Financial Securities Examinations Summarized


choosing investments
There are a numerous of special exams and permits that one must obtain in order to have the authority to sell specific types of securities and provide associated consultation services.  Have you ever wondered which financial exam you are going to need in order to carry out your future business plans, but have been overwhelmed by the volume of information?

This document presents a short summary of the purpose and contents of every classification of financial securities examination, divided into two categories.

The U.S. Financial Industry Regulatory Authority (FINRA) divides its exams into the two categories of:

Registered Representative

Registered Principal

The Registered Principal Exams are summarized in a separate document.

Registered Representative Level

Series 3 – National Commodity Futures Exam*

The Series 3 (NFA) financial exam is given to individuals wishing to sell commodities or futures contracts. The act of registering with the NFA also requires taking this exam. If registering with the National Futures Association it is also required to take this exam.

Series 5 – Interest Rate Options Exam

This test is given to individuals who intend to sell, trade, or supervise the sale of GNMA and US government interest rate option contracts.  Other possible qualifying tests include the Series 4 or 7.

 Series 6 – Investment Company and Variable Contracts Exam (Mutual Funds/Variable Annuities)

The Series 6 (FINRA) financial exam is to candidates who wish to function as a principal for the purchase, sale, or solicitation of redeemable securities and any contracts issued by an insurance company including insurance premium funding programs and variable contracts.

Series 7 – General Securities Representative Exam (Stockbroker)

The Series 7 (FINRA) financial exam is given to qualify an individual to sell, purchase and solicit all securities including municipal fund securities, options, variable contracts, direct participation programs, corporate securities, municipal securities, and investment company products.

Series 11 – Assistant Representative – Order Processing

The Series 11 (FINRA) financial exam is given to those  who are associated with a member that accepts unsolicited customer orders for submission for execution.  Those who  can accept unsolicited customer orders,  are not qualified to take orders for direct participation programs or municipal securities until they pass the Series 11.

investing time

Series 15 – Foreign Currency Options Exam

No information is available here

Series 17 – Limited Representative (FSA registration)

The Series 17 examination is an “add-on” test to the British securities license. Passing it gives an individual the equivalent of the U.S. Series 7 General Securities license without duplicating material already covered in the British exam.  Any such associated persons registered and in good standing with the Financial Services Authority (FSA) in the UK are eligible to take this abbreviated exam.

In order to  sell municipal bonds in the U.S, either  either the Series 7  or Series 52 exam must be passed.  US  Municipal bonds are not covered by the Series 17.

 Series 22 – Direct Participation (Limited partnerships) Exam

The Series 22 financial exam is given to enable the candidate to function as a principal for the purchase, sale, or solicitation of programs that provide for flow-through tax consequences.  Such programs include S corporation offerings, oil and gas programs, and real estate programs.

Series 30 – Futures – Branch Office Manager Exam*

Antone who would operate as a branch manager must pass this or an equivalent appropriate examination.  Those  sponsored by a firm that is dually registered as a broker-dealer,  may substitute e Series 8, 9, 10 or 24.  if the sponsor is not dually registered, the candidate  must pass the Series 30 exam. Designated security futures principals for notice-registered broker-dealers must also pass the Series 30 exam.

Series 31 – Futures – Managed Funds Exam*

The Series 31 (FINRA) financial exam is given to satisft requirements of the The National Futures Association.  They  require the completion of this exam, which qualifies an individual to run a firm’s managed futures and commodities trading funds and supervise the firm’s employees in these activities.

Series 32 – Futures Exam – United Kingdom Representatives*

The Limited Futures Examination – Regulations (Series 32) is offered to individuals who are registered by regulatory authorities in jurisdictions outside the United States where the NFA has determined that proficiency requirements are similar to its own. Currently only the UK and Canada are recognized. Individuals may qualify for the Series 32 if, within the two years prior to filing the application, they have been registered or licensed in the UK or Canada. The Series 32 is an abridged exam encompassing regulation portion of the Series 3 exam.

 Series 37 – Canadian Module of the General Securities Exam

Properly registered individuals in Canada may be eligible to act as a General Securities Representative in the United States (U.S.) by obtaining the Canada Module of the General Securities Registered Representative (CD) or (CN) registration. These registrations are obtained by meeting certain criteria, outlined below, and by passing either the Series 37 or 38 examinations. The CD and CN registrations allow individuals to engage in activities similar to a General Securities Representative (GS) without having to sit for the Series 7 examination. However, such registration does not permit persons to conduct business in municipal securities.

 Series 38 – Canadian Module of the General Securities Exam

See series 37

Series 42 – Registered Options Representative Exam

The Registered Options Representative exam, or Series 42 exam, is both created and administered by FINRA. This exam is designed to test the knowledge of those individuals who wish to become licensed options representatives for a FINRA firm.

 Series 44 – NYSE Arca Options Market Maker Exam

NYSE Arca Options offers the best on-screen liquidity of any US options exchange.  NYSE Arca is at the National Best Bid or Offer (NBBO) more often than any other exchange.

money market volitility

 

 

 

 

Series 47 – Japanese Module of the General Securities Exam

Don’t worry about it unless you work for a bank in Japan!

 Series 52 – Municipal Securities Representative Exam

An exam offered by the Financial Industry Regulatory Authority (FINRA) and overseen by the Municipal Securities Rulemaking Board (MSRB). The Series 52 qualifies a financial professional to become a licensed municipal securities representative. People who obtain this certification can sell municipal securities such as municipal bonds, agency bonds and Section 529 plans for college education.

 Series 55 – Equity Trader – Limited Representative Exam

The Series 55 Examination is designed to assess the competency of entry-level Equity Traders. It is intended to safeguard the investing public by helping to ensure that Equity Traders are competent to perform their jobs. Given this purpose, the Series 55 Examination seeks to measure the degree to which each candidate possesses the knowledge, skills and abilities needed to perform the critical functions of an Equity Trader.

Series 56 – Proprietary Trader Qualification Exam

The Proprietary Traders Qualification Examination (Series 56) is designed to test a candidate’s knowledge of applicable products, securities markets, trading and reporting practices, investment strategies, and anti-fraud provisions as applicable to the role of a proprietary trader.

Series 62 – Corporate Securities – Limited Representative Exam

Series 62 is an exam administered by the Financial Industry Regulatory Authority (FINRA) for financial professionals seeking to become limited registered representatives for corporate equities and corporate debt securities. It tests an individual’s knowledge of corporate equity and bond markets, security analysis and characteristics, industry regulations, and the handling of customer accounts.

 Series 63 – Uniform Securities Agent State Law Exam*

The Uniform Securities Agent State Law Examination was developed by NASAA in cooperation with representatives of the securities industry and industry associations. The examination, called the Series 63 exam, is designed to qualify candidates as securities agents. The examination covers the principles of state securities regulation reflected in the Uniform Securities Act (with the amendments adopted by NASAA and rules prohibiting dishonest and unethical business practices). The examination is intended to provide a basis for state securities administrators to determine an applicant’s knowledge and understanding of state law and regulations.

Series 65 – Uniform Registered Investment Adviser Law Exam (RIA)*

investment growthWho needs to take the Series 65 examination? In order for an individual to register and serve as an investment adviser representative (also known as an “IAR”) of a registered investment advisory firm (also known as an “RIA”), most state securities regulators require the individual to successfully complete the Uniform Investment Adviser Law Examination (also and more commonly referred to as the “Series 65 examination”). As discussed below, state securities regulators have certain exceptions or alternatives to the general requirement that a prospective investment advisor representative has successfully completed the Series 65 examination prior to submitting his or her registration application (the “Form U4”). Some state securities regulators also accept other professional designations in addition to those listed above as an alternative to the Series 6

 Series 66 – Uniform Investment Adviser – Combined State Laws Exam (Combined 63 and 65)

Series 72 – Government Securities – Limited Representative

Series 72 is an exam administered by the Financial Industry Regulatory Authority (FINRA) for individuals seeking to become government securities limited representatives for registered broker/dealers. Series 72 license holders can sell government bonds and certain agency bonds such as GNMA securities and Federal Home Loan Mortgage (Freddie Mac) securities.

 Series 79 – Investment Banking Exam

The Series 79 exam is for those looking to work in the area of investment banking. Before 2009 the more popular exam (the Series 7) was required to be a general broker, but some representatives found they were only performing investment banking activities, which is only a small portion of the Series 7 exam. Retail securities firms provide a different set of functions and services than investment bankers, so the Series 7 testing material covered topics beyond the duties of most investment bankers. Because of these concerns, a job analysis was conducted and a committee of investment bankers agreed on the major duties, job functions and tasks associated with this investment banking. In 2009 the Securities and Exchange Commission (SEC) approved the more focused, Investment Banking Representative Qualification Examination (Series 79). This exam is also referred to as the “Limited Representative” Investment Bankers’s exam because it was designed for entry level investment bankers.

Series 82 – Private Securities Offerings – Limited Representative
Definition of ‘Series 82′

Series 82 is an exam administered by the Financial Industry Regulatory Authority (FINRA) for individuals seeking to become private securities offering representatives. A person who passes the Series 82 can only offer private placement offering on original issues. These securities are sold to private investors (often institutional funds like pensions or mutual funds) directly, rather than to the public as with an IPO.

Series 86 – Research Analyst – Securities Analysis

Series 86 is an exam administered by the Financial Industry Regulatory Authority (FINRA) and otherwise known as the Research Analyst Qualification Exam. Professionals who pass the exam can function as research analysts for FINRA-member broker/dealers. Research analysts are primarily responsible for producing the content in research reports, and their names will appear on the reports.

The exam is actually two-in-one. The Series 86 (100 questions) tests research analysis knowledge, while the Series 87 (50 questions) tests knowledge of industry rules and best practices. A total of four hours is given to complete the Series 86 and 90 minutes is provided for the Series 87; a score of 70% or better is required for passing.

Series 87 – Research Analyst – Regulations

See series 86

Series 99 – Operations Professional

The Series 99 (FINRA) financial exam is given for the following reasons: All individuals who are under the covered functions in FINRA Rule 1230(b)(6) are required to take this exam.

 

 

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