Frequently Asked Questions (FAQs) About the Series 7 Exam (2024)

FAQs

What kind of questions are on the Series 7 exam? ›

The Series 7 exam consists of 135 multiple-choice questions, of which 125 questions are scorable. The 10 additional questions are “pretest” questions that are randomly distributed throughout the exam and do not count for or against your score.

Series 7 Exam Requirements

It tests common topics, such as regulatory agencies and how they function, acceptable and unacceptable industry practices, product knowledge, and fundamentals of securities trading. The SIE exam does not require potential candidates to be sponsored by a FINRA member firm.

Is the Series 7 Exam Difficult? Clocking in at 125 questions to be answered in three hours and 45 minutes, the Series 7 exam is considered the most difficult of all the securities licensing exams.

When preparing to take the Series 7 exam, you should plan to study for 125-150 hours. Typically, candidates study over the course of 4-6 weeks. The time you need to spend preparing for the exam varies depending on your familiarity with the material.

The Series 7 is no different than any somewhat challenging freshmen level college exam. The content is fairly straight forward but there will be the odd curve ball thrown.

Series 7 is for entry-level, registered representatives. That means if you want to be any kind of general securities representative, broker or dealer and want to buy or sell pretty much any kind of financial securities, options or contracts, you'll need to pass the Series 7.

If I fail the Series 7 exam, what is the wait time before I can retake it? Candidates who do not pass the top-off exam must wait 30 days before taking it again. However, if you fail it three times in succession, you must wait 180 days.

The new Series 7 is harder, kind of

The exam no longer includes all the simpler questions that now make up the SIE, yet the passing score is still the same: 72%.

Disqualification of a Series 7 License

You are convicted of certain misdemeanors and any felony within a period of ten years from the date of conviction. A court of competent jurisdiction issued against you a temporary or permanent injunction involving a broad range of unlawful investment activities.

How many people fail the Series 7 the first time? ›

Around 6.5 out of 10 people, or 65%, will pass the Series 7 exam on the first try. The first-time pass rate for the Series 7 has been between 60% and 70% for the past few years. This is an important distinction, as it shows how difficult the exam is and how prepared you need to be in order to pass it.

It is a corequisite of the SIE exam, which tests you on general securities topics. By contrast, the questions on the Series 7 exam are detailed and related to the day-to-day activities, responsibilities, and job functions of stockbrokers. Therefore, it can be considered a challenging exam.

Having taken and passed both, I can say that without a doubt the CPA exam is more difficult, and for one primary reason… breadth of subject matter. The Series 7 is 3 hours and 45 minutes, is comprised of 125 questions, and has a pass rate of approximately 70%.

The Series 7 top-off exam typically includes 10-15 options questions. That's about 10% of the 125 questions that comprise the exam.

In a Nutshell

However, after passing the Series 7 Exam, you're able to sell mutual funds, annuities, individual equities, bonds, options, as well as other securities. Typically, the Series 7 is the better choice if you're interested in selling individual securities either now or in the future.

Any state bar exam as well as the UBE (Uniform Bar Exam) is much more difficult than the Series 7 exam taken to become a stock broker. It takes 3 years of intense study to get through law school after which most take a 2 or 3 month bar review course prior to sitting for the bar exam.

Eligibility. Candidates must be associated with and sponsored by a FINRA member firm or other applicable self-regulatory organization (SRO) member firm to be eligible to take FINRA representative-level qualification exams.

Can I take a break during the exam? Taking breaks should be done sparingly, as there is no break scheduled into this exam. This means if you do decide to take a break, the exam clock will not stop, the amount of time you have to complete the exam will be reduced.

There are multiple ways to a passing score on the examination. The exam is approximately 30% math (e.g. options, margin and convertible bonds). Some candidates feel strong in the math and will plan to score well there, allowing for a slightly weaker performance on the regulations.

Can you get fired for not passing Series 7? ›

You usually have at least 2 times to try to pass. If you do not pass, you cannot move forward and yes you are terminated.

Some test takers fail the Series 7 exam because they spend too much time on reading and memorizing calculations and concepts. In this article that lists 7 strategies for passing the Series 7 exam, it says to balance studying between manuals and practice questions, which is sound advice for first-time exam takers.

For students who have recently completed the Series 7, this is a moderately difficult exam. The Series 65 is more challenging for students who have not completed the Series 7. It's recommended that students learn through a variety of methods, such as reading, as well as continuous practice exams.

Overall, the ‌Apple Watch Series 8‌ is a very minor upgrade over the Series 7, with the body temperature sensor and Crash Detection being the only significant changes, meaning that it is difficult to recommend upgrading.

The new Series 7 top-off exam is considerably harder than the previous Series 7. The questions removed to reduce the exam length were mostly basic, definitional questions, which are now tested on the SIE Exam.

A complication of the Series 7 and 66 licenses is that you can only maintain them in good standing for two years once you've left an investment firm.

To obtain their licenses, financial advisors must pass the Series 7 exam, which is no easy feat. Once they've cleared this hurdle, however, new professional doors may open in financial advising, investment management and other roles.

What to Bring and What Not to Bring. At all testing centers, you will be required to show one form of valid government-issued ID containing a photo and signature. Your photo and signature will also be taken there on the spot.

The Bottom Line

Municipal bond questions sometimes make up to 20% of the 135 question items found on the Series 7 exam.

A candidate can take the Series 7 exam as many times as they like; however, for the first three times, the candidate has to wait 30 days before trying again; after the first three attempts, the candidate has to wait six months.

How to make the most money with a Series 7? ›

Working for a mutual fund company as a fund manager is one excellent way to put your Series 7 license to good use. Mutual fund managers buy and sell stocks on behalf of subscribers, according to the stated objectives and strategies of each fund they oversee.

The Series 7 exam is often considered the most difficult securities licensing exam. But, the answer is up to you.

Experienced CPAs can earn in the mid- to high six figures, especially if they end up in a management or leadership position.

Often considered the most difficult exam, Financial Accounting and Reporting (FAR) has had the lowest passing scores of the four exams. The amount of material CPA Exam candidates have to learn for the exam, coupled with the combination of memorization and application, makes this exam more difficult.

Thousands is the Answer

We highly recommend, and see the most success, with Kaplan study material for the Series 7. They offer a little over 3,000 questions in there QBank. We should also mention that getting through all of them is not only very helpful but an excellent way to see a variety.

As a result, the Series 66 exam is considered by most to be an easier test. Like the Series 65 exam, it qualifies the individual to act as an IAR and fulfills the requirements for state registration.

The only major types of securities or investments that Series 7 licensees are not authorized to sell are commodities futures, real estate, and life insurance.

You can be employed as a financial analyst, for example, without a CFA charter. The Series 7 is a license, comparable to those you have to earn to sell real estate or insurance. Anyone who is a stockbroker must hold the Series 7 license.

You will learn basic formulas and be required to complete calculations, but luckily there is no advanced math on the exam. You will learn relevant laws and regulations and need to understand how they apply to the job functions, but you will not need a law degree to pass!

What is the Series 7 exam equivalent to? ›

Series 7: Similarities. Both are finance industry credentials, and both are earned by passing a set of exams. The CFA exam has three levels. The Series 7 exam is a corequisite of another exam called the Securities Industry Essentials (SIE), and you must pass both exams to earn your license.

For students who have recently completed the Series 7, the Series 66 exam is easier than it is for students who have not. This is viewed as a tough exam because it is so broad.

Around 6.5 out of 10 people, or 65%, will pass the Series 7 exam on the first try. The first-time pass rate for the Series 7 has been between 60% and 70% for the past few years. This is an important distinction, as it shows how difficult the exam is and how prepared you need to be in order to pass it.

First, read the Series 7 textbook book completely and fully. Take notes and highlight the key points. Once you have completed the textbook, take as many Series 7 practice questions as you can. The Series 7 exam prep software is designed to help you master the application of the knowledge.

A candidate can take the Series 7 exam as many times as they like; however, for the first three times, the candidate has to wait 30 days before trying again; after the first three attempts, the candidate has to wait six months.

There are over 40,000 people every year who take the Financial Industry Regulatory Authority's Series 7 examination, with only two-thirds passing.

As a result, the Series 66 exam is considered by most to be an easier test. Like the Series 65 exam, it qualifies the individual to act as an IAR and fulfills the requirements for state registration. There are exam fees for these exams that must be paid before taking them.

There is no prerequisite for the Series 66 exam. However, the Series 7 exam is a co-requisite to the Series 66 exam.

However, after passing the Series 7 Exam, you're able to sell mutual funds, annuities, individual equities, bonds, options, as well as other securities. Typically, the Series 7 is the better choice if you're interested in selling individual securities either now or in the future.