NISM 5A Mock Test 2026 - Pass Mutual Fund Distributors Exam in One Attempt

NISM Series V-A — Mutual Fund Distributors — is the most-taken NISM certification in India and the gateway to your AMFI Registration Number (ARN). The fastest way to gauge whether you are exam-ready is to work through real, exam-style mock questions and check whether the underlying concept clicks. This post breaks down the highest-yield questions from a fresh 2026 V-A mock test and turns each into a reusable rule.

At a glance: 100 questions, 2 hours, 50% pass mark, 0.25 negative marking, ₹1,500 + GST. Conducted at NISM-empanelled centres across India and online via remote proctoring.

If you want the full study schedule first, start with our week-by-week guide to passing NISM V-A and then come back to drill these questions.

Taxation — the questions everyone gets wrong

Taxation carries few marks but trips up the most candidates, because the rules change often. Lock these down:

• STT (Securities Transaction Tax) applies only to equity-oriented funds. On sale of equity MF units through the exchange, STT is 0.1%; on redemption through the fund it is 0.001%. It is never charged on debt funds or fixed maturity plans (FMPs).
• Mutual funds themselves are exempt from income tax — they are structured as trusts for the benefit of unit holders. The investor is taxed, not the fund.
• TDS on capital gains is not deducted for resident individuals, but is deducted at 10% for non-resident investors (NRIs).
• Indexation adjusts the cost of acquisition upwards for inflation, reducing the taxable gain. Note that post-23-July-2024 (Finance No. 2 Act 2024), indexation was removed for non-equity funds, equity LTCG is 12.5% above the ₹1.25 lakh exemption, and equity STCG is 20%.

Exam tip: Whenever a question pairs “STT” with “debt”, the answer is almost always “not applicable.” Memorise that single fact and you bank easy marks.

For the complete updated rates, see our LTCG / STCG rules after Finance Act 2024 guide.

Documents and disclosures

Several questions test whether you can tell the scheme documents apart:

• SID (Scheme Information Document): detailed scheme info — investment objective, risk factors, NFO dates, asset allocation. If a question asks where to read general risk factors or NFO dates, the answer is SID.
• SAI (Statement of Additional Information): statutory information — rights of unit holders, investment valuation norms, transmission procedure. SIP returns are not here.
• KIM (Key Information Memorandum): a summary of both SID and SAI. It carries the fund manager, trustee, scheme performance, and asset allocation in a simplified format.
• Fund Fact Sheet: holds SIP returns and performance metrics.

Other document rules worth memorising:

1. SEBI does not approve scheme documents — it issues observations that the fund must incorporate.
2. The trustees ensure scheme documents comply with regulations, and any opening of the time-stamping machine must be reported to the trustees.
3. A company can invest only if its Memorandum and Articles of Association permit it — a board resolution alone is not sufficient.

Operations, NAV and cut-off timings

• Cut-off timings are prescribed by SEBI and are uniform across all AMCs — never decided AMC-to-AMC.
• For a liquid fund application made after the 1:30 pm cut-off, the NAV of the previous business day (the day preceding the day funds are available) applies.
• Investments in a portfolio are carried at market value, NAV for index/liquid/debt funds is declared to four decimal places, and investors can hold fractional units.
• Direct plans levy no transaction charges — a ₹25,000 direct investment is invested in full.
• A wrongly mentioned ARN is processed as a regular plan; if corrected within 30 days, it can be reprocessed under the correct plan.

At a glance: Unit certificates must be issued within 5 working days; repurchase proceeds dispatched within 10 working days; every scheme must have a minimum of 20 investors; the sponsor must contribute at least 40% of the AMC’s net worth.

Performance metrics

The “calculation-looking” questions are simpler than they appear:

• Sharpe ratio = (return − risk-free rate) ÷ standard deviation. The denominator is standard deviation, not beta.
• Treynor ratio uses beta as the denominator instead.
• Alpha is the difference between a fund’s actual and expected (CAPM) return. Positive alpha = outperformance; negative alpha = underperformance.
• Jensen’s Alpha measures outperformance after adjusting for risk taken.
• Tracking error is the right measure for how closely an index fund follows its benchmark.

Master these five and you cover most of the “Risk, Return & Performance” weightage.

Distribution, compliance and conduct

• Distributors are compensated primarily through commissions (upfront or trail), based on funds mobilised.
• Employees of an AMC cannot become distributors (conflict of interest), and AMFI’s code of conduct bars negative statements about any AMC or scheme.
• KYC Registration Agencies (KRAs) maintain the uniform KYC process.
• Due diligence is mandatory for distributors receiving over ₹50 lakh in commission from a single mutual fund.
• A credit card is not accepted as photo ID for micro-SIP, because it may not be backed by a bank account.
• An investor can change their distributor anytime via written request — no NOC from the existing distributor is needed.

How to use these questions

Reading answers is not the same as scoring them under pressure. Build the habit:

1. Attempt a full 100-question mock with a 2-hour timer and 0.25 negative marking applied.
2. Review every wrong answer and write the underlying rule in one line.
3. Repeat until you cross 75% on three consecutive mocks.

For 25 more worked examples in the same style, see our NISM V-A mock test 2025 explainer.

Practise with the NISM Exam Prep app

Our NISM Exam Prep app covers all 31 NISM exams with 13,000+ practice questions, including a deep V-A bank with full-length 100-question mocks that apply accurate 0.25 negative marking. Try the free V-A quiz to benchmark yourself right now.

Then sharpen the numeric questions with our 20 finance calculators — SIP, lumpsum, XIRR, Sharpe and more — and revise the tax and document rules above using the quick reference guides, kept current for FY 2025-26. Work the questions, learn the rule behind each one, and one attempt is all you will need.