Series 7 Exam

The Series 7 exam – or the General Securities Representative test – is the exam you'll need to take if you wish to qualify to purchase, solicit, or sale securities.  The Series 7 exam evaluates whether or not you are qualified to be a registered representative by testing your knowledge of all areas a representative deals with.  These areas include corporate securities, municipal and municipal fund securities, direct participation programs, options, variable contracts, and investment company products. 

The exam is intended to protect public investors by ensuring that all registered representatives are competent in the following seven tasks, according to the FINRA website:

1. Seeks business for the broker-dealer through customers and potential customers
2. Evaluates customers in terms of financial needs, current holdings, and available investment capital, and helps them identify their investment
3. Provides customers and prospective customers with information on investments and makes suitable recommendations
4. Opens, transfers, and closes customer accounts and maintains appropriate account records
5. Explains the organization, participants, and functions of various securities markets and the principal factors that affect them
6. Obtains and verifies the customer’s purchase and sale instructions, enters orders, and follows up on completion of transactions
7. Monitors the customer's portfolio and makes recommendations consistent with changes in economic and financial conditions as well as the customer’s needs and objectives

There is no prerequisite to taking the Series 7 exam.  However, you will have to pay a $250 examination fee, and in some states you will need to be sponsored by a qualified brokerage or principal.  You may not use any external resources on the exam; however, scratch paper and a basic calculator will be provided.  If you fail the Series 7 exam, you may re-take it after 30 days.  If you fail it three times, you may not re-take the test for six months.

There are 250 multiple choice questions on the Series 7 test, but unlike many of the other tests, the Series 7 is taken in two parts.  Each part is three hours long, and you will have a break between the two.  In addition to the 250 scored questions, ten extra questions will be randomly mixed in the text.  These questions do not count towards your score and are simply there as test questions.  However, they will not be identified in any way, so you will not know which questions are not counted.  Each of the 250 real questions counts for one point if answered correctly, while incorrectly answered or skipped questions do not count against you.  You’ll need to answer 175 questions correctly to pass the Series 7 exam.

All questions on the Series 7 exam pertain only to the current rules and regulations.  Questions are aimed at the entry level candidate, as the purpose of the test is to determine if you're qualified to serve as a registered representative – not to see where you rank against other candidates. 

NOTE:
If you're already registered with the Financial Services Authority in the UK or with one of Canada’s securities regulatory organizations, you may be able to take a shortened version of the Series 7 exam.  These include the Series 17 or the Canadian module of the Series 7 (either Series 37 or Series 38).  Contact FINRA for more details.