiple Choice Questions (100 questions)
- Duration: 2 hours
- Negative Marking: 25% of the marks assigned to a question for each wrong answer.
- Passing Score: 60%
Course Outline
On successful completion of the examination the candidate should:
- Know the basics of fixed income securities markets and specifically interest rate derivative markets in Indian and developed world.
- Understand the analytical framework required for Bond Futures market in India along with trading and hedging strategies involved
- Understand the clearing, settlement and risk management as well as the operational mechanism related to interest rate derivatives markets
- Know the regulatory environment in which the interest rate derivatives markets operate in India.