Definition
The Series 66 is a securities licensing exam administered by the Financial Industry Regulatory Authority (FINRA). It combines the securities and regulations knowledge tested in both the Series 63 and Series 65 exams. Successful completion qualifies an individual to function as both a securities agent and an investment advisor representative.
Phonetic
The phonetics for the keyword “Series 66” would be: “Siri-eez six-six”
Key Takeaways
- The Series 66 exam is an offshoot of the Series 63 and Series 65 exams, combining elements of both. It is designed for investment advisors and securities agents to qualify them in the investment industry.
- The primary areas of knowledge tested in the Series 66 are securities, investment vehicles, securities regulations, economics, and strategies for clients. Being proficient in these areas is crucial for passing the exam.
- Proper preparation is vital to pass the Series 66 exam. This includes understanding the exam layout and rigorous consistent study, ideally using comprehensive study materials and practice exams.
Importance
The Series 66 is a securities license required by most U.S. states for individuals to act as investment advisors. It combines aspects of the Series 63 and Series 65 license exams, covering both state securities regulations and principles of investing and risk management. This certification is particularly important as it demonstrates proficiency and credibility in the field of financial advisory and is a key requirement for roles such as financial analysts, financial advisors and portfolio managers. For businesses, it is essential to ensure that their advisory staff possess a Series 66 license to legally provide investment advice, which ultimately promotes trustworthiness and professionalism among clients.
Explanation
The purpose of the Series 66 exam, also known as the Uniform Combined State Law Examination, is to qualify individuals as investment advisor representatives or securities agents. It is used and recognized in the United States by the North American Securities Administrators Association (NASAA) and is administered by the Financial Industry Regulatory Authority (FINRA). This exam covers topics necessary to provide investment advice and effect securities transactions for clients. It is essential for those who are aiming to progress further within the finance and investment field by getting accredited to both sell securities and provide advice.
The Series 66 exam is used specifically for individuals to become fully equipped with the knowledge to properly execute the job as both an investment advisor and a representative. This involves a strong understanding of securities, investment strategies, laws and guidelines revolving around these processes, business ethics, and fiduciary obligations to the client. Passing the exam helps individuals further their positions since it is a credential that is often required for many job roles within finance and investment. Essentially, this certification assures that individuals are competent in these areas, and validates them in the eyes of regulatory bodies, employers, and clients.
Examples
1. Investment Advisory Firm: An individual working at an investment advisory firm who aims to advance in their career could choose to take the Series 66 exam. This is a step towards becoming a fully licensed securities professional who can advise on securities investments and execute trades.
2. Broker-Dealer: Someone starting at a broker-dealer might start off with a Series 7 license for selling a broad range of securities products. If they want to evolve and add to their responsibilities by adding advice on securities investments, they will likely take Series 66 exam. This exam prepares them for providing more comprehensive financial investment services to clients.
3. Financial Planner: For a financial planner or consultant keen on adding investment advisory services to their existing services, taking the Series 66 exam can be a strategic move. Having this license allows them to provide more comprehensive financial planning services to their clients involving securities investment.
Frequently Asked Questions(FAQ)
What is the Series 66?
The Series 66, also known as the Uniform Combined State Law Examination, is an exam administered by the Financial Industry Regulatory Authority (FINRA) in the United States. It qualifies a candidate to be both a securities agent and an investment advisor representative.
Who should take the Series 66 exam?
The Series 66 exam is recommended for individuals aiming to provide clients with comprehensive investment advice, conduct securities transactions, and grow their career in the financial services industry.
What are the prerequisites for taking the Series 66 exam?
Before taking the Series 66 examination, you must have already passed the Series 7 exam.
How many questions are there in the Series 66 exam?
The Series 66 exam consists of 110 multiple-choice questions, out of which only 100 are scored. The additional 10 are pre-test questions.
How long is the Series 66 exam?
The Series 66 exam takes approximately 150 minutes, or 2.5 hours.
What topics are covered in the Series 66 exam?
The Series 66 exam covers topics within four main sections: Regulatory Compliance and Procedures, General Principles of Investing and Retirements, Client and Customer Investment Recommendations, and Laws and Regulations.
What score do I need to pass the Series 66?
You will need at least a score of 73 out of 100 to pass the Series 66 exam.
Where can I take the Series 66 examination?
The Series 66 exam can be taken at any approved FINRA Test Centre. Candidates need to make an appointment for the exam on the FINRA website.
How do I prepare for the Series 66 exam?
Candidates are advised to spend a substantial amount of time studying the guide provided by FINRA and consider enrolling in preparation courses or using preparation materials specifically designed for the Series 66 exam.
Can I retake the Series 66 examination if I fail?
Yes, if you fail the Series 66 examination, you can retake it. However, you must wait for 30 days before reattempting. If a candidate fails the exam three times in succession, they must wait 180 days before taking it again.
Related Finance Terms
- Uniform Combined State Law Examination
- NASAA (North American Securities Administrators Association)
- FINRA (Financial Industry Regulatory Authority)
- Investment Advisers
- Securities Licensing
