Series 63 Exam: Everything You Need To Know

The Series 63 Exam is the Uniform Securities Agent Law Exam. The exam is created by The North American Securities Administrators Association. NASAA is the regulatory body in charge of enacting state securities laws. It is made up of  the State Securities Administrators from each state in the U.S. The exam is administered by FINRA. The exam tests the understanding of the state based laws. Specifically, The Uniform Securities Act. A Series 63 license is required to transact securities business in 46  states.

The short answer to this question is, because it’s required by the states. Agents must register where they work, live and have clients. You can think of the series 63 as your license to conduct business with people. The series 63 license qualifies an individual as an agent of a broker dealer. Most people get the series 63 license when entering the financial services business.  Others may be changing positions within their firm.  And will be acting in a capacity that now requires them to become 63 licensed.

You do not need a series 63 license If you live, work and conduct business exclusively in:

• Colorado
• Florida
• Louisiana
• Maryland
• the District of Columbia
• Puerto Rico 

If you plan on conducting business in any other state you must pass the series 63 exam. 

The North American Securities Administrators’ Association ( NASAA) sets state licensing requirements. NASAA is responsible for the content of the series 63 exam. Obtaining a series 63 license allows you to become a registered representative. This license allows you to function as an agent of a broker dealer. And to earn commissions when executing orders for stock, bonds, ETFs or mutual funds. An agent of a broker dealer may earn transaction based compensation. The series 63 does not allow an agent to share in the fees charged by an investment advisory firm. Nor on managed account products. The series 63 does not qualify an individual as an investment advisory representative.

The Series 63 Exam consists of 60 scored multiple-choice questions. The exam has a time limit of 75 minutes.  Each Series 63 exam will contain experimental questions. As a result, the total number of questions will be 65-70. These questions are not identified during the test. Nor do they count towards the candidate’s final score. Each exam provides more time for test takers to answer these questions.

The passing grade for the Series 63 exam is 72%. The passing score is rounded up from 71.67. Test takers must answer at least 43 of 60 questions correctly.

Each test provides enough time for candidates to answer every question presented. The time limit on the Series 63 exam is 65 minutes. This translates into 1.25  minutes per question. Test takers who have challenges interpreting questions, may find themselves pressed for time. Rushing to answer every question has a negative impact on performance. Ensure you have the ability to complete the test in the time allotted. To do this you must take 60 question  simulated exams.Taking practice exams is a big part of any candidate’s exam preparation. The questions presented are challenging. Students must have a deep understanding of the critical information required to pass.

The questions on the Series 63 exam focus on the following topics: 

• The Uniform Securities Act
• The powers of The State Securities Administrator
• Registration of securities
• Exempt issuers 
• Exempt transactions 
• Registration of broker dealers and agents 
• Registration of investment advisers and agents 
• Ethical practices 

The NASAA official outline breaks down the exam as follows:

• Regulations of Investment Advisers, Including State Registered and Federal Covered Advisers – 3 questions 
• Regulations of Investment Adviser Representative – 3 questions 
• Regulations of Broker-Dealers – 4 questions 
• Regulations of Agents of Broker-Dealers – 8 questions 
• Regulations of Securities and Issuers -5 questions 
• Remedies and Administrative Provisions – 7 questions
• Communication with Customers and Prospects -12 questions
• Ethical Practices and Obligations – 15 questions

The series 63 exam is based on the principles of the Uniform Securities Act. Focusing on its ethical standards and registration practices for agents and firms. Most individuals find that the exam is challenging. Especially the way the exam questions are written. The information tested covers complex topics. A number of these topics are new for most people. Many people know that they must be registered in the states where they conduct business. But know little else relating to the application of the Uniform Securities Act. The application of state securities laws is also heavily tested. You should prepare for the exam by reading a textbook completely with a highlighter. Take notes and work through the more difficult topics. You must read the book, there are no shortcuts and students need to understand this. You must clear your schedule, shut off your phone and focus. In addition to obtaining the knowledge required by the exam, you must master its application. Take as many practice questions as you can. We recommend at least 35 – 40 hours of preparation to ensure you pass your series 63 exam and become a licensed agent.

The answer is, that while it feels like your series 63 license is indeed transferable, in actuality it is not. If you want to change firms, your series 63 registration / license along with all of your other registrations must be terminated by your employer. With a series 63 license you are most likely working at a firm that is registered as a FINRA broker dealer. Since you are registered at a FINRA member firm, Your former employer / the firm that you are leaving will fill out and submit a Form U5 to FINRA. This will terminate your employment and your registration with that firm. When you arrive at your new firm you must fill out and submit a new Form U4. This will begin your registration with your new firm and your series 63 license, along with your other registrations, will become active at your new firm upon receiving notice from FINRA and the states where you conduct business. Technically when you want to change employers, the old firm, the new firm and the agent all most notify the state securities administrator. The filing of the U5 and U4 forms accomplish this task. Your license will only become effective once you have received notification from each state where you plan to conduct business, that you license has become effective.

You must make an investment in your professional development. Your Series 63 license qualifies you as a general securities principal. Many Series 63  licensed principals enjoy lucrative and successful careers. If you have to pay out of pocket, the costs are relatively low. This is true compared to other certifications and college expenses. Some employers pick up or reimburse the costs.  The cost to take the Series 63 Exam include:

• Training materials
• Testing fees
• Registration fees.

Our most comprehensive training package for the Series 63 Exam is $159. This comes with everything you need and includes free shipping. Other providers charge as much as $300 for similar packages.

The testing fee for the Series 63 exam is $80.

Your series 63 license allows you to register as an agent of a broker dealer. The series 63 by itself will not allow you to conduct any business. The following shows the agent exams taken in conjunction with the series 63. The registration obtained after passing the series 63 exam are:

• SIE + Series 6 + Series 63  = Investment Company & Variable Contracts Representative
• SIE + Series 7 + Series 63  = General Securities Representative 
• SIE + Series 22 + Series 63  = Direct Participation Program Limited Representative
• SIE + Series 57 + Series 63 = Securities Trader Representative 
• SIE + Series 79 + Series 63 = Investment Banking Representative

It is very important to choose your Series 63 study material carefully. Quality study material produced by a professional level publisher is key. At a minimum your training materials should contain:

• A comprehensive textbook

• Well produced video training classes

• Challenging test banks

Always start with the textbook. Our Series 63 textbook is the foundation of our learning system. This book has everything you need to be successful.  Our textbooks are comprehensive and easy to follow. We strongly recommend that every student read the books completely. Take notes on key points. This will ensure you know more than the basics, it will ensure you know the facts. 

Our Series 63 video lectures follow our textbooks chapter by chapter. Each lecture provides more details on the content contained in the reading. Different examples show you how the concepts are tested. Best of all, we include feedback from thousands of actual Series 63 test takers. This will help you master the material. Make sure you watch each video lecture to ensure complete understanding. Every video lecture is followed by a quiz. This tests your immediate comprehension of the material.

From there move to the practice tests. Take topic focused custom quizzes. Go back to the videos and chapters in the textbook to firm up areas of weakness.  Now you are ready to take simulated final exams.  Take as many as you can and keep track of your results. Take as many as you can and keep track of your results. The more you take, the more prepared you will be. 

Our Series 63 study material will ensure your success on exam day. Complete with a comprehensive physical textbook, Video lectures and challenging test banks. We are so confident in our Series 63 training course. that we offer you a money back greenlight pass guarantee. Review our Series 63 Exam prep features here