If one wishes to pursue a career in stockbroking in India, giving the authorized person exam is essential. This exam serves as a crucial milestone for anybody looking to join the stockbroking industry. On a stock market, investors and traders sell or purchase securities, commodities, stocks, bonds, and more. To aid them in this process, there exists a slew of financial service agents known as stockbrokers. These individuals can also be known as depository participants. Through their depository participants, clients are guided about the market as well as the sale of securities on it. There also exist a variety of authorized persons who partner with stockbrokers at the geographical level.
Not only does a stock broker have to possess strong customer service skills but they also need to be a fast thinker to truly stand out among her contemporary contenders in the industry. Using meticulous analyses, it is necessary for the stockbroker to consistently monitor the stock market. Hence, authorized persons in stockbroking industries play a crucial role in providing investment products and services to their clients. In order to be able to practice as a authorized person in India, an individual will need to clear the authorized person exam. After this is cleared, the individual can perform a slew of functions such as handling their clients’ portfolios, executing trades, providing assistance to clients’ investments and trading, and others.
Based on the different types of exams for authorized person that exist, different material needs to be prepared. These types and what is to be prepared for them are detailed below as follows.
NISM-Series-XI exam Preparation:
This type of team is voluntary and also referred to as the Equity Sales Certification Examination. To prepare for this examination, one needs to study the Indian equity market thoroughly including its returns, risks, and any taxes that are related to it. One should also have clarity regarding any concepts such as risk management, settlement, and clearing, especially during the operational processes of the equity market. If one is able to clear this exam, it will showcase that you possess a powerful understanding of the operations of the Indian equity market. For those who currently do not have a good grasp of this market, it’s vital to study this thoroughly to obtain this certificate.
NISM-Series-VIII exam Preparation:
This is also known as the Equity Derivatives Certification Examination. This type of exam gauges an individual’s knowledge when it comes to being the approved user for a trading member as well as a sales personnel in the Indian equity derivative segment. To prepare for this exam, you will be mandated to study the different derivative products that have been offered by the derivative markets. You should also prepare to know about risks and regulations associated with them, in addition to the mechanism for the exchange of clearing and settlement. It is also necessary for individuals to prepare about the regulations and rules that enable the Indian securities market to operate. Finally, another key preparation is regarding the different strategies that you can create using futures and options on the stock indices.
Key Things to Know Before Giving Authorized Person Exam
A authorized person’s main function is to offer individuals the right suggestions about the selling and buying of stocks to their clients so that they can make the most of their market investments. Hence, having the correct and updated understanding of the inner workings of the stock market is vital. It is also important to consider the political impact on the stock market, as well as the effect of the world’s economy on it, and other aspects that impact the stock market’s performance.
A potential authorized person should realize the direction in which a particular stock or market will head due to the decisions that are made by any company or government. Only with this understanding can one offer the right trading and investing suggestions to one’s clients. The better you are, the more likely you’ll retain clients for longer. It is also essential, as a authorized person, to possess basic knowledge when it comes to using a computer so one can have an existing client base.
The Bottom line
As a authorized person one should have sufficient knowledge of the stock market as well as its operations. Likewise, the ways to prepare for the different authorized person exams, as detailed above, can help you qualify. Once cleared, you can get started on your journey.