What Is the Series 7 Exam and How Do You Get Licensed?
Navigate the Series 7 exam. Learn what this key financial qualification covers and the process to obtain your securities license.
The Series 7 exam, officially known as the General Securities Representative Qualification Examination, is a key qualification for professionals in the U.S. securities industry. Administered by the Financial Industry Regulatory Authority (FINRA), passing this exam allows individuals to sell a broad spectrum of securities products. It demonstrates the proficiency needed to operate effectively within the financial services sector.
Purpose of the Series 7 License
The Series 7 license qualifies an individual to solicit, purchase, and sell a wide range of securities products. This includes corporate securities, municipal securities, options, and investment company products like mutual funds and unit investment trusts. License holders can also deal with variable annuities, direct participation programs, and exchange-traded funds (ETFs). This broad scope makes the Series 7 a comprehensive credential for professionals who interact directly with clients regarding investment recommendations and transactions. It does not cover the sale of commodities or futures.
Eligibility and Sponsorship
To take the Series 7 exam, candidates must first obtain sponsorship from a FINRA member firm or another applicable self-regulatory organization (SRO) member firm. This means an individual must be employed by a firm that will supervise their activities. The sponsoring firm initiates the registration process by filing a Uniform Application for Securities Industry Registration or Transfer (Form U4) with FINRA.
Candidates must also pass the Securities Industry Essentials (SIE) Exam before taking the Series 7. The SIE exam is an introductory assessment covering fundamental securities industry knowledge, including product types, risks, market structure, and regulatory agencies. While the SIE does not require firm sponsorship and is open to anyone at least 18 years old, it is a corequisite for the Series 7. Both exams must be passed to obtain the General Securities Representative registration.
Exam Content and Format
The Series 7 exam assesses a candidate’s competency across four major job functions of a general securities representative. These functions include:
Seeking business for the broker-dealer
Opening accounts after evaluating customer profiles
Providing investment information and recommendations
Processing transactions
The exam tests knowledge on various financial instruments, regulatory requirements, and ethical interactions with clients. Specific topics cover:
Equities
Debt securities
Municipal bonds
Options
Mutual funds
ETFs
Life insurance
Annuities
Retirement plans
Taxation
The examination consists of 125 scored multiple-choice questions, plus 5 to 10 unscored experimental questions. Candidates have 3 hours and 45 minutes to complete the exam. A passing score of 72% is required.
The Examination Process
Once eligibility requirements are met and a candidate is sponsored, the sponsoring firm enrolls them through FINRA’s Central Registration Depository (CRD) system. After enrollment, FINRA provides a 120-day window for the candidate to schedule and take the exam.
Exams are administered at Pearson VUE test centers. On exam day, candidates should arrive at least 30 minutes early for check-in. Two forms of identification are required, one of which must be government-issued with a recent photo. Personal belongings, including cell phones and study materials, are not permitted in the testing room and must be stored in a locker. Test-takers receive a dry-erase board, marker, and a basic calculator for the computer-based exam. Results are typically provided immediately after the session.