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  • CafeAlt SEBI to relax difficulty level in PMS examination for distributors

    SEBI to relax difficulty level in PMS examination for distributors

    Also, the regulator may look at relaxing some criteria like passing marks and negative marking.
    Nishant Patnaik Oct 16, 2024

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    There is good news for MFDs who want to sell PMS. SEBI is likely to relax the difficulty level in the PMS examination for distributors, said two people aware of the development.

    This has come after the trade body – the Association of Portfolio Managers in India (APMI) requested the regulator to review the existing course material due to the high failure rate, said the source.

    Also, the market regulator may also look at reducing the passing mark and doing away with the negative marking, said the sources.  

    Currently, while the passing marks is 60%, there is negative marking of 0.25% for every wrong attempt.

    According to the existing norms, distributors have to pass the NISM Series-XXI-A: Portfolio Management Services (PMS) Distributors Certification Examination to sell PMS.

    Here are some key requirements to obtain this certificate:

    • The examination consists of 80 multiple-choice questions and 3 case-based questions
    • Each question carries 1 mark while case studies can give you 20 marks
    • Passing marks to obtain this certificate is 60%
    • For every incorrect answer, there is 0.25% negative marking which means for 4 incorrect answers, 1 mark will be lost
    • The certification cost for NISM-Series-XXI-A: Portfolio Management Services (PMS) Distributors Certification Examination is Rs.1,500
    • The duration is 2 hours, and the certification is valid for three years
    Have a query or a doubt?
    Need a clarification or more information on an issue?
    Cafemutual welcomes all mutual fund and insurance related questions. So write in to us at newsdesk@cafemutual.com

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    5 Comments
    Daanik · 2 weeks ago `
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    AMOL FAYE · 2 weeks ago `
    Hi,
    PMS is the product crafted for HNI clients, as per their risk return & liquidity suitability by analysing the risk profile.
    Hence, those who would like to distribute such high level ticket size product, should have a good knowledge of the product to define IPS to clients as GIPS. Where as in reality most of them are depends on AMC's RM, ICs & portfolio managers. Even they r not able to explain regarding charges & fees calculation metod to client.
    Hence, existing PMS syllabus & passing criteria is very basic so there is no need to change it.
    Instead of this, SEBI can reduce the ticket size to increase the penetration cos i
    AMOL FAYE · 2 weeks ago `
    Continue...

    Cos due to high ticket size clients are afraid to start investing into PMS. Where as MF investing is starting with 2000/-@ month SIP & 5000/- lumsum. But still as of 2024, around 8% - 9% of the population of India invests in mutual funds. This is a small percentage compared to the other developing countries. Out of these I think very little percentage are investing into PMS.
    So requesting SEBI to reduce the ticket size along with if possible fees & charges too to increase penetration.
    AMOL FAYE · 2 weeks ago `
    Continue...

    Cos due to high ticket size clients are afraid to start investing into PMS. Where as MF investing is starting with 2000/-@ month SIP & 5000/- lumsum. But still as of 2024, around 8% - 9% of the population of India invests in mutual funds. This is a small percentage compared to the other developing countries. Out of these I think very little percentage are investing into PMS.
    So requesting SEBI to reduce the ticket size along with if possible fees & charges too to increase penetration.
    Amiya Raut · 2 days ago `
    Can a MF distributor distribute PMS/AIF without any further certification?
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