What is the Series 7 Exam?
The Series 7 exam, also identified as the General Securities Representative Exam (GSRE), is an exam for registered representatives. The Financial Industry Regulatory Authority (FINRA) runs the exam. In the United States, stockbrokers take this exam to get a license to trade.
The test determines the degree to which each applicant has the knowledge needed to accomplish the critical roles of a general securities representative, including sales of corporate securities, municipal securities, investment company securities, variable annuities, direct participation programs, options and government securities.
This exam is managed by the Financial Industry Regulatory Authority (FINRA). In order to sit for the test, an applicant must be backed by an affiliate firm of either FINRA or a self-regulatory organization (SRO).
Many students find that using test preparations books help to improve their scores.
See our list of the best Series 7 Exam prep books here.
Series 7 Exam Format
| Seeks Business for the Broker-Dealer through Customers and Potential Customers | |
| Evaluates Customers' Other Security Holdings, Financial Situation and Needs, Financial Status, Tax Status, and Investment Objectives | |
| Opens Accounts, Transfers Assets, and Maintains Appropriate Account Records | |
| Provides Customers with Information on Investments and Makes Suitable Recommendations | |
| Obtains and Verifies Customer's Purchase and Sales Instructions, Enters Orders, and Follows Up |
Series 7 Exam Scoring Structure
Test takers are permitted 6 hours to finish 250 multiple choice questions. The passing score is 72%, and people who fail this exam must wait thirty days before taking it another time.
Each applicant’s test includes 10 extra, unidentified pretest problems that do not contribute toward the applicant’s score. The 10 problems are randomly dispersed throughout the test. Therefore, each applicant’s test comprises of a total of 260 items (250 scored and 10 unscored). There is no disadvantage for guessing. Therefore, applicants should try to answer all problems.
Following a deep-rooted method known as standard setting, FINRA directs the passing score for the exam based on a quantity of reasons including industry trends, historical exam performance and valuations of the subject matter difficulty by of a panel of industry professionals with the designated registration. For the Series 7 test, the passing score is 72%. This passing score reproduces the fitness needed to hold the designated registration.
On the day of the exam, contenders will receive an interpretation of their exam marks both on screen and in paper layout at the end of their exam session. The score report will designate pass/fail status and a score profile signifying performance based on each major subject area covered on the test. It is suggested that aspirants who fail the examination review the material provided on the score report, as they may want to put emphasis on the areas that they performed poorly on when preparing to retake the examination. For security reasons, the test and specific items are not accessible for review after taking the test.
Series 7 Exam Availability
The examination overseer will make available a whiteboard/dry erase marker and rudimentary calculators to the candidates, which must be given back to the assessment center director at the end of the examination session. Some test problems involve calculations. Only the given calculators may be used during the examination.
The examination may contain problems that necessitate the use of exhibitions (e.g., charts, graphs, tables). If so, the problems will define when to refer to a display.
Candidates are not permitted to bring any reference materials to testing centers. Severe punishments are imposed on aspirants who cheat or attempt to fraud the FINRA managed examinations.
Firms must catalogue any individual involved in the securities business of the company by filing the proper registration application online through the Central Registration Depository (Web CRD) to become listed with FINRA, the proper authorities and/or self-regulatory establishments. After registration, a 120-day window will be accessible for the applicant to schedule an appointment to take the prerequisite qualification test(s).
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