Series 24

Definition

The Series 24 is a securities license entitling the holder to supervise and manage branch activities in broker-dealers firms. To achieve it, applicants must pass the Series 24 exam, officially known as the General Securities Principal Qualification Examination. This qualification is administered by the Financial Industry Regulatory Authority (FINRA).

Phonetic

The phonetic spelling for “Series 24″ would be:”SEER-eez two-for”

Key Takeaways

Series 24, also known as the General Securities Principal Qualification Examination, is an exam offered by the Financial Industry Regulatory Authority (FINRA) in the United States. Here are the three main takeaways:

1. Objective: The main objective of Series 24 is to test the competency of an entry-level general securities principal candidate to perform their job as a general securities principal. It tests areas such as supervision of investment banking, trading, customer accounts, and the primary/secondary market.
2. Prerequisite: A prerequisite for the Series 24 exam is that candidates must have already passed the Series 7 General Securities Representative Qualification Examination or another qualifying examination.
3. Format and Passing Score: The exam consists of 150 scored questions and an additional 10 unscored questions. The majority of the exam focuses on supervision of various types of business operations. A passing score for the Series 24 exam is 70%.

Importance

Series 24, also known as the General Securities Principal Exam, is an important certification within the business and finance sectors because it allows financial professionals to supervise certain activities and operations within a brokerage firm. It is administered by the Financial Industry Regulatory Authority (FINRA) and demonstrates that an individual has the necessary knowledge and skills to manage key aspects of an investment business, such as regulatory compliance, trading and market-making, underwriting, and investment banking. It authenticates that the holder is eligible to supervise branch activities, as well as oversee the work of representatives on the institutional side of the business. Hence, Series 24 is a critical benchmark for anyone aspiring to hold a senior position in a brokerage firm.

Explanation

The Series 24, administered by the Financial Industry Regulatory Authority (FINRA), is essentially a supervisory qualification presented as the General Securities Principal Exam. Its purpose is to endorse the competency of entry-level financial professionals, particularly individuals who perform principal-level duties in a broker-dealer capacity. This certification primarily targets professionals who aim to manage or supervise investment banking or securities business operations. In this role, people are expected to oversee trading and market-making activities, underwriting and advertising, as well as the training of sales personnel and the overall compliance with financial regulations. Generally, having a Series 24 license indicates that a financial professional is proficient, knowledgeable, and ethically competent to perform tasks at a managerial level in a financial institution. This involves satisfying regulatory requirements related to securities transactions, providing sound financial advice, developing effective investment strategies, managing risks, and supervising other financial professionals. Therefore, it is an essential certification for individuals aiming to advance their career in the financial industry, particularly those who aspire to achieve a reputable senior position in a brokerage or investment banking firm. Having a Series 24 license not only symbolizes professional competence but confirms the holder’s ability to contribute responsibly to the organization’s overall operations.

Examples

Series 24, also known as the General Securities Principal Qualification Examination, is a licensing exam required for individuals who want to supervise or manage certain activities at a brokerage firm. Here are three real-world scenarios or examples: 1. Investment Banking: A large investment bank like Goldman Sachs or JP Morgan may require its officers who supervise or manage investment banking or securities business to have a Series 24 license. This allows them to oversee activities such as underwriting, or supervising agents and broker-dealer operations. 2. Mutual Fund Companies: A mutual fund company like Vanguard may require its higher-level employees who oversee the trading of mutual funds to have a Series 24 license so they can adequately supervise these operations and ensure adherence to compliance rules. 3. Broker-Dealer Firms: At a broker-dealer firm like Charles Schwab, executives and supervisors who manage the firm would most likely need this license. Their job would involve overseeing trading activities, managing agents, and ensuring compliance with federal regulations. Having the Series 24 license would demonstrate that they have the necessary knowledge to carry out these tasks responsibly and effectively.

Frequently Asked Questions(FAQ)

Related Finance Terms

• FINRA (Financial Industry Regulatory Authority)
• Securities Licensing
• Compliance Officer
• Registered Principal
• Securities Trading Regulations

Sources for More Information

• Finra
• Investopedia
• Finance Strategists
• WallStreetMojo