The SERIES 7 is 250 question stockbroker license test</a> that licenses you to act as a Registered Representative. Persons who receive this license are accredited to sell most securities. These securities would include: Stock, Bonds, Options, Mutual Funds and Annuities. The license itself is active while you are practicing it. Practicing with a SERIES 7 means that you are either employed or affiliated and sponsored with a member firm. If you leave the business, your license will still remain active for 2 years after your last day with the firm. If you do not re-enter the business within 2 years, your license will expire. You would then have to re-take the exam again. If you had your SERIES 7 at one time in the past and are unsure if it is still active, you can go to the FINRA web site and look yourself up. This method can be used for all securities licensed through the FINRA. This feature is predominately used for customers who wish to look up a broker’s history and see if there are any complaints on them. So, yes your customers can look you up also.
The SERIES 7 exam itself is comprised of many topics although not equally divided. The passing grade is 72%.
Up to 50 questions could be on Municipal Bonds alone. Other major topics include
Options, Industry Rules and Customer Account handling.
The total breakdown of the exam and topic license information is as follows:
EQUITY SECURITIES (Common Stock, Preferred Stock)
OPTIONS (Stock, Index, Foreign Currency)
BONDS (Municipal, US Government Securities and Agencies, Corporate Bonds)
INVESTMENT COMPANIES (Mutual Funds, Closed End Funds, Annuities)
TRADING MARKETS (Stock Exchanges, NASDAQ, Orders)
NEW ISSUES (Securities Acts, Registration Rules, Exempt Securities)
TAXES AND TAX SHELTERS (Limited Partnerships, Capital Gains/Loss, Cost Basis)
CUSTOMER ACCOUNTS (Ticket Processing, Margin And Cash Accounts, Joint Accounts)
ANALYSIS (Balance Sheet, Technical Trends and Charting, Economic Analysis)
INDUSTRY RULES (FINRA And SEC Rules, Rules of Fair Practice)
The exact number of questions in each topic varies, though not greatly. For instance, you will get approximately 30-40 questions on Options but only 5-10 questions on Margin. If you know your Bonds, Rules and Options, you are on your way to passing the exam.
The SERIES 7 is a multiple choice test graded on 250 questions administered on computer by a FINRA testing vendor (Technology Center). 72% is needed to pass the SERIES 7 Exam. You will be given 6 hours to complete the exam in two 3 hour parts. Each question is worth .4 of a point. Each part also includes 5 experimental questions, which do not count on your total score. You will not know which ones
are the experimental questions. Each exam is different, meaning if you take your test next to someone else, your test will not be the same. The percentages will be the same but the questions that each individual is tested on will be random. This applies to all Licensing exams but the difference between tests is less with smaller content exams like the SERIES 63 that is only 60 questions. You should practice with as many Practice Questions as you can.
Series 7 Study Information
Studying and preparing for the exam will vary depending on the time you can dedicate to it. Home study courses given by American Investment Training for Series 7 Training and recommend a plan of 6-8 weeks consisting of 2 hours daily. The course will cover each subject in depth and give you plenty of chapter questions and answers. There will also be several final exams that simulate the actual test content and you might want to use a computer testing program as well. A computer testing program can give you good visual studying because the real exam will be very similar to the computer testing program. The SERIES 7 spreads out the different subjects throughout the test.
You will be given a calculator to use at the center. Applicants are not permitted to bring their own. Scrap paper will be given to you as well for you to use during the test. Once the test officially starts you can write down anything you want (Formulas, Rules etc.). The computer also offers the student the ability to change their answers at the end of the first or second part of the test. Meaning, if you wish to change an answer to a question in the first half, you will have to wait until the end of the first half to do it. Once the second half starts, you will be unable to view your first half. Basically, you are taking 2 different 125 question exams. Even if you are
unsure what the correct answer to a question is, you must enter something before the next question is shown.
License Exam Grade Information
Your grade is given immediately on your screen at the conclusion of the test and a print out will be given to you. Your sponsoring Firm will receive a copy as well. The national first time passing rate for the SERIES 7 is around 60% but if you use a top training company, the rate is more like 80%. Now, we don’t like to think about anything negative but if you do fail the test, you will have to wait 30 days to re-take it. Should you fail the test 3 times, and then there is a mandatory 6 month wait for re-applying. As long as you study consistently and pass your practice exams, you should pass your exam on the first try.
FULL SERIES 7 COURSE
5 BOOK SET, SOFTWARE AND ONLINE OPTIONS
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