In order to become a Registered Representative with a broker-dealer in the United States, you must first pass the Series 7 Examination. This test is very challenging and requires extensive studying and preparation. This article will first review the basics of the test and then provide tips and strategies for your Series 7 exam prep, so that you can pass the exam on your first attempt.
The Series 7 Exam is also known as the General Securities Representative Exam. It is operated and administered by the Financial Industry Regulatory Authority, better known as FINRA. FINRA has several certification tests that allow an agent to communicate with investors at the retail level, and the Series 7 is the broadest and most comprehensive of these tests. After passing the Series 7 the representative is permitted to engage in the solicitation, sale, and purchase of every securities product that is currently on the market. This includes municipal securities, corporate securities, options, investment company offerings, and direct participation programs.
The Series 7 Exam consists of 260 multiple choice questions. It is broken into two equal sections, and the candidates have 3 hours to complete each part. Ten of the questions are trial questions for future tests and these do not count. Of course there is no way to know which questions are for trial purposes, so you shouldn’t even worry about them. Of the 250 graded questions, the candidate must answer 72% correctly to pass the exam. All questions are multiple-choice with four possible answers. The cost to take the test is $265, and in order to register you must be sponsored by a company that is either a FINRA members or a Self-Regulatory Organization.
In preparing for the test you should first focus on getting quality books and study guides. Many sponsoring firms will provide workbooks or other materials to their Series 7 candidates, but it is still a good idea to look for additional study materials online or at the bookstore. Make sure you visit our overview of the best Series 7 Study Guides available. FINRA also provides a content outline and a list of regulations that are covered in the test, as well as a list of reference materials. These regulatory lists and materials should be ignored completely. The amount of information covered by these statutes is so broad that it would take years to understand it all. And the list of books would take weeks to read. Instead, stick with workbooks and study guides that are focused directly on the Series 7 test.
After reviewing your study materials for a few weeks you will be ready to begin working on practice questions. Our website even has free Series 7 practice questions that you can work through. As you go through these questions be sure to carefully review each question that you miss. If you find that you are missing more than half the questions you will want to go back into study mode for another week. As you continue to work through these questions you will begin to gain confidence and you will soon realize that you are ready for the actual exam.
On exam day, make sure you show up rested and relaxed. Don’t worry about cramming for five more minutes before the test, because that will just cause more stress. You will have plenty of time for all the questions, so just proceed slowly and carefully. Do not let tricky or impossible questions derail you or cause frustration. Just make your best guess and move on. By following these simple Series 7 exam prep guidelines you will be able to pass the exam on your first attempt, and it will mark the beginning of a great career.
Related Exams and Resources:
Series 7 Study Guide – An overview of the best study guides available.
Series 7 Practice Exam