NISM Series XIII: Common Derivatives Certification Guide

Foundation concepts: what are derivatives, OTC vs. exchange-traded distinction, the four major categories (forwards, futures, options, swaps), and the function of derivatives in modern financial markets for hedging, speculation, and arbitrage.

Stock and index futures pricing, basis risk, equity option Greeks, payoff diagrams for standard strategies, put-call parity, and the role of equity derivatives in portfolio management. Candidates with prior NISM VIII preparation will find this section familiar.

INR currency futures and options (USD/INR, EUR/INR, GBP/INR, JPY/INR), forward rate calculations, cross-currency pairs, hedging strategies for exporters and importers, and the distinction between FEMA-compliant hedging and speculative trades.

Bond pricing fundamentals, duration and convexity concepts, exchange-traded interest rate futures on G-Secs and T-Bills, cheapest-to-deliver bond, and hedging bond portfolios using IRF. Less mathematically intensive than NISM Series IV but conceptual clarity is essential.

An important differentiator from the other three series. Covers commodity futures and options traded on MCX and NCDEX, price discovery in commodity markets, physical delivery vs. cash settlement, commodity-specific regulations, and the role of FMC (merged with SEBI).

Payoff analysis for multi-leg option strategies across all underlying asset classes — equities, currencies, and interest rates. Focus on break-even calculation, maximum profit/loss, and the directional/volatility view each strategy encapsulates.

Unified look at order management, trading hours, lot sizes, and position limits across equity, currency, and interest rate derivative segments. Differences and commonalities between NSE, BSE, and MCX trading platforms.

How clearing corporations (NSCCL, ICCL, MCXCCL) operate across segments, margin frameworks, daily settlement, expiry settlement procedures, and default management.

SEBI's omnibus regulation covering all three derivative segments, reporting obligations, compliance requirements, and investor protection norms applicable across equity, currency, and interest rate derivatives.

Integrated risk management concepts: how market risk, counterparty risk, and operational risk are managed at the exchange, clearing corporation, and member levels.

Broad overview of accounting treatment and tax classification applicable to profits/losses across all derivative segments.

Ethical obligations, conflict of interest policies, fair dealing norms, and the consequences of regulatory violations for registered market participants.