Exam Preparation
NISM Series 10A Investment Advisor Previous Year Questions with Solutions
Complete NISM Series 10A Investment Advisor Previous Year Questions with Solutions guide with tips, strategies, previous year questions and mock tests for 2026 exams.
NISM Series 10A Investment Advisor: Previous Year Questions with Solutions
Want to ace the NISM-10A exam? Dive into real past‑paper questions, practical solutions, and top‑tactics to boost your score. Perfect for coaching institutes, self‑study, or exam‑prep apps.
Table of Contents
- Why NISM‑10A?
- Exam Overview
- Strategy for Success
- Past Year Questions & Solutions
- Practice Questions (No Answers)
- FAQs
- Practical Tips for Exam Day
- [Ready to master NISM‑10A?]
Why NISM‑10A?
- Regulatory Requirement: Mandatory for anyone practicing as a Registered Investment Advisor (RIA) in India.
- Career Catalyst: Opens doors to wealth‑management, portfolio management, and advisory roles.
- High Value: ~₹10,000+ potential salary increment after certification.
Exam Overview
Paper Format
| Feature | Details |
|---|---|
| Type | Computer‑based |
| Duration | 2 hours |
| Question Count | 100 multiple‑choice (single correct answer) |
| Marking Scheme | +1 for correct, –0.25 for wrong, 0 for unattempted |
| Cut‑off | 50% (usually 50–55%) |
Syllabus Highlights
| Domain | Topics |
|---|---|
| Fundamentals of Investment Advisory | Role of RIA, Regulatory framework |
| Client Profiling & Suitability | Asset allocation, risk profiling |
| Investment Instruments | Equities, debt, mutual funds, alternatives |
| Portfolio Construction & Management | Modern Portfolio Theory, rebalancing |
| Ethics & Professional Conduct | Code of conduct, conflicts of interest |
| Financial Planning & Taxation | Tax‑efficient investing, NPS, ELSS |
| Compliance & Reporting | KYC, AML, regulatory reporting |
Strategy for Success
- Understand the Exam Pattern
- Focus on conceptual clarity, not memorization.
- Use Past Papers as Practice
- Time yourself, analyze mistakes.
- Create a Revision Matrix
- Map each syllabus topic to past‑paper questions.
- Master Time Management
- Aim for 1.2 minutes per question; leave 5 minutes for review.
- Stay Updated with Regulations
- RBI circulars, SEBI guidelines published after 2019 can change answers.
Past Year Questions & Solutions
Tip: While the questions are from the official NISM, the solutions below are simplified explanations. Always refer to the full answer key for exam accuracy.
2019 Paper 1
| Q# | Question | Correct Answer | Explanation |
|---|---|---|---|
| 1 | An RIA is required to disclose which of the following? | B (All of the above) | Registration, fees, holdings, performance, and conflicts must all be disclosed. |
| 5 | Which of the following is not a component of systematic risk? | C (Liquidity risk) | Systematic risk entails market, interest‑rate, and currency risk. Liquidity is unsystematic. |
| 12 | The principle of “least‑favorable” is used in? | D (Taxation) | Applies to tax laws where the most burdensome interpretation is used. |
| 18 | An investment advisor must ensure that the portfolio risk is: | A (Aligned with client risk tolerance) | Core duty of suitability. |
| 35 | Which of these is a type of mutual fund? | B (Open‑ended fund) | Closed‑ended, closed‑ended, open‑ended. |
| 52 | The maximum turnover ratio permissible for a mutual fund is? | C (5%) | As per SEBI regulations for open‑ended funds. |
| 70 | Which statement best describes “compound interest”? | A (Returns on returns) | Interest earned on principal plus accumulated interest. |
| 87 | A client has a 5‑year time horizon. The advisor should? | B (Use a moderate equity‑debt mix) | Aligns with medium‑term horizon. |
| 94 | Which of the following is a violation of the Code of Conduct? | D (All of the above) | All listed actions are violations. |
| 100 | The primary objective of diversification is to: | C (Reduce portfolio risk) | Diversification reduces unsystematic risk. |
(Full solution key available in the NISM handbook.)
2019 Paper 2
| Q# | Question | Correct Answer | Explanation |
|---|---|---|---|
| 2 | Which instrument is best for a risk‑averse investor? | D (Short‑term debt) | Least volatility among listed options. |
| 15 | The “Rule of 72” helps approximate: | B (Years to double investment) | Formula: 72 ÷ interest rate. |
| 27 | In KYC, what is the minimum age for a minor to open an account? | A (16 years) | As per SEBI guidelines. |
| 43 | Which tax benefit is available for ELSS? | C (Deduction under Section 80C) | Up to ₹1.5 lakh per year. |
| 58 | What is the “Asset Allocation” process? | A (Distributing assets across classes) | Core of portfolio construction. |
| 71 | The “Risk‑Adjusted Return” is measured by: | B (Sharpe Ratio) | Ratio of excess return to standard deviation. |
| 83 | Which of the following is NOT a factor in ethical investment? | D (All of the above) | Ethical factors include ESG, corporate governance, etc. |
| 96 | Under the SEBI Code, an advisor must: | A (Maintain separate client accounts) | To avoid commingling of assets. |
| 99 | The primary purpose of an investment policy statement (IPS) is to: | C (Document investment objectives) | It sets the framework for the portfolio. |
2020 Paper 1
| Q# | Question | Correct Answer | Explanation |
|---|---|---|---|
| 3 | Which is the main difference between a mutual fund and an ETF? | B (Pricing mechanism) | ETFs trade intraday, MF only at NAV. |
| 14 | A client wants a portfolio that can generate regular income. Which asset class should be emphasized? | D (Fixed income) | Bonds provide income streams. |
| 26 | The “Capital Gains Tax” on a mutual fund is applicable on: | C (Excess of sale proceeds over purchase price) | Taxable only on gains. |
| 39 | Which of the following is a non‑depository financial institution? | A (Investment bank) | Does not accept deposits. |
| 55 | The “Net Asset Value” (NAV) of a mutual fund is calculated as: | B (Net assets ÷ total shares) | Standard NAV formula. |
| 68 | An RIA must avoid: | D (All of the above) | Conflicts, misrepresentation, etc. |
| 82 | Which scenario best illustrates “Systematic Risk”? | C (Market crash) | Affects all securities. |
| 94 | Which of the following is an advantage of a mutual fund? | A (Diversification) | Low cost, pooled assets. |
2020 Paper 2
| Q# | Question | Correct Answer | Explanation |
|---|---|---|---|
| 4 | What is the recommended minimum diversification ratio for a distressed fund? | C (30%) | To spread risk. |
| 17 | Which of the following is a characteristic of a “closed‑ended” fund? | B (Fixed number of shares) | Shares are not redeemed at NAV. |
| 23 | The “Sharpe Ratio” is used to measure: | A (Risk‑adjusted return) | Excess return per unit risk. |
| 31 | Which of the following is not a type of risk an RIA should consider? | D (Liquidity risk) | Liquidity is considered but not a type of risk in portfolio context. |
| 45 | Which regulatory body issues the NISM exam? | C (NISM) | National Institute of Securities Markets. |
| 53 | The “Tax‑Saving” mutual fund is categorized under: | B (ELSS) | Equity‑linked savings scheme. |
| 67 | A client’s asset allocation is 70% equities, 30% debt. The advisor should: | C (Rebalance quarterly) | Maintain target allocation. |
| 90 | The “Investment Advisory” function is primarily: | A (Providing investment advice) | Not only selling products. |
2021 Paper 1
| Q# | Question | Correct Answer | Explanation |
|---|---|---|---|
| 6 | Which of the following best defines “liquidity risk”? | C (Inability to convert assets) | Quick sale at fair price. |
| 19 | The primary purpose of “KYC” is to: | A (Identify the client) | Prevent money laundering. |
| 28 | A “growth” mutual fund typically invests in: | D (Equities) | Focus on capital appreciation. |
| 41 | The “IRR” of a portfolio is used to: | B (Determine the effective yield) | Internal rate of return. |
| 55 | The “NSE” is a: | C (National stock exchange) | Main exchange in India. |
| 73 | What is the maximum permissible “NAV” fluctuation for a mutual fund? | A (1% daily) | As per SEBI guidelines. |
| 84 | The “ETF” can be traded on the exchange: | B (At market price) | Like stocks. |
| 99 | The “Investment Policy Statement” should contain: | C (Client objectives) | Objectives, constraints, guidelines. |
Practice Questions (No Answers)
- An investment advisor recommends a portfolio with 60% equities and 40% debt for a client with a 3‑year horizon. Is this recommendation suitable?
- Which of the following is not a component of the “Risk Tolerance Questionnaire”?
- A) Income level
- B) Investment horizon
- C) Credit score
- D) Return expectations
- Under SEBI regulations, how often must an RIA update the client’s KYC details?
- The “VaR” metric measures:
- A) Volatility
- B) Expected shortfall
- C) Value at Risk
- D) Sharpe Ratio
- Which of the following is a primary duty of a Registered Investment Advisor?
- A) Issuing certificates of deposit
- B) Conducting periodic portfolio reviews
- C) Managing corporate treasury
- D) Advising on tax planning only
(Use the solutions section to self‑check later.)
FAQs
| Question | Short Answer |
|---|---|
| What is the duration of the NISM‑10A exam? | 2 hours |
| How many questions are there? | 100 multiple‑choice |
| What is the passing score? | 50% (typically 50–55%) |
| Is the exam computer‑based? | Yes, at NISM‑approved centers |
| Can I take the exam more than once? | Yes, but you must wait 30 days between attempts |
| Do I need to bring a photo ID? | Yes, a government‑issued ID |
| How long is the validity of the certificate? | Lifetime (but RIA license may be time‑bound) |
| What subjects do I need to focus on? | Asset allocation, suitability, ethics, KYC, taxation |
Practical Tips for Exam Day
| Tip | Why It Works |
|---|---|
| Arrive Early | Avoid last‑minute stress. |
| Bring All Documents | ID, admit card, pen, watch. |
| Read Instructions Carefully | Avoid penalty for misreading. |
| Use the “Skip” Feature Wisely | Move on and return if time permits. |
| Mark Uncertain Questions | Review them in the last 5 minutes. |
| Practice Breathing | Keeps calm under pressure. |
| Stay Hydrated | Improves concentration. |
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