Securities Professional Exam Requirements.
It is required that all NEW representatives take and pass the Securities Industry Essentials® (SIE®) Exam as a pre-requisite to taking the Series 7 Exam. The FINRA Series 7 is a corequisite exam that needs to be successfully completed in addition to the Series 63, 65, or 66 exam before a candidate can apply to register with a state. As individuals, we understand different people have different needs and we can also accomodate individual sessions focusing and targeting on "problem areas" to position our students to pass the exams on the first attempt.
- Securities Industry Essentials® (SIE®) Exam
- Series 7 – General Securities Representative Exam
| Exam | Questions | Allotted Exam Time | Required To Pass |
|---|---|---|---|
| SIE | 75 Multiple-Choice Questions | 1 hour and 45 minutes | 70% |
| S7 | 125 Multiple-Choice Questions | 3 hours and 45 minutes | 72% |
After passing the SIE and Series 7 Exam, representatives must also pass at least ONE of the following Securities Law Exams in order to be registered to conduct business in any State, and must be approved in their home state.
- Series 63 – Uniform Securities Agent State Law Exam
- Series 65 – Uniform Investment Adviser Law Exam
- Series 66 – Uniform Combined State Law Exam
** The Series 66 exam is the equivalent of taking both the Series 63 and Series 65 exams.
| Exam | Questions | Allotted Exam Time | Required To Pass |
|---|---|---|---|
| S63 | 60 Multiple-Choice Questions | 1 hour and 15 minutes | 72% |
| S66 | 100 Multiple-Choice Questions | 1 hour and 50 minutes | 73% |
| S65 | 130 Multiple-Choice Questions | 3 hours | 70% |
The Series 7 Exam covers a wide range of topics, so dedicating time and effort to each section while practicing with sample questions and exams is crucial for success. It is also required that new representatives also take and pass the Securities Industry Essentials® (SIE®) Exam prior to taking the Series 7 Exam.
The SIE is open to anyone aged 18 or older, including students and prospective candidates interested in demonstrating basic industry knowledge to prospective employers. Association with a firm is not required to take the SIE, and results are valid for four years.
| Section | Description | Questions | Weight |
|---|---|---|---|
| 1 | Knowledge of Capital Markets | 12 | 16% |
| 2 | Products and Their Risks | 33 | 44% |
| 3 | Trading, Customer Accounts and Prohibited Activities | 23 | 31% |
| 4 | Regulatory Framework | 7 | 9% |
| Total | 75 | 100% |
The exam is administered via computer. Each candidate’s exam includes 10 additional, unidentified pretest items that do not contribute toward the candidate's score. There is no penalty for guessing. Therefore, candidates should attempt to answer all items. Candidates will be allowed 1 hour and 45 minutes to complete the SIE exam. All candidate test scores are placed on a common scale using a statistical adjustment process known as equating. Equating scores to a common scale accounts for the slight variations in difficulty that may exist among the different sets of exam items that candidates receive. This allows for a fair comparison of scores and ensures that every candidate is held to the same passing standard regardless of which set of exam items they received. Candidates are not permitted to bring reference materials to their testing session. Severe penalties are imposed on candidates who cheat or attempt to cheat on FINRA-administered exams.
The exam consists of 125 multiple-choice items, and each item consists of four answer choices. The allocation of exam items for each major function is as referenced in the table below.
| Section | Description | Questions | Weight |
|---|---|---|---|
| 1 | Customers and Potential Customers | 9 | 7% |
| 2 | Financial Profilea and Investment Objectives | 11 | 9% |
| 3 | Suitability, Disclosure, and Record Keeping | 91 | 73% |
| 4 | Customer Instructions, Transactions, and Agreements | 14 | 11% |
| Total | 125 | 100% |
This course has been designed using the following Modules and sections which include practice Q&A for each part. Each Module and Section are followed by practice questions, and we'll be closing out with full-blown exams. As individuals, we understand different people have specific needs and we can also accomodate individual sessions focusing and targeting on "problem areas" to help better position our students to pass the exams.
I. Introduction to Securities Industry and Regulations
A. Overview of the Securities Industry.
B. Role of FINRA and SEC.
C. Securities Act of 1933.
D. Securities Exchange Act of 1934.
II. Securities Markets and Products
A. Types of Securities.
- Equities.
- Fixed-Income Securities.
- Options.
- Mutual Funds.
- Alternative Investments.
B. Primary Markets.
C. Secondary Markets.
D. Orders.
- Market Orders.
- Limit Orders.
- Stop Orders.
III. Investment Risk and Return
A. Risk vs. Return.
B. Diversification and Portfolio Allocation.
C. Investment Strategies.
- Growth Investing Strategies.
- Value Investing Strategies.
- Active Investing Strategies.
- Passive Investing Strategies.
IV. Investment Banking and Corporate Securities
A. Capital Structure.
B. IPOs and Secondary Offerings.
C. Underwriting Process.
V. Regulations and Compliance
A. Registration and Licensing Requirements.
B. Anti-Money Laundering (AML) Regulations.
C. Know Your Customer (KYC) Requirements.
VI. Customer Accounts and Investment Strategies
A. Account Types.
- Individual.
- Joint.
- Corporate.
- Trusts.
B. Investment Strategies based on Client Objectives.
C. Tax Considerations in Investment Planning.
VII. Derivative Securities and Options
A. Options Strategies.
B. Option Contracts and Exchanges.
C. Risk Management using Derivatives.
VIII. Retirement Plans and Regulations
A. Types of Retirement Plans.
- IRA.
- 401(k).
- Pension Plans.
B. ERISA Matters.
IX. Securities Analysis and Valuation
A. Fundamental Analysis.
B. Technical Analysis.
C. Valuation Methods.
X. Ethics and Professional Conduct
A. Ethical Guidelines for Financial Professionals.
B. Insider Trading and Market Manipulation.
C. Conflicts of Interest and Fiduciary Responsibilities.
XI. Practice Exams and Quizzes
A. Mock Exams for Practice.
B. Study Tips and Exam Strategies
XII. Individual Group Assessment
A. Target Individual Problem Areas and Sections as a Group.