NISM Series I Currency Derivatives
Praveen Dubey (SEBI Registered RA)
SP RESEARCHVIA PVT. LTD. (INH000015808)
NISM Series I: Currency Derivatives — For India's Forex Market Professionals
The NISM Series I: Currency Derivatives Certification Examination is mandatory for approved users and sales personnel of trading members of NSE, BSE, and MSEI currency derivative segments. India's currency derivatives market, launched in 2008, allows hedging and speculation on USD/INR, EUR/INR, GBP/INR, and JPY/INR currency pairs through exchange-traded futures and options.
Exam Structure
Duration: 2 hours. Questions: 100 MCQs. Passing Marks: 60%. Negative Marking: 25%. Fees: ₹1,500 + GST. Validity: 3 years.
Key Syllabus Areas
Exchange Rates & Forex Markets (20%): Spot rates, forward rates, cross currency rates, factors affecting exchange rates — RBI policy, inflation differential, current account deficit, FII flows. Currency Futures (25%): Pricing of currency futures, basis risk, rollover strategy, hedging importers and exporters. Currency Options (25%): Call and put options on USD/INR, payoffs, option pricing models, Greeks. Clearing & Settlement (15%): Cash-settled vs delivery-based settlement, margin requirements. Regulatory Framework (15%): RBI & SEBI guidelines on currency derivatives, position limits for different participant categories.
Practical Application: Hedging with Currency Futures
An importer expecting to pay $1 million in 3 months can buy USD/INR futures to lock in the exchange rate and protect against rupee depreciation. Conversely, an exporter expecting to receive foreign currency can sell USD/INR futures to protect against rupee appreciation. Understanding these real-world applications is essential for both the exam and for advising corporate clients.
Regulatory Statutory Warning & Disclaimers
Investment in the securities market is subject to market risks. Read all the related documents carefully before investing. Registration granted by SEBI, and certification from NISM in no way guarantee performance of the intermediary or provide any assurance of returns to investors.
Written by Praveen Dubey
Chief Research Analyst | SEBI Reg: INH000015808
Statutory Warning & Risk Disclaimer: Investment in securities market is subject to market risks. Read all related documents carefully before investing. Registration granted by SEBI and certification from NISM in no way guarantee performance of the intermediary or provide any assurance of returns to investors. Content provided on this blog is for informational and educational purposes only.