100+ Free NISM Series III-C Practice Questions

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2026 Statistics

Key Facts: NISM Series III-C Exam

60%

Passing Score

NISM

100

Questions

MCQ Format

2 hours

Exam Duration

120 minutes

₹1,500

Exam Fee

NISM

0.25

Negative Marking

Per wrong answer

The NISM Series III-C: Securities Intermediaries Compliance (Fund) Certification requires a 60% passing score (60 out of 100 questions) in a 2-hour duration. The exam fee is ₹1,500, and there is a 25% negative marking penalty for incorrect answers.

Sample NISM Series III-C Practice Questions

Try these sample questions to test your NISM Series III-C 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 intermediaries is primarily responsible for bringing buyers and sellers of securities together in the secondary market?

A.Stock brokers

B.Registrars and Share Transfer Agents (RTAs)

C.Custodians of Securities

D.Merchant bankers

Explanation: Stock brokers are registered intermediaries authorized to buy, sell, or deal in securities on behalf of investors or on their own account, facilitating trade execution in the secondary market.

2Under the current Indian regulatory framework, electronic warehouse receipts (e-NWR) representing stored agricultural commodities are primarily regulated by which body?

A.Forward Markets Commission (FMC)

B.Securities and Exchange Board of India (SEBI)

C.Warehousing Development and Regulatory Authority (WDRA)

D.Reserve Bank of India (RBI)

Explanation: The Warehousing Development and Regulatory Authority (WDRA) regulates warehouses and the issuance of negotiable and non-negotiable electronic warehouse receipts under the Warehousing (Development and Regulation) Act, 2007.

3Which of the following statements is correct regarding Global Depository Receipts (GDRs) and American Depository Receipts (ADRs)?

A.Both ADRs and GDRs must be denominated in Indian Rupees when issued by domestic companies.

B.ADRs are denominated in US Dollars and traded in the US, whereas GDRs are traded outside the US and can be denominated in multiple currencies.

C.GDRs can only be traded on European exchanges and cannot be listed on multiple exchanges globally.

D.ADRs allow domestic investors in India to buy shares of overseas companies directly in Indian Rupees.

Explanation: ADRs are negotiable certificates issued by a US depository bank representing a specified number of shares in a foreign company's stock traded on US markets. GDRs are similar but are traded on international markets outside the US, such as London or Luxembourg, and may be denominated in US Dollars or Euros.

4Which of the following represents a key legal and operational distinction between Warrants and Options?

A.Warrants grant the holder an obligation to purchase shares, whereas options grant only the right without obligation.

B.Options are long-term instruments with maturities extending up to 15 years, while warrants always expire within 90 days.

C.Warrants are traded exclusively in the over-the-counter (OTC) market, whereas options are traded exclusively on spot markets.

D.Warrants are issued directly by the underlying company and result in share dilution upon exercise, whereas options are standardized exchange-traded contracts between third parties.

Explanation: Warrants are corporate securities issued directly by the issuing company. When they are exercised, the company issues new shares, resulting in cash inflow and equity dilution. Options are standardized exchange-traded contracts written by investors, and their exercise simply transfers existing shares between traders without diluting the company's capital.

5In the Indian financial system, what is the primary criteria used to distinguish Money Market instruments from Capital Market instruments?

A.The regulatory body, with Money Market instruments regulated by SEBI and Capital Market instruments by RBI.

B.The currency of denomination, with Money Market instruments denominated exclusively in foreign currency.

C.The maturity period of the instruments, with Money Market instruments having a maturity of up to one year.

D.The physical vs. electronic nature, with Money Market instruments issued only in physical form.

Explanation: The money market deals in short-term debt instruments with maturities of up to one year (e.g., Treasury Bills, Commercial Paper). The capital market deals in long-term debt and equity instruments with maturities exceeding one year.

6An investor or intermediary aggrieved by an order passed by the Securities and Exchange Board of India (SEBI) may file an appeal before which of the following authorities?

A.Securities Appellate Tribunal (SAT)

B.High Court of the respective state

C.Supreme Court of India directly

D.Ministry of Finance, Government of India

Explanation: The Securities Appellate Tribunal (SAT) is a statutory body established under the SEBI Act, 1992, to hear and dispose of appeals against orders passed by SEBI, the IRDAI, and PFRDA.

7Which of the following combinations of regulators has its appellate decisions reviewable by the Securities Appellate Tribunal (SAT) under the current statutory framework?

A.SEBI, CCI, and Registrar of Companies (ROC)

B.SEBI, RBI, and Ministry of Corporate Affairs

C.SEBI, FMC, and Insolvency and Bankruptcy Board of India (IBBI)

D.SEBI, IRDAI, and PFRDA

Explanation: The jurisdiction of the Securities Appellate Tribunal (SAT) has been expanded over time. It currently hears appeals against decisions of the Securities and Exchange Board of India (SEBI), the Insurance Regulatory and Development Authority of India (IRDAI), and the Pension Fund Regulatory and Development Authority (PFRDA).

8Which regulatory body has been established as the unified authority for licensing and regulating financial services, financial products, and financial institutions in the International Financial Services Centre (IFSC) in India?

A.Securities and Exchange Board of India (SEBI)

B.International Financial Services Centres Authority (IFSCA)

C.Reserve Bank of India (RBI)

D.Gift City Development Authority (GCDA)

Explanation: The International Financial Services Centres Authority (IFSCA) was established in 2020 under the IFSCA Act, 2019. It acts as the unified regulator for all financial services, products, and institutions in IFSCs in India (such as GIFT City), combining powers previously exercised by SEBI, RBI, IRDAI, and PFRDA in those zones.

9Under the Companies Act, 2013, which of the following bodies handles disputes, mergers, and corporate insolvencies for companies registered in India?

A.National Company Law Tribunal (NCLT)

B.Securities Appellate Tribunal (SAT)

C.Serious Fraud Investigation Office (SFIO)

D.Enforcement Directorate (ED)

Explanation: The National Company Law Tribunal (NCLT) is a quasi-judicial body in India that adjudicates issues relating to Indian companies, including corporate disputes, mergers, restructuring, and insolvency proceedings under the Insolvency and Bankruptcy Code (IBC).

10The Financial Intelligence Unit - India (FIU-IND), which receives and analyzes reports on suspicious financial transactions, reports directly to which of the following?

A.Governor of the Reserve Bank of India

B.Board of Directors of the Securities and Exchange Board of India

C.Economic Intelligence Council chaired by the Finance Minister

D.Director of the Serious Fraud Investigation Office

Explanation: FIU-IND is an independent body reporting directly to the Economic Intelligence Council (EIC) headed by the Union Finance Minister, Ministry of Finance.

About the NISM Series III-C Exam

The NISM Series III-C: Securities Intermediaries Compliance (Fund) Certification Examination establishes a common minimum knowledge benchmark for compliance officers and staff engaged with fund-based intermediaries, including Mutual Funds, Alternative Investment Funds (AIFs), REITs, and InvITs. It covers regulatory structures, compliance roles, SEBI Acts, insider trading, FUTP, PMLA, and specific intermediary regulations.

Questions

100 scored questions

Time Limit

2 hours

Passing Score

60%

Exam Fee

₹1,500 (NISM)

NISM Series III-C Exam Content Outline

Chapter 1: Introduction to the Financial System

Financial system structure, financial market intermediaries, and types of securities.

Chapter 2: Regulatory Framework – General View

Role of financial market regulators (SEBI, RBI, IRDAI, PFRDA) and appellate authorities.

Chapter 3: Introduction to Compliance

Meaning, significance, and role of compliance officers in financial institutions.

Chapter 4: SEBI Act, 1992

SEBI powers, functions, enforcement, and key regulatory objectives.

Chapter 5: SCRA, 1956 and SCRR, 1957

Recognized stock exchanges, listing requirements, and contract regulations.

Chapter 6: SEBI (Intermediaries) Regulations, 2008

Registration of intermediaries, fit and proper criteria, and general obligations.

Chapter 7: SEBI (Prohibition of Insider Trading) Regulations, 2015

UPSI management, Chinese walls, compliance officer duties, and trade disclosures.

Chapter 8: SEBI (Prohibition of Fraudulent and Unfair Trade Practices) Regulations, 2003

Manipulative practices, misleading statements, front running, and SEBI powers.

Chapter 9: Prevention of Money Laundering Act, 2002

Customer Due Diligence (CDD), CTR and STR reporting, and record retention.

Chapter 10: SEBI (KYC Registration Agency) Regulations, 2011

KYC ecosystem, functions of KRA, and intermediary upload obligations.

Chapter 11: SEBI (Foreign Portfolio Investors) Regulations, 2019

FPI framework, categorization, and investment limits.

Chapter 12: Foreign Exchange Management Act (FEMA)

Capital vs. current account transactions, and foreign investment reporting.

Chapter 13: SEBI (Depositories) Act, 1996

Dematerialization process, rights, and duties of depositories and DPs.

11%

Chapter 14: SEBI (Mutual Fund) Regulations, 1996

Structure of Mutual Funds, investment restrictions, and compliance.

10%

Chapter 15: SEBI (Alternative Investment Funds) Regulations, 2012

AIF categories, fundraising, investment restrictions, and compliance.

Chapter 16: SEBI (Infrastructure Investment Trusts) Regulations, 2014

Structure of InvITs, fundraising, public offer, and distribution requirements.

Chapter 17: SEBI (Real Estate Investment Trusts) Regulations, 2014

Structure of REITs, fundraising, public offer, and distribution requirements.

How to Pass the NISM Series III-C Exam

What You Need to Know

Passing score: 60%
Exam length: 100 questions
Time limit: 2 hours
Exam fee: ₹1,500

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 III-C Study Tips from Top Performers

1Dedicate significant time to Part B (Chapters 14-17), which contributes 37% of the total marks.

2Understand the key differences between REITs, InvITs, and AIF Categories I, II, and III.

3Memorize statutory timelines such as redemption payout (3 working days), dividend payout (7 working days), and KRA KYC upload (3 working days).

4Pay attention to PMLA thresholds (CTR ₹10 lakh) and reporting timelines (STR 7 working days, CTR by 15th of next month).

5Review SEBI PIT rules, including Chinese walls, connected persons, and disclosure limits (₹10 lakh within 2 trading days).

Frequently Asked Questions

What is the NISM Series III-C: Securities Intermediaries Compliance (Fund) Exam?

It is a certification exam mandated by SEBI for compliance officers of fund-based intermediaries, including Mutual Funds, AIFs, REITs, and InvITs, to verify their compliance knowledge.

What is the passing score and format of the NISM III-C exam?

The passing score is 60%. The exam consists of 100 multiple-choice questions (1 mark each) with a 2-hour duration and 25% negative marking for wrong answers.

Is there negative marking in the NISM III-C exam?

Yes, there is negative marking. Each incorrect answer attracts a penalty of 25% of the marks assigned to that question (i.e., a deduction of 0.25 marks).

100+ Free NISM Series III-C Practice Questions

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