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100+ Free NISM Series II-B (RTA Mutual Fund) Practice Questions

Pass your NISM-Series-II-B: Registrars and Transfer Agents (Mutual Fund) Certification Examination exam on the first try — instant access, no signup required.

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Key Facts: NISM Series II-B (RTA Mutual Fund) Exam

100 questions

The NISM Series II-B exam consists of 100 one-mark multiple-choice questions

NISM - RTA Mutual Fund assessment structure

2 hours

Candidates have exactly 120 minutes to complete the NISM Series II-B exam

NISM - RTA Mutual Fund assessment structure

50% pass

The passing score required to obtain the certification is 50 out of 100 marks

NISM - RTA Mutual Fund FAQ

No negative marking

SEBI removed the 25% negative marking penalty for this exam effective April 1, 2025

NISM - RTA Mutual Fund assessment structure

Rs. 1,500

The standard examination fee is Rupees one thousand five hundred plus applicable taxes

NISM - RTA Mutual Fund FAQ

3 years

The RTA Mutual Fund certificate is valid for 3 years from the date of the exam

NISM - RTA Mutual Fund certification page

4 groups

The NISM Series II-B syllabus is divided into 15 units grouped under 4 weighted sections

NISM - RTA Mutual Fund curriculum

100

Free original practice questions are provided here

OpenExamPrep

NISM-Series-II-B (RTA Mutual Fund) is a SEBI-mandated certification from the National Institute of Securities Markets for associated persons of registered registrars and share transfer agents handling mutual fund operations, banking, and investor services. The exam has 100 one-mark multiple-choice questions to be completed in 2 hours, with a 50% passing score and no negative marking. The fee is Rs. 1,500 and the certificate is valid for 3 years from the date of the exam. The syllabus is weighted toward financial/non-financial transactions (30%) and RTA basics/regulations (25%). This 100-question bank gives original practice across the full RTA Mutual Fund curriculum with explanations for every option.

Sample NISM Series II-B (RTA Mutual Fund) Practice Questions

Try these sample questions to test your NISM Series II-B (RTA Mutual Fund) exam readiness. Each question includes a detailed explanation. Start the interactive quiz above for the full 100+ question experience with AI tutoring.

1Which of the following describes the primary difference between the primary market and the secondary market?
A.Securities are traded only among investors in the primary market, while issuers sell directly in the secondary market.
B.The primary market deals with the first-time issuance of securities by companies, whereas the secondary market deals with trading of already issued securities.
C.Only equity shares are traded in the primary market, while debt instruments are traded in the secondary market.
D.The secondary market has no regulatory oversight, whereas the primary market is regulated by SEBI.
Explanation: The primary market is the market where companies issue new securities to the public for the first time (such as through an IPO) to raise capital. The secondary market is where investors trade existing securities among themselves, and the issuing company is not directly involved in the transaction or its proceeds.
2What is the primary role of a Clearing Corporation in the securities market settlement process?
A.To act as a central counterparty, guaranteeing the settlement of all executed trades.
B.To on-board clients and perform their KYC verification.
C.To provide trading terminals and maintain order matching engines.
D.To hold the physical share certificates of listed companies in safe custody.
Explanation: A Clearing Corporation acts as a central counterparty (CCP) for all trades executed on the stock exchange. It performs novation, stepping in as the buyer to every seller and the seller to every buyer, thereby guaranteeing the financial settlement of the trades and eliminating counterparty risk.
3The process of converting physical security certificates into electronic balances in an investor's depository account is known as:
A.Rematerialization
B.Dematerialization
C.Securitization
D.Transmutation
Explanation: Dematerialization (Demat) is the process by which physical certificates of an investor are destroyed and an equivalent number of securities are credited in electronic form to the investor's account with a Depository Participant (DP).
4Stock exchanges perform which of the following vital functions for retail and institutional investors?
A.They guarantee that every investor will earn a profit on their equity investments.
B.They provide a continuous, liquid, and transparent platform for price discovery and trade execution.
C.They manage the individual mutual fund portfolios of retail investors.
D.They act as the main bankers for distributing retail loan products.
Explanation: Stock exchanges provide a highly organized, regulated marketplace where buyers and sellers can trade securities transparently. This secondary market activity ensures continuous liquidity for investors and enables efficient price discovery based on market supply and demand.
5Which of the following is a key right enjoyed by equity shareholders of a listed company in India?
A.The right to receive fixed, predetermined interest payments monthly.
B.The right to vote on key corporate resolutions and participate in the growth of the company.
C.The right to demand refund of capital from the company at any time before liquidation.
D.The right of priority in payment over creditors and depositors during winding up.
Explanation: Equity shareholders are the owners of the company and enjoy voting rights on major resolutions (such as appointment of directors or mergers) at general meetings. They also participate in corporate growth through dividends and capital appreciation, though these are not guaranteed.
6What distinguishes cumulative preference shares from ordinary equity shares?
A.Cumulative preference shares carry higher voting power than equity shares.
B.Unpaid dividends on cumulative preference shares accumulate and must be paid before any dividend is paid to equity shareholders.
C.Preference shares are traded continuously on stock exchanges while equity shares are not.
D.Preference shareholders have the right to claim the entire residual surplus of the company during normal operations.
Explanation: Preference shares have a preferential right over equity shares regarding dividend payments and distribution of assets during liquidation. For cumulative preference shares, if the company cannot pay dividends in a given year due to low profits, the unpaid dividend accumulates and must be cleared in future profitable years before any dividend can be distributed to equity shareholders.
7A listed company announces a stock split of 1:5 (face value Rs. 10 split to Rs. 2). What is the immediate impact on a shareholder holding 100 shares?
A.The shareholder will now hold 500 shares, and the total value of their holding will immediately quintuple.
B.The shareholder will now hold 500 shares, but the market price per share will adjust downward proportionately, keeping the total holding value unchanged.
C.The shareholder's 100 shares will remain the same, but they will receive a cash payout of Rs. 8 per share.
D.The shareholder will hold 20 shares, and the company will refund the excess capital to their bank account.
Explanation: A stock split increases the number of shares in the market while reducing the face value proportionately. In a 1:5 split, a shareholder holding 100 shares of Rs. 10 face value will now hold 500 shares of Rs. 2 face value. The market price will adjust downward by a factor of 5 on the ex-date, meaning the overall wealth of the shareholder remains unchanged initially.
8Which of the following is a primary objective for a company undertaking a share buyback?
A.To increase the overall debt-to-equity ratio by raising fresh capital.
B.To return surplus cash to shareholders, improve earnings per share (EPS), and support the market price.
C.To dilute the ownership of existing promoters to prevent hostile takeovers.
D.To convert equity shares into cumulative preference shares.
Explanation: A share buyback reduces the number of outstanding shares in the market. By doing so, the company returns excess cash to its investors, improves financial metrics like Earnings Per Share (EPS) and Return on Equity (ROE) since the share denominator is reduced, and signals management confidence, which supports the stock price.
9How does an increase in prevailing market interest rates affect the price of existing fixed-coupon bonds in the secondary market?
A.The bond prices will increase because higher market rates make existing fixed coupons more attractive.
B.The bond prices will decrease because their fixed coupon rate becomes less competitive compared to newer issuances at higher rates.
C.The bond prices will remain unaffected because the coupon rate is fixed at the time of issue.
D.The bond prices will fluctuate randomly depending on the stock index movement.
Explanation: Bond prices and market interest rates have an inverse relationship. When interest rates rise, new bonds are issued with higher coupon rates, making existing bonds with lower fixed coupon rates less attractive. To appeal to buyers, the price of existing bonds must fall so that their yield-to-maturity aligns with current market rates.
10Which money market instrument is an unsecured promissory note issued by highly rated corporates to meet short-term working capital needs?
A.Treasury Bills (T-Bills)
B.Commercial Paper (CP)
C.Certificate of Deposit (CD)
D.Collateralized Borrowing and Lending Obligation (CBLO)
Explanation: Commercial Paper (CP) is an unsecured money market instrument issued in the form of a promissory note by corporate borrowers, primary dealers, and all-India financial institutions. It enables them to diversify their sources of short-term borrowings at competitive rates for maturities ranging from 7 days up to 1 year.

About the NISM Series II-B (RTA Mutual Fund) Exam

NISM-Series-II-B: Registrars and Transfer Agents (Mutual Fund) is a SEBI-mandated certification administered by the National Institute of Securities Markets. It is the requisite standard for associated persons of registered Registrars to an Issue and Share Transfer Agents who handle mutual fund client transactions, investor records, and investor grievance redressal. The syllabus covers the structure of securities markets, characteristics of equities, debt, and other securities, and SEBI regulations governing RTAs. Furthermore, it details mutual fund structures, products, operational concepts (like NFOs, NAV calculation, and cut-off times), banking operations, financial transactions (subscriptions, redemptions, switches, SIP/STP/SWP), and non-financial transactions (change of bank mandate, address change, transmission of units). The examination has 100 one-mark multiple-choice questions to be completed in two hours, a 50% passing score with no negative marking, and the certificate is valid for three years.

Assessment

100 multiple-choice questions of 1 mark each, totalling 100 marks, drawn from fifteen chapters covering securities markets, corporate actions, SEBI rules, RTA operations, banking processes, and financial/non-financial mutual fund transactions.

Time Limit

2 hours (120 minutes).

Passing Score

50% (50 out of 100 marks). There is no negative marking.

Exam Fee

Rs. 1,500 (plus payment gateway charges and applicable GST). (National Institute of Securities Markets (NISM), established by SEBI.)

NISM Series II-B (RTA Mutual Fund) Exam Content Outline

20%

Introduction to Securities and SEBI Regulations

Understanding primary vs secondary markets, roles of clearing corporations and depositories, characteristics of equity and debt instruments, money market instruments (T-Bills, CP, CD), and SEBI regulations governing capital markets.

25%

Registrars and Transfer Agents (RTA) Basics and Regulations

Role of RTAs in corporate actions and mutual fund operations, dematerialization and rematerialization processes, SEBI RTA Regulations 1993, systems audit, cybersecurity, BCP/DR guidelines, and record preservation requirements.

25%

Mutual Fund Basics, Structure, Products and Operations

Mutual fund trust structure (Sponsors, Trustees, AMC, Custodian, RTA), product categories (open-ended, close-ended, equity, debt, hybrid, ELSS), product labeling via riskometer, and operational concepts including NFO, NAV computation, load structure, and cut-off time rules.

30%

Mutual Fund Financial and Non-Financial Transactions

Investor categories, minors investment rules, KYC/PEKRN and FATCA compliance, nomination, banking operations (collection/redemption/ECS accounts), processing purchase/redemption/switches, SIP/STP/SWP, transaction charges, and non-financial updates (bank mandate changes, transmissions, and SCORES grievance redressal).

How to Pass the NISM Series II-B (RTA Mutual Fund) Exam

What You Need to Know

  • Passing score: 50% (50 out of 100 marks). There is no negative marking.
  • Assessment: 100 multiple-choice questions of 1 mark each, totalling 100 marks, drawn from fifteen chapters covering securities markets, corporate actions, SEBI rules, RTA operations, banking processes, and financial/non-financial mutual fund transactions.
  • Time limit: 2 hours (120 minutes).
  • Exam fee: Rs. 1,500 (plus payment gateway charges and applicable GST).

Keys to Passing

  • Complete 500+ practice questions
  • Score 80%+ consistently before scheduling
  • Focus on highest-weighted sections
  • Use our AI tutor for tough concepts

NISM Series II-B (RTA Mutual Fund) Study Tips from Top Performers

1Prioritise the high-weight chapters: Financial and Non-Financial Transactions (30%) and RTA Basics/Regulations (25%) together cover 55% of the total marks.
2Understand the operational workflows thoroughly: know the exact steps for processing a redemption, change of bank mandate, dematerialization, and transmission of units.
3Memorise key regulatory numbers and timelines: such as the 8-year record preservation rule, 21-day SCORES resolution window, 3 working days redemption payout timeline, and 1:30 PM / 3:00 PM transaction cut-off times.
4Focus on the exact constituents of the mutual fund 3-tier structure (Sponsor, Trustee, AMC) and the distinct fiduciary/custodial boundaries between them.
5Take advantage of the lack of negative marking by answering all 100 questions. Practice eliminating obviously incorrect options on operational scenario questions before picking the right choice.

Frequently Asked Questions

How many questions are on the NISM Series II-B exam and what is the duration?

The exam consists of 100 multiple-choice questions of 1 mark each, totalling 100 marks, to be completed in 2 hours (120 minutes).

What is the passing score for the NISM Series II-B certification?

The passing score is 50%, meaning you must score at least 50 out of 100 marks.

Is there negative marking in the NISM Series II-B exam?

No. Under the updated SEBI rules effective April 1, 2025, negative marking has been completely removed for this examination. Every incorrect answer carries 0 penalty marks.

What is the fee and validity of the NISM Series II-B certificate?

The exam registration fee is Rs. 1,500 plus applicable gateway charges and GST. The NISM certificate remains valid for 3 years from the date of passing the exam.

Who should take the NISM Series II-B certification?

It is highly recommended and SEBI-mandated for anyone working or intending to work with Registrars to an Issue and Share Transfer Agents (RTAs) in mutual fund operations, investor servicing, client onboarding, or compliance management.

Are these official NISM exam questions?

No. These are original practice questions created by OpenExamPrep, designed to align with the NISM Series II-B syllabus and help you test your understanding of operational and regulatory concepts.