The examination seeks to create a common minimum knowledge benchmark for associated persons functioning as approved users and sales personnel of the trading member of an equity derivatives exchange or equity derivative segment of a recognized stock exchange. Approved users and Sales personnel of the trading member of an equity derivatives exchange or equity derivative segment of a recognized stock exchange. Basics of the Indian equity derivatives market. Various trading strategies that can be built using futures and options on both stocks and stock indices.
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Here, we will discuss the certifications cited above which would be of help in earning these proficiency certificates. These certifications can be of special interest to those professionally involved with the derivatives market and intending to further their career.
Beginning with an introduction and definition of derivatives, their role, limitations, and utility, the curriculum goes on to discuss trading futures and options before culminating with the methods of tracking, settlement, accounting and taxation of derivatives on the exchange.
Relevance: This certification can be especially useful for individual investors, employees of BPOs or IT companies, employees of brokers or sub-brokers along with those interested in the field. Exam Weightage or Breakdown: It must be kept in mind that different topics covered in the curriculum content are not weighted equally in the exam and the candidates should be aware of the exam weightage or breakdown.
This could help them prepare better and ensure they are well prepared for high weightage areas to be able to score well during the exam. Subject-wise weights or breakdown: Introduction 15 marks , Definition of Basic Derivatives 15 marks , Application of Derivatives 10 marks , Trading Futures 20 marks , Trading Options 20 marks , Derivatives trading on the Exchange 20 marks.
Derivatives Market Dealers Module This certification is designed to help students become acquainted with the fundamentals of equity derivatives and learn about their use in speculation, hedging and arbitraging. Students would also learn about the trading, settlement and other aspects along with risk management of equity derivatives and the regulatory framework within which the market operates. Relevance: It can be of great utility for individual investors, High-Networth Individuals HNIs , portfolio managers, stockbrokers or sub-brokers dealing in derivatives, custodians or employees of mutual funds and financial institutions along with anyone interested in the derivatives market.
Options Trading Strategies Module It is advisable to pursue the Derivatives market Dealers Module before attempting the present module which primarily focuses on different strategies employed in options trading which might be suitable under varying market conditions. This module introduces students to various options strategies and helps gain an understanding of option payoffs. The curriculum also discusses the risks involved in applying these strategies to be able to achieve the desired objective.
Relevance: This certification holds a high level of relevance for investors, traders and employees of BPOs or IT companies. Options Trading Advanced Module Building upon the foundation laid down in options trading module, this advanced level module delves deeper to help students acquire an intricate understanding of the options market and methods of identifying and applying suitable strategies. Relevance: It is useful for investors, traders and those employed with financial intermediaries to gain an expert level understanding of the working of the options market.
These certifications can be highly relevant to those professionally working as an investment analyst or similar roles and looking to further their expertise in the field along with career growth. Investment Analysis and Portfolio Management Module This certification is aimed at imparting the knowledge of fundamental principles of investment, financial markets, capital market efficiency, financial analysis and valuation, and investment management among other things.
An important focus of the course is on portfolio management and students are introduced to the modern portfolio theory along with various aspects of managing a portfolio. Technical Analysis Module This module introduces students to the fundamentals of technical analysis and goes on to discuss more intricate aspects of technical analysis including different types of charts, patterns, and indicators along with their significance. The curriculum also discusses various trading strategies and the trading psychology at work along with the aspect of risk management to offer a complete and comprehensive view of technical analysis.
Relevance: This certification holds special relevance to employees of treasury and investment divisions of banks and financial institutions, stock analysts and finance professionals in general. Fundamental Analysis Module This certification discusses the definition and basics of fundamental analysis and how it can help make better investment decisions.
Next, the curriculum discusses financial statements that form the core of financial analysis involved in the process before dealing with the concepts of various valuation methodologies employed for the purpose. Relevance: This certification is of special utility to professionals working with treasury and investment divisions of banks and financial institutions, stock analysts and other finance professionals. Subject-wise weights or breakdown: Introduction 15 marks , Brushing Up the Basics 15 marks , Understanding Financial Statements 35 marks , Valuation Methodologies 35 marks.
Wealth Management Module This is a unique certification that deals with personal financial planning and wealth management at length, discussing the concepts involved and identifying the most suitable investment options and strategies along with risk management.
The curriculum discusses various types of investment products and services along with methods of investment evaluation, risk profiling, and asset allocation. Relevance: This certification holds special relevance for investors and finance professionals seeking expert knowledge of wealth management concepts for study and practical application.
NCFM Study Material On enrollment for any specific module, the study material is provided only in electronic format to students. However, no study material is available for the Compliance Officers Module and the candidates are required to refer to relevant books, circulars, and manuals in keeping with the prescribed curriculum. Instead, make it a point to study at length and focus on underlying concepts and their application in practical situations.
Remember Subject Weights: Keep in mind that certain specific portions have higher weights than other parts, make sure to study them thoroughly to not miss out on those critical marks.
Do not make the mistake of focusing only on high weightage areas as well, become thoroughly acquainted with the curriculum. Practice Makes You Perfect: Practice as many mock tests as available online as possible. It would help you identify weak areas and make improvements accordingly.
This would help you with time management as well during the exam. Sometimes tricky and similar words are used in defining responses but be sure that only one of them is correct. Make a wise choice. Avoiding any negative marking can help you score higher. Start Easy, Manage your Time: Always start with the easiest questions and leave the tougher ones for the latter half of the exam and be sure to keep an eye on the time. One must enroll again for a module to sit for the exam on a new schedule.
Beginner’s Guide to NCFM Certification Exam
Here, we will discuss the certifications cited above which would be of help in earning these proficiency certificates. These certifications can be of special interest to those professionally involved with the derivatives market and intending to further their career. Beginning with an introduction and definition of derivatives, their role, limitations, and utility, the curriculum goes on to discuss trading futures and options before culminating with the methods of tracking, settlement, accounting and taxation of derivatives on the exchange. Relevance: This certification can be especially useful for individual investors, employees of BPOs or IT companies, employees of brokers or sub-brokers along with those interested in the field.
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