NISM Series X-A Investment Adviser Level 1 Quiz

A certification program by the National Institute of Securities Markets (NISM) to enhance quality and standards of financial professionals.

A category of financial professional certification by NISM focusing on fundamental investment knowledge.

The specific series/code for the Investment Adviser (Level 1) certification.

The system where financial instruments like stocks, bonds and funds are traded or exchanged.

Formal training and learning to develop skilled financial professionals or market players

Developing skills and knowledge of stakeholders in the financial markets.

Assessments to gauge knowledge and skills of professionals in various financial segments.

Ongoing training programs for professionals to maintain and enhance skills in financial markets.

Involves understanding income, expenses, future goals, assets, and liabilities to effectively manage personal finances.

Experts who help individuals manage their finances, focusing on goals, asset allocation, and financial products.

Specific objectives individuals aim for regarding their money, such as retirement or buying a home.

The act of strategically assigning money to different asset classes (like stocks or bonds) to meet financial objectives.

Financial instruments, like stocks, bonds, or mutual funds, used to grow capital.

A systematic approach considering all financial needs (retirement, insurances) of an individual.

Financial planning is a holistic approach addressing all financial needs; financial advisory usually focuses on a specific area (stocks, debt).

Continuously adjusting to changing market conditions and client needs for optimal results.

A situation where someone spends less than they earn but still struggles to meet their financial obligations due to uneven income and expenses.

A detailed plan outlining all income and expenses, helping individuals control their finances.

A risk-transfer mechanism where a small payment (premium) protects against financial losses from unexpected events.

The process of planning and handling financial liabilities effectively.

A professional who helps individuals plan and manage their investments and liabilities.

A type of insurance that provides financial protection to beneficiaries in case of the policyholder's death.

Provides financial protection against medical expenses incurred due to illness or accidents.

Covers financial losses from damage or theft of property and other valuables.

A situation where a financial advisor's personal gain (e.g., higher commission) may influence their recommendations, potentially harming the client's interests.

Selling a financial product that is not suitable for the client's needs or risk profile, potentially leading to financial loss for the client.

A financial advisor who earns income solely from client fees, not commissions from selling financial products.

Various ways fee-only planners charge clients, including one-time planning fees, ongoing review fees, asset-based fees, and referral fees for specific services.

A fee-only planner primarily advises clients on their financial planning needs, without executing transactions or selling products for commissions.

In India, financial advisors offering advice for a fee must be registered with SEBI and are prohibited from earning commissions from product producers.

Some exceptions exist for those offering financial advice as part of selling a product (e.g., insurance agent offering investment advice).

Distributors sell financial products and earn commissions from producers, while advisors provide advice and earn fees from clients.

The effect where interest earned on an investment is re-invested and earns further interest, leading to exponential growth.

How often interest is calculated and added to the principal, impacting the final return.

The total amount received at the end of an investment period, including principal and accumulated interest.

A function in Excel used to calculate the future value of an investment, considering interest rate, time period, and payments.

The percentage gain or loss on an investment, expressed as a percentage of the initial investment.

The constant rate of growth that would equate the initial value of an investment to its final value over a specific period.

The concept that money received today is worth more than the same amount received in the future due to its potential to earn interest.

Money received by an investor from an investment, such as interest payments or dividends.

Analyzing how taxes impact your income, investments, and saving for future goals. It helps you make smart financial decisions to maximize your returns after taxes.

The actual return on your investment after all taxes are paid. It's the real amount you get to keep.

Creating a financial strategy for your life after you stop working, ensuring you have enough money to live comfortably.

The effect where interest earned on an investment is reinvested and earns even more interest over time, steadily increasing your wealth.

Adjusting your investment portfolio as retirement nears, shifting to less risky assets to protect your savings.

Making plans for how your wealth will be distributed after your death, ensuring it goes to your loved ones.

Regularly reviewing your investments in retirement to ensure they still meet your needs and adjusting them as your expenses change.