The series 7 exam is an examination organized by the Financial Industry Regulatory Authority (FINRA). This exam is designed to determine if an individual is qualified enough to be a registered representative.
Candidates who pass this exam have the authority to talk or work directly with individuals and institutional investors.
For many candidates, the series 7 exam difficulty level is high. This is because you would be required to answer 135 complex questions in less than 4 hours.
Additionally, you will have to score above 72% in order to pass, as the series 7 exam doesn’t offer a large margin for error. However, if you prepare adequately, you may find out that this exam is not that difficult.
This article talks extensively about the series 7 exam and how to prepare for this exam in order to encounter no difficulty.
What is the series 7 exam?
The series 7 exam is a qualification exam that is designed to determine if an individual possesses adequate knowledge. It is a way of assuring that these individuals truly understand the market.
This exam is for people who want to be general securities representatives, brokers, or dealers. Additionally, for people who want to buy or sell pretty much any kind of financial securities, options, or contracts.
The exam usually contains 135 questions which are classified into 4 functions.
The first function focuses on a representative’s public interaction ability and regulation of advertising materials. In the series 7 exams, 7% of the questions are usually under this function.
The second function focuses on a representative’s ability to obtain and evaluate a customer’s financial objective. Additionally, determining the best investment to meet those objectives. In the series 7 exams, 9% of the questions are usually under this function.
The third function is by far the most important function in the series 7 exams. It focuses on the representative’s knowledge of securities laws and industry regulations.
These are laws and regulations pertaining to investment strategies, product options, record keeping, and customer profiles. In the series 7 exams, 73% of the questions are usually under this function.
The fourth function focuses on a representative’s knowledge of executing and verifying purchases or orders. As well as all the requirements for transaction settlement, reports, customer complaints, etc. In the series 7 exams, 11% of the questions are usually under this function.
Series 7 exam difficulty level
The series 7 exams can be quite tough, especially if one does not prepare adequately for them. According to the Financial Industry Regulatory Authority (FINRA), the pass rate for this exam is 63%.
It may seem pretty high, but considering that you have just 3 hours and 45 minutes to answer 135 questions, it is kind of difficult. Let’s see how you can best prepare for this exam in the section below.
How to study for the Series 7 exam
Getting up to 72% in the series 7 exam is essential for you to advance in the financial service industry. It takes hard work and commitment to do this, but if you follow this guide, you will be well prepared.
1. Develop a solid study plan and stick to it
The first step you should take is to create a study plan for the FINRA series 7 exam and stick to it. You need to study enough, I recommend planning on a total of 80 – 100 hours for those with financial background.
If you do not have a strong financial background or no experience in general, I recommend at least 150 hours of study. Try calculating how long you have till the exams and try to fix your daily studies to get the required hours.
2. Read more on the laws, regulations, and strategies
As mentioned earlier, the majority of the questions would be about testing your knowledge of laws, regulations, and strategies. This is to know how well you would perform in this field.
For this reason, it is important you understand all these concepts properly. Spend time reading the best possible solution or recommendation for various scenarios.
3. Use practice question
There is no better way to build your confidence before the exam than to take practice test questions. Utilize sites like Kaplan Financial or STC USA, they offer the series 7 prep course and practice questions to test yourself regularly.
When answering these practice questions, you should be able to spot functions where you are weak. Study more on these functions and take the test again, with time, you’ll get the hang of it.
4. Focus more on understanding the concept
The series 7 exam is not like normal exams, it focuses more on real-life applications. For this reason, gaining knowledge and applying them in real-life scenarios should be one of your main objectives when studying.
How much time do you have on the series 7 exam?
Generally, when taking the series 7 exam, you will have 3 hours and 45 minutes.
What is the passing score in the series 7 exam?
The passing score is said to be 72%.
Is the series 7 exams more difficult than the SIE?
Yes, it is. The series 7 exam is generally harder than the SIE.
How much does the series 7 exam cost?
The series 7 exam usually costs around $300.
What happens if you fail the series 7 exam?
If you fail the series 7 exam, it is mandatory that you be on a 30-day waiting period before paying to take the exam again.
After 3 consecutive fails, the waiting period would be increased to 6 months before you will be allowed to retake the exam.
Conclusion: Series 7 exam difficulty level
The series 7 exam was designed to determine if an individual has acquired adequate knowledge in the field. It consists of 135 questions which are to be answered under 3 hours and 45 minutes.
The difficulty level of the series 7 exam is one that many people are well aware of. However, as difficult as this exam can be, if you prepare adequately, it should be a walkover for you.
It may be a bit tedious, but surely if you can put in the work, you will definitely excel in the exam.
I hope you enjoyed reading this article, to help you prepare better for the exam, I recommend you read this article on the best time to study.
Thanks for reading.