Your decision to becoming a Stock broker will require your dedication and hard work. The financial stability in this occupation is awesome, you will be getting a handsome pay and a possibility of one of the highest annual earner. But this does not come free. This needs constant education and knowledge growth not to mention the examination needed in acquiring a stockbroker license. One of the most basic tests is the Uniform Securities Agent State Law Examination or commonly known in the United States as The Series 63 exam. It was developed by the North American Securities Administrators Association (NASAA), and is one of the basic tests to get a stockbroker license.
Series 63 Exam Details to Pass
This exam is administered by the Financial Industry Regulatory Authority (FINRA) and demonstrates your knowledge of the related rules and regulations of the state securities and will entitle the qualified individual to become a registered representative to solicit orders for investment securities such as preferred stock, bonds, warrants for a private sector plus corporate debt and equity from the business sector. It is a must to pass this exam since according to the research made by The Journal, a broker that has failed the examination under the Series 63 test tends to have alleged multiple mis-conduct due to unauthorized trading, churning and excessive trading just to generate commissions.
Just to get a sale the broker seem to forget the law governing the securities, and what can be sold or not. Under this license exam, the candidate needs to register with a fee of $115 and needs to pass by getting a 72% score out of the total 65 questions including the five pre-test. The test structure is a multiple choice one for one hour and fifteen minutes duration. These seem to be shorter than the other FINRA exams but the Series 63 examination is known to be a tricky one since it will measure your knowledge on which transactions and situations are permitted and are required by law. Let us check the details needed and tips in order to ascertain your eligibility to get the exam and increase the probability of passing and getting your license. We recommend you read about the FINRA series 7 exam article as well.
Get a Degree
You do not need any formal education before to be considered as a stockbroker and your knowledge in the business field is enough to become a stockbroker. But as the industry evolves in a fast paced manner, so as the skills and ability required to be one. Although there is no particular degree required to be taken for this occupation, it is a plus is you are in the commerce course, say, accounting, business, finance, or economics.
This way, your college degree is related to the main topic and products discussed during client consultation and your decisions will be based o your knowledge regarding the investment securities. Remember there are lots of securities and these would be further explained same as the rules applying the different types through your education. In fact, it is one of the requirements in getting a license.
A firm sponsor is needed as one of the prerequisites in taking the Series 63 exam. The sponsor firm has then well requested a slot for you to take the exam. It is one of FINRA’s requirements in the two basic exams which are Series 7 and Series 63. A U-Form should be filled out completely and submitted to FINRA to check candidate’s eligibility. This normally is allowed by the firm when you are doing your stockbroker training within the 4-6 month of staying in the organization. Once a sponsor is ascertained you can now request for candidacy and get the test.
Since we have already identified the requirements to get the exam eligibility, now let us take a look at some of the common issues that the examinee often encounter. Even the most educated candidates often find themselves under pressure during the exam. In this case you can brace yourself and find other ways to avoid this scenario. Sponsors usually get stock broker trainee salary which could range between $20,000 – $25,000 depending on the firm.
Time Not Enough
The candidate is given a 65 item multiple choice question that should be finished within the 75 minutes time given by the examiner. The questions are tricky and you may need to read it twice to get the thought correctly. Take note though that you only have an average of 1 minute and 15 seconds to answer each question. Imagine if you stayed too long on one item, the end result is not enough time to answer the question. The trick is to focus and select the first hunch. If you are not sure about the answer, proceed so that you still have time to answer these easy questions. If you still have time then go back to the skipped question and reread it.
Unfamiliar Words and Term
The most common reason for you not to be able to finish the test is due to unfamiliar terms used in the test. Especially that we are dealing with business terms. The trick is to familiarize yourself with the different terms before the exam. Try to visit some website and get online tutor or tests and the possibility of passing will increase as well. The most common choice though are online refresher courses, which normally gives you materials such as a downloadable PDF and supplementary textbooks and exam preparatory software’s.
It seems that the questions in the Series 63 exam are contained the same information and just basically given a little twist. These online courses will give you a first hand experience of what the test may feel like. There are software provided that will give a demonstration. In short you will be given the same number of questions in an hour and fifteen minutes duration, to gauge how fast you would be able to finish the exam. That way you can further improve your speed on reading the questions and answering them.
Answer all Questions
The trick to the two most common issues are simple and easy and you can avoid this scenario. First, get ready by checking any possible questions that may come up in the exam. You can get these through test guides for Series 63 exam or do it online through free test guide. Make sure to pay attention on those definitions since most likely the test items are patterned that way. Lastly, check on the test structure and the test pattern, once you have familiarized yourself with the test structure, then it will be easy for you to understand it correctly. Taking these things under consideration, do not forget to read each question carefully. Now that you have the bits and pieces on the Series 63 examination let us further check the important information associated with taking it. These are the common questions of the aspiring candidates.
What happens if an eligible candidate does not have a sponsor?
In filling out the U-form provided by FINRA, you will be asked about the firm you are associated with and you need to fill out the details needed. In case that the candidate does not have a sponsor, you can just fill out the form U-10. Look for the part that says no firm and choose not applicable. This time though, the cost of taking the exam will come from your own pocket.
What happens if you the Series 63 Exam?
After taking the exam and failed it, you may take the test again but there is a waiting time before you are allowed to do so. If it is the first time you have failed, waiting time is thirty (30) days after the date of prior examination. If it is your second or third attempt and still failed it, then you can retake it after one hundred eighty (180) days after your last attempt. After the waiting period you then can re register and the process depends if you have a sponsor or none. In case of sponsorship, your firm will receive a notification and will need to request another registration for you.
If there is no sponsor, just fill out the Form U-10 and re-register. In any case though the same amount should be paid for registration. We are done with tackle all the information related to The Series 63 exam along with the preparation needed, registration and the test process itself, you are now more confident in deciding to get the test. Indeed getting this exam will not only give you a license on soliciting orders for investment securities, but also to avoid any instances of financial related field in the Wall Street trading industry which may give you series of issues such as criminal charges or being terminated from your firm.