What Is The Series 63 Exam

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How To Pass The Series 63 Examand Become A Uniform Securities Agent

What is the SERIES 63 Exam, and how do you PASS it?

What is the best way to prepare for the Series 63 exam ? We get asked this question all the time. The answers is that, while everyone learns in a different way, there are certain steps that everyone must take to pass the Series 63 exam. Reading the Series 63 textbook is absolutely essential to passing the exam. You must read the book completely and fully. Read the book, take notes and highlight the key points. Once you have completed the textbook, take as many Series 63 practice questions as you can. The Series 63 exam prep software is designed to help you master the application of the knowledge. The article that follows will provide you with additional insight on how to pass the Series 63 exam.

Series 63 Vs Other Licensing Exams

The Series 63 is just one licensing exam that financial professionals can take.

The Series 6 allows a financial professional to sell mutual funds, variable annuities and insurance, while the Series 7 allows one to sell most types of securities, except commodities and futures. And the Series 65 licenses a candidate as an Investment Advisor Representative .

Dont forget about the Series 66, too. It licenses a candidate as an investment advisor or securities agent, allowing them to legally give investment advice.

Keep in mind that the passing grade differs for each of the financial securities licensing exams. For example, while the passing grade for the Series 63 and Series 65 is 72%, the Series 66 requires 73%.

What Is Series 7

The Series 7 exam is a general securities representative exam administered by FINRA.

The general securities representative exam is well detailed, with an in-depth knowledge evaluation of candidates taking the exam.

The in-depth content of the exam seeks to assess the extent to which prospective general securities representatives can perform critical functions when licensed to do so.

These critical functions have bearing in the area of purchase and sale of corporate securities, solicitations, direct participation programs , investment company products, variable annuities, municipal securities, options, and government securities.

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Preparing For The Series 63 Exam

While you are allowed to retake the exam, why would you want to risk it? Youve worked hard to get to this point, and this exam is an essential step in your career. Mometrix doesnt want you to worry about the exam and what it means to not pass on the first attempt. Their experts have done the research on the topics, concepts, and regulations that are covered in the test and have developed a stress-free approach to studying for the Series 63 exam. In fact, Mometrix is so confident on your return on investment that they offer a one-year, 100% money-back guarantee. With 20 years of research and experience, Mometrix is qualified to assist you with your study plan. Let Mometrix guide you to a successful first attempt.

Check out Mometrix’s Series 63 Flashcards

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Series 63 Exam Overview

Series 63 Exam Flashcard Study System : Series 63 Test Practice ...

A brief overview of what the Series 63 is all about is a great starting point to get us into the flow of things.

Its critical to note if you want to sell securities as a broker-dealer in just about any state in the United States, you will need this license.

To begin, this is a North American Securities Administrators Association exam thats administered by Financial Industry Regulatory Authority .

It is also known as the Uniform Securities Agent State Law Examination.

Test-takers for this exam would already have passed other FINRA Series exams, as well as the Securities Industry Essentials qualification exam.

A form U4 is not a prerequisite either.

What about sponsorship from a FINRA member firm?

Thats not needed at all.

Why is the Series 63 a critical exam thats essential for broker-dealers that have secured either their Series 6 or 7 licenses already?

Well, this is a state law exam thats a requirement in 44 states in America.

The Series 63 exam is not required by broker-dealers in the following states.

So what does the FINRA 63 test?

Well, it looks at a candidates knowledge and understanding of the state laws that deal with various fiduciary obligations, ethical practices, and other regulations.

Now lets talk a little about who would need a Series 6 license.

Well, anyone that wants to sell securities within the securities industry in a nutshell, for example, someone selling annuities.

Lets take a brief look at what the FINRA Series 63 covers.

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Question: I Don’t Have Much Time To Study What Should I Focus On

For students crunched on time, we always recommend a few key topics:

  • Security vs Not a Security
  • Exempt vs Non-Exempt Securities
  • Difference between State Registered Advisors and Federally Covered Advisors
  • Antifraud Provisions
  • The above topics are quite core, and if you only have a few days then make sure you spend some time on these. It’s best to read through these portions of the text first and then jump right into practice questions to ensure you have them down pat. If you can cover most questions from these areas, you have a good chance on the exam. Good luck!

    Rules For Investment Advisors Vs Broker

    For those of you that are well into your studying, the difference between broker-dealers and investment advisors may seem straight forward. Nevertheless, this is not an obvious distinction early on.

    When it boils down to it, you will have to know the difference between the rules that govern broker-dealers and their agents . You will also need to know the difference between what rules apply to investment advisors and their investment advisor representatives .

    There are small differences between state requirements and federal requirements that you should also know.

    For instance, registration requirements of a state registered investment advisor are different than for a federally covered investment advisor as outlined above. When doing business interstate, there are different rules that apply, as oppose to doing business intrastate. Similarly, what’s required of investments advisor reps, is different than what is required for agents .

    Make sure to study these carefully because many students blend the rules for each together.

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    Securities Institute Series 63 Pros And Cons

    • Physical and Digital: In addition to a large library of online study materials that include video lectures and practice exams, Securities Institute of Americas Complete Self Study Solution includes physical study materials as well. Best of all is that all physical copies of your textbooks and flashcards will be shipped to your location free of charge.
    • Tons of Practice: The test bank included with this FINRA review course has over 800 questions that you can use when creating realistic practice exams. Since the actual Series 63 exam only has 60 questions on it, this means you have enough material to practice the full exam over ten times without repeating a single question!
    • Excellent Bundles: For most professionals in the securities industry, there are several additional FINRA licenses required for their desired careers. Fortunately, Securities Institute of America offers discounted bundles that combine study materials for multiple related licenses such as Series 7 and Series 63.
    • Access Period: Securities Institute of America advertises unlimited access to all their FINRA course materials but the truth is that you only have six months before your access expires. Its unclear what they mean by the phrase unlimited access, since theres a very clear limit to how long youre allowed to study.

    What Other Licenses Do Insurance Sales Professionals Need

    FINRA Series 63 Exam Free Practice Questions Part 1

    The licensing requirements for each state to become an insurance sales professional are different. But, in general, you need more than a Series 6 and Series 63 license to sell insurance in your state. The other licenses required to sell insurance in most states include:

    Property and casualty licenses are not generally associated with insurance products that require a FINRA license, but they are a great addition to any insurance agents repertoire.

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    Series 63 Exam Content

    Sixty percent of the exam covers State Securities Acts and related rules and regulations:

    • Regulation of Investment Advisers , both state-registered advisors and those registered with the Securities and Exchange Commission

    Investment advisers are firms that offer advice about securities in exchange for a fee.

    • Definitions of professional titles, duties, and roles
    • Registration process
    • Regulation of Investment Adviser Representatives

    Investment Adviser Representatives are the individuals associated with an investment adviser firm.

    • Definitions of professional titles, duties, and roles
    • Registration process
    • Regulation of broker-dealers and of the agents of broker-dealer

    The SEC defines a broker as any person in the business of making securities transactions for accounts belonging to other people, and dealers as anyone in the business of buying and selling securities for their own account.

    • Definitions of professional titles, duties, and roles
    • Registration process
    • Termination protocol
    • Regulation of securities and issuers

    Issuers are defined as governments, corporations, or investment trusts that register and sell securities to finance their own business operations.

    • Definitions of professional titles, duties, and roles
    • Registration process

    Why Would You Take The Series 63 Exam

    In simple terms, the series 63 exam makes an investment professional a fiduciary. What is a fiduciary? It is someone who has been placed in a position of trust and therefore has the legal obligation to act in their clients best interest, even if it conflicts with their own. Fiduciaries can be found across a wide range of industries and professional relationships, including realtors, lawyers, trustees, and more.

    Despite popular belief, not all financial advisors are fiduciaries. This could cause potential conflicts of interest when it comes to a managed investment portfolio. In the cases where financial advisors are incentivized to sell investment products for a commission, there is obvious friction.

    For this reason, it is recommended that people seeking out investment advice only engage with those that are fiduciaries. This ensures the relationship will be built on honesty, good faith, and loyalty. It also gives an added layer of protection for those that are entrusting someone else to manage their finances. High caliber investment firms recognize this and will require their advisors to become fiduciaries.

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    Iars And Investment Providers

    Investment advisor representatives are individuals employed by an investment advisor who makes recommendations or otherwise gives financial or investment advice to clients. The IAR’s relationship with the investment advisory firm is similar to that of an agent who works for a broker-dealer.

    NASAA’s Memorandum of Understanding from 1997 on this subject deals with both the federal-covered investment advisor and the investment advisor representatives who work for the firm.

    “If an investment advisor is registered with the SEC, the states may not require registration, licensing, or qualification of the investment advisor or its supervised persons, except that states may license, register, or otherwise qualify investment advisor representatives who have a place of business located within that state.”

    This MoU refers to the National Securities Markets Improvement Act of 1966 and lays out the requirements for testing persons who are to be IARs. In order to avoid costly penalties, investment advisory firms must ensure their IARs are registered correctly.

    After the IAR meets the registration requirements they must pass the appropriate exams before providing any client financial advice. State requirements vary on this point, however, in most cases, the IAR must pass both the Series 63 and Series 65 or the Series 66 exam and the Series 7.

    What To Know About The Series 63 License Exam

    Series 63 Exam

    Although the exam is not easy, putting in the time to practice will help you sit down with confidence when the time comes. About 86% of people that take the series 63 license exam are able to pass on the first try.

    If you do not pass the exam on your first try, you will need to wait at least 30 days before taking it again. If you do not pass three times in a row, you will have to wait 180 days before you are able to re-enroll.

    Its important you dedicate at least 30 hours of studying to prepare for the exam. Take as many practice exams as you can. This way you can get a feel for the types of questions you will be asked. Whatever you do, dont rush or try to cram your study hours the week before your exam. Doing so will only create stress and impede your ability to perform your best.

    All in all, if you live in the majority of states where the series 63 license exam is a requirement, passing the exam brings you one step closer to beginning your career as an investment professional.

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    Series 63 Vs Series 65 Vs Series 6: An Overview

    When a person is preparing to enter the world of investment professionals, they must take certain qualification examinations. And, they must pass them. There are multiple examinations that must be successfully negotiated before the individual is prepared to fully function in their profession.

    Once the prospective registered representative passes the first core examination, which is usually the Series 6 or Series 7 exams offered by Financial Industry Regulatory Authority , there’s at least one more hurdle that remains: the Series 63, 65, or 66 exams. A question in the minds of many is, “Which one do I need to pass?” In this article, we’ll show you how you can answer this question for yourself.

    What Is On The Series 63 License

    The series 63 exam consists of 65 multiple-choice questions, with only 60 being counted towards your final score. The remaining 5 questions are experimental questions the North American Securities Administrators Association might consider using on future exams. You could expect to take your exam on a computer at a Prometric testing location.

    You will need to answer 43 questions correctly out of the total 60 scored in order to pass the exam. But you will only have 75 minutes to complete the exam. This means that you cannot afford to spend more than a minute and 15 seconds on each question, or else risk falling behind. Although the Series 63 is known for being one of the shorter securities licensing exams, it is also notorious for harboring trick questions.

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    What Kinds Of Jobs Can I Get With Series 6 And 63 Licenses

    When you pass your SIE, Series 6, and Series 63 exams, along with the proper state insurance licenses, you are eligible for a job at almost any level in the insurance industry. You can become a sales representative, a broker, or opt for insurance marketing. If you will be managing other agents with Series 6 and 63 licenses, then you will also need to obtain your Series 26 license.

    Series 63’s Hardest Questions: Offer To Sell Vs Gifts

    Series 63 Exam | Definition By Animation [3 min] | Learn Finance

    We also get a lot of questions from students around offers to sell. Namely, what is a gift vs. what is an offer to sell?

    What we tell students here is that if it sounds like the receiver of the security is getting something for free then it’s a gift. In other words, if I gave you a non-assessable stock then that is a gift.

    However, if I give you warrants BUT only under the condition that you buy a bond from me first, then that is a sale with respect to the warrants.

    Note that the free warrants are conditioned upon buying the bonds. In simple terms – these warrants aren’t really a gift if you have to buy something else to get them.

    Assessable stock is also a confusing concept for most people, so let’s talk about that for a second.

    Assessable stock is stock where the investor may be called to “pony up” more money if asked to. Imagine that you receive a cell phone as a gift. It’s a nice thing to get, but if you want to use it then you will have to pay your monthly bill. Similar to the assessable stock, it is a gift that requires payments made over time. Since there are payments that will be required over time, the authorities don’t consider this type of stock a gift.

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    How Hard Is The Series 63 Exam And What Kind Of A Job Can I Get With It

    You can expect the exam to be tough, because of the limited time you have to complete the questions. You have only 75 minutes. Therefore, if you spend more than a minute and 15 seconds on each question, you will quickly fall behind. However, you have a high probability of passing if you know the topic and havent crammed. With the Series 6 and 63 licenses, you can operate as a financial adviser or insurance agent. As a result, you can offer mutual funds and works for a brokerage, investment business, bank, or insurance company. With the Series 7 license, you can work as a stockbroker for a brokerage, investment firm, or bank.

    How Long Is A Series 63 Exam Valid If I Am No Longer Registered

    The Series 63 exam, also known as the Uniform Securities State Law Examination, is the state test for broker-dealer representatives. The exam is by the North American Securities Administrators Association exam and administered by the Financial Industry Regulatory Authority .

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    Question: Do Most People Finish The Exam On Time

    Yes. The feedback that we get from our students is that the time allotted for the Series 63 exam is plenty. In fact, as of this writing we have never had a student tell us that they ran out of time on the exam. Even though you only have 75 minute , most questions take about a minute or so. Some are quicker than that. That is plenty of time to make it through the 60 questions on the exam. Ideally, if you have time left over at the end of the exam, we highly recommend that you go back over the whole exam and make sure that you check all of your questions. Most students check questions about which they were unsure, but not the ones where they thought they got the answer right . Check everything if you have enough time!

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