Series 26 Exam

If you plan to become a principal in an investment bank or securities business regulated by the Financial Industry Regulatory Authority, you'll need to take the Series 26 exam.

Qualifications Conferred by the Series 26 Exam

The Series 26 FINRA exam – or the Investment Company Products/Variable Contracts Limited Principal test – is an exam that, if passed, qualifies you to function as the principal for purchase, solicitation, or sale of redeemable securities, of any company that is registered under the Investment Company Act of 1940.  It also qualifies you to purchase or sale securities of closed-ended companies registered under the Act, but only during the time the securities are originally distributed.  Finally, passing the Series 26 exam qualifies you to buy, sell, and solicit variable contracts and insurance premium funding programs issued by any insurance company. 

Registering for the Series 26 Exam

To register to take the Series 26 exam, you must first pass the Series 6 exam and be sponsored by a qualified principal or brokerage.  The exam has an examination fee of $75. 

Series 26 Exam Details

The Series 26 test has a total of 110 multiple choice questions, and you’ll have two hours and thirty minutes to answer as many of them as you can.  The questions cover the five different categories, as described by the FINRA website:

• Hiring and Qualification (11 questions)
• Training of Representatives (19 questions)
• Supervision (24 questions)
• Sales Practices (32 questions)
• Business Processing and Recordkeeping Rules (24 questions)

In order to pass the exam, you'll need to successfully answer 70 percent – or 77 – of the questions correctly.  Skipped questions or incorrectly answered questions do not count against you.  The Series 26 exam is closed book, so you won't be allowed to use any resources.  You will, however, be given scratch paper and a basic calculator by the test administrator. 

Series 26 Question Types

All questions asked on the Series 26 exam have been selected from a pool of questions deemed pertinent to principals’ duties.  Also, the exam is updated yearly to include questions that reflect new regulations and rules and to delete questions on superseded regulations or interpretations.  To get a better idea of the types of questions you'll be asked on the exam, check out the study guide on the FINRA website.