NISM Series XVI Syllabus: Commodity Derivatives
All 10 chapters of the Commodity Derivatives workbook, with the weightage each carries in the exam.
The NISM Series XVI workbook (often searched as NISM Series 16) has 10 chapters. Two set the scene: how commodity markets work and what a commodity index is. Two are the core products: commodity futures and commodity options. One shows how they are used for hedging, speculation, arbitrage and spreads. Two cover the exchange's machinery: trading, then clearing, settlement, delivery and risk management. The last three are shorter: the legal and regulatory environment, accounting and taxation, and the code of conduct with investor protection.
Series XVI has a published weightage for every chapter. The paper is 100 questions of 1 mark each, so a chapter's weightage is also the number of marks it is worth.
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Chapter weightage
From the workbook's own syllabus outline. Weightage is out of the 100-mark paper.
| Chapter | Weightage (marks) |
|---|---|
| 1. Introduction to Commodity Markets | 10 |
| 2. Commodity Indices | 5 |
| 3. Commodity Futures | 15 |
| 4. Commodity Options | 15 |
| 5. Uses of Commodity Derivatives | 15 |
| 6. Trading Mechanism | 10 |
| 7. Clearing, Settlement and Risk Management | 15 |
| 8. Legal and Regulatory Environment | 5 |
| 9. Accounting and Taxation | 5 |
| 10. Code of Conduct and Investor Protection Measures | 5 |
| Total | 100 |
Where the marks sit
Four chapters (3, 4, 5 and 7) carry 15 marks each, 60 of the 100 between them. Chapters 1 and 6 carry 10 each. The four 5-mark chapters (2, 8, 9 and 10) add up to 20. The pass mark is 60, so even full marks on the four heavy chapters would leave no room for error: you need marks from across the paper.
What each chapter covers
Sub-headings as the March 2026 workbook lists them, grouped.
- 1. Introduction to Commodity Markets
- The history of commodity trading, spot and derivatives trading in commodities, the major commodities traded on Indian derivatives exchanges, the participants, how commodity trading compares with trading other financial assets, the commodity market ecosystem, the factors that move commodity prices, and an introduction to commodity options and index futures.
- 2. Commodity Indices
- What an index is and what a commodity index is, how an index is constructed and what goes into it, trading in commodity index futures and their uses, and trading in commodity index options.
- 3. Commodity Futures
- Futures and how they differ from forwards, cost of carry and the convergence of spot and futures prices, the fair value of a futures contract and convenience yield, the pay-off profile of futures, tick size and its impact, and spot price polling and the final settlement price.
- 4. Commodity Options
- Options and option terminology, the pay-off profiles of options, the determinants of the option premium and the option Greeks, options on commodity futures, and options on goods.
- 5. Uses of Commodity Derivatives
- Hedging and price risk management, long and short hedges with futures, speculation, arbitrage, spread trading, basis, option trading strategies, uses of index futures, and disclosure norms for hedging strategies.
- 6. Trading Mechanism
- Membership of exchanges with a commodity derivatives segment, the exchange trading system, how commodities are selected for trading and how contracts are specified, order types and conditions, tracking futures and options prices, trading costs, participants, and disclosures by exchanges.
- 7. Clearing, Settlement and Risk Management
- The clearing corporation, clearing and settlement, the delivery process, the entities involved, premium and discount, penalties for seller's and buyer's default, physical delivery, risk management, position limits and open position, risk containment measures and margining, additional procedures for other commodity products, raising the bill for delivery, and the Cyber Security and Cyber Resilience Framework (CSCRF) for stock brokers and depository participants.
- 8. Legal and Regulatory Environment
- The regulatory structure of the commodities market, the Securities Contracts (Regulation) Act, 1956, the SEBI Act, 1992, and other regulatory norms that encourage commodity derivatives.
- 9. Accounting and Taxation
- Accounting aspects of trading in commodity derivatives, the ICAI Guidance Note on accounting for derivative transactions, accounting for options contracts, and tax aspects of commodity derivatives trading.
- 10. Code of Conduct and Investor Protection Measures
- SEBI's code of conduct for brokers, risk disclosure to clients and KYC, the investor grievance redressal mechanism, the rights and obligations of members and clients, and do's and don'ts for clients and investors in commodity derivatives.
Free account, this exam preselected.
Annexures
Chapter 1 has two annexures: a list of major international commodity exchanges, and the sowing, harvesting and arrival periods of major agricultural commodities. The second is useful background for questions on what drives agricultural prices through the year.
What kind of paper this is
NISM's stated aim for Series XVI is a common minimum knowledge benchmark for approved users and sales personnel of trading members in the commodity derivatives segment. The workbook's examination objectives are to know the basics of Indian commodity derivatives markets, understand the trading strategies built with them, understand clearing, settlement, risk management and the operational mechanism, and know the regulatory environment.
This is not a recall-only paper. Chapters 3, 4 and 5 involve working with numbers: fair value through cost of carry, pay-offs, basis and hedge outcomes. The workbook notes that test centre workstations carry Microsoft Excel or LibreOffice and advises candidates to be comfortable with both for numericals.
Check the workbook version
This page follows the March 2026 workbook, which NISM says to use for the Series XVI exam taken on or after April 20, 2026. NISM revises workbooks when rules change, and the exam follows the current version. Confirm the version on NISM's Series XVI page before you start.
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