Series 4 Exam

The Series 4 FINRA examination is on Registered Options Principals (ROP) and will test your knowledge of the various rules related to options trading, options personnel, exchange rules, and the regulations that involve options accounts and contracts.  The Series 4 exam is required for anyone seeking a position as a registered options principal, compliance registered options principal, or senior registered options principal. 

Passing the Series 4 ROP test meets the requirements of the American Stock Exchange, FINRA, the Pacific Exchange, the Chicago Board Options Exchange, and the Philadelphia Stock Exchange for a Registered Options Principal.

Registering for the Series 4 Exam

A Series 7 license is required as a prerequisite.  You must be sponsored to take the exam by a qualified FINRA principal, and must pay a fee of $80 in order to register for the exam.  More details on the process of registering for the exam – including any necessary paperwork – can be found on the FINRA website at www.finra.org.

Series 4 Exam Questions

The Series 4 exam contains 125 multiple choice questions, and you'll have three hours in which to complete the exam.  The testing center will provide you with scratch paper and a basic calculator, but other than these tools, you may not use any resources or reference materials on the test.  Candidates found using any other materials will be harshly penalized by FINRA. 

The Series 4 examination will test your knowledge of three different areas: options investment strategies (34 questions), trading practices and supervision of sales activities (75 questions), and record keeping and reporting (16 questions).  Each correct answer is worth one point, but you're not penalized for incorrect answers or skipped questions.  To pass the test, you must answer 70% of all of the questions correctly – which equals 88 of the 125 questions on the test.

Updates and Revisions to the Series 4 Exam

The actual questions on the Registered Options Principals test are updated often, so expect questions on new rules and interpretations to appear on the exam.  Likewise, questions on old rules or interpretations will be deleted from the exam, so there’s no need to study old material.  All questions should be assumed to apply to exchange listed standardized options, to exclude commissions, and to exclude transactions cost considerations – unless the question specifically says otherwise.

It's important to consult the study guide provided by FINRA in order to adequately prepare for the exam.  The guide provides information on the specific rules and details you'll want to review before registering for the test, as well as sample questions that will give you an idea of what to expect on exam day.  Of course, these samples aren't necessarily indicative of what you'll find on the exam – they're intended to make you familiar with the structure and format of the actual test.