The Series 7 exam, formally known as the General Securities Representative Qualification Examination, measures whether a candidate has the knowledge and skills needed to perform the major duties of an entry-level General Securities Representative. This guide covers the current exam format, sponsorship requirements, content outline, cost, scoring, retake rules, and study resources.
Exam Background and Purpose
The Series 7 exam is administered by the Financial Industry Regulatory Authority (FINRA). It is designed to determine whether an entry-level professional has the knowledge and skills required to perform the duties of a General Securities Representative.
The registration covers a broad range of securities activities involving products such as stocks, bonds, mutual funds, exchange-traded funds, options, municipal securities, variable contracts, direct participation programs, and other investment products.
Important: Passing the Series 7 exam by itself does not complete General Securities Representative registration. Candidates must also satisfy the Securities Industry Essentials (SIE) requirement and all other applicable registration requirements.
Who Is Eligible to Take the Series 7?
The Series 7 is a representative-level FINRA qualification exam. Unlike the SIE exam, it is not generally available to people who simply want to register and take it independently.
To take the Series 7, you must be associated with and sponsored through an eligible FINRA member firm or another organization authorized to sponsor candidates for FINRA qualification examinations.
Series 7: Requires an eligible sponsoring organization and is used toward General Securities Representative registration.
SIE: Does not require firm sponsorship. Individuals may take the SIE before becoming associated with a securities firm.
Series 7 and the SIE Exam
The Securities Industry Essentials exam and Series 7 exam serve different purposes.
The SIE covers foundational securities-industry knowledge, including products, markets, regulatory agencies, prohibited practices, and basic industry structure.
The Series 7 focuses much more heavily on the work performed by a General Securities Representative, including customer accounts, investment recommendations, securities products, trading, and transaction processing.
You need both: Passing the SIE alone does not qualify you as a General Securities Representative. To obtain the registration, you must satisfy both the SIE and Series 7 requirements.
Series 7 Exam Format
The exam contains 125 scored multiple-choice questions. Each question has four answer choices.
You will also receive five unidentified pretest questions that do not count toward your score, bringing the total number of questions you see to 130.
The pretest questions are mixed throughout the examination and are not identified, so you should treat every question as though it will count.
There is no penalty for guessing. You should attempt to answer every question.
What Is on the Series 7 Exam?
The 125 scored questions are divided among four major job functions. One function dominates the exam: providing investment information and recommendations accounts for 91 questions, or 73% of the scored test.
| Job Function | Questions | Weight |
|---|---|---|
| Seeking business from current and prospective customers | 9 | 7% |
| Opening accounts and evaluating customer financial profiles and objectives | 11 | 9% |
| Providing investment information and recommendations, transferring assets, and maintaining records | 91 | 73% |
| Receiving and verifying transaction instructions and processing customer trades | 14 | 11% |
Function 1: Seeking Business
This section covers the activities representatives use to develop business while complying with securities-industry rules.
Topics include communications with the public, advertising and marketing materials, customer contacts, describing investment products and services, public and private securities offerings, investment companies, municipal securities, government securities, and other investments that may be discussed with prospective customers.
Function 2: Opening Customer Accounts
This function focuses on collecting customer information, evaluating a customer’s financial profile and investment objectives, and establishing appropriate accounts.
You should understand customer identification, financial information, investment objectives, account types, account documentation, disclosures, retirement accounts, education accounts, business accounts, trusts, discretionary accounts, supervisory requirements, and suspicious-activity considerations.
Function 3: Investments and Recommendations
This is by far the largest section of the Series 7 exam, accounting for 91 of the 125 scored questions.
You need to understand the characteristics, risks, rewards, tax treatment, and appropriate use of major securities and investment strategies.
Common and preferred stock
Corporate bonds and other debt securities
U.S. government and agency securities
Municipal securities
Options and options strategies
Mutual funds, ETFs, and closed-end funds
Variable annuities and variable life insurance
Direct participation programs and REITs
Portfolio and investment strategies
Customer recommendations, disclosures, records, and asset transfers
Function 4: Customer Transactions
This domain covers receiving, verifying, processing, and completing customer transactions.
Topics include order types, securities quotes, trade execution, short sales, settlement, confirmations, delivery requirements, transaction reporting, margin accounts, margin calculations, customer complaints, trade errors, and other issues connected with completing securities transactions.
How Much Does the Series 7 Cost?
The current FINRA examination fee for the Series 7 is $395.
The SIE fee is separate from the Series 7 fee. If you have already passed the SIE and it remains valid, you do not need to take it again simply because you are preparing for the Series 7.
How Do I Register for the Series 7?
Your sponsoring organization handles the Series 7 enrollment process. You do not normally enroll for the exam as an independent candidate.
1. Become associated with an eligible firm.
You generally must be associated with a FINRA member firm or another organization authorized to sponsor you for the qualification exam.
2. Complete the registration process.
Your firm typically submits the appropriate Form U4 registration filing through the Central Registration Depository.
3. Receive your exam enrollment.
Once the applicable registration request is processed, you receive an examination enrollment window.
4. Schedule your appointment.
Use the instructions provided with your enrollment to select an available examination appointment.
When Is the Series 7 Offered?
The Series 7 is a computer-administered examination offered by appointment rather than during a few fixed testing windows each year.
Once you have an active examination enrollment, you can select from available appointments through the applicable FINRA testing process.
Schedule early: Your enrollment gives you permission to take the exam, but it does not guarantee that your preferred testing date or location will still have an available appointment.
What to Know Before Test Day
Review your appointment information and current identification requirements before the exam.
Expect 130 questions even though only 125 contribute to your score.
Treat every question as scored because the five pretest questions are not identified.
Reference materials are not permitted during the examination.
There is no penalty for guessing, so do not leave questions unanswered solely because you are unsure.
With 130 questions in 225 minutes, you have an average of about 1 minute and 44 seconds per question.
How Is the Series 7 Scored?
The passing score for the Series 7 is 72%.
Your result is based on the 125 scored questions. The five unidentified pretest questions do not contribute to your score.
FINRA uses a statistical process called equating to account for small differences in difficulty among different versions of the examination. This allows candidates taking different sets of questions to be held to the same passing standard.
No penalty for guessing: A wrong answer does not subtract additional points from your score, so attempt every question before time expires.
What If I Don’t Pass the Series 7?
You may retake the Series 7 after completing FINRA’s required waiting period. A new exam enrollment and examination fee are required for another attempt.
You may retake the examination after 15 calendar days have passed.
After three or more successive failures within two years, the waiting period becomes 60 calendar days.
The longer 60-day waiting period applies after three or more successive failed attempts within a two-year period.
How Can I Prepare for the Series 7?
Your study plan should closely follow the current four-function blueprint. Function 3 deserves the largest share of your preparation because it represents 73% of the scored exam.
However, memorizing securities definitions is not enough. You need to understand how products behave, how risks differ, how securities are taxed, which strategies fit different customer situations, and what a registered representative is permitted or required to do.
Series 7 Study Checklist
Use the current four-function FINRA content outline to organize your preparation.
Spend substantial study time on Function 3, which contains 91 scored questions.
Know the characteristics, risks, tax treatment, and suitability considerations of major securities products.
Practice options questions involving positions, strategies, breakeven points, maximum gain, and maximum loss.
Review municipal, corporate, government, and agency securities and understand how their risks and tax treatment differ.
Know account types, customer profiles, documentation requirements, communications rules, disclosures, and supervisory requirements.
Practice order types, settlement, short sales, transaction processing, margin accounts, and margin calculations.
Complete full-length timed practice exams so you are comfortable maintaining your pace for 3 hours and 45 minutes.
Series 7 Study Resources
Use these resources to review the Series 7 content and practice before your examination.
The Series 7 exam is administered by the Financial Industry Regulatory Authority (FINRA). FINRA is not affiliated with StudyGuideZone or Mometrix Test Preparation and does not endorse these products or services.
