| Series 7 An examination required of potential registered representatives and designed to test the candidates' basic understanding of the securities industry. The multiple-choice test, developed by the New York Stock Exchange, is administered by the National Association of Securities Dealers. Also called General Securities Registered Representative Examination. See also Uniform Securities Agent State Law Examination. Case Study The Series 7 is only the best known of many examinations administered by the National Association of Securities Dealers. Other examinations include:
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Order ProcessingSeries 7. To be licensed to sell securities to individual investors, brokers must pass the Series 7 exam, also called the General Securities Registered Representative Examination.
The six-hour test requires knowledge of specific securities, the concept of suitability, the securities markets, and various aspects of maintaining customer accounts, stocks, bonds, options, mutual funds, direct participation programs, and variable annuities, but not commodities or futures contracts.
Anyone taking the exam must be sponsored by an NASD member firm or an industry self-regulatory organization (SRO).
What Does Series 7 Mean?
A general securities registered representative license administered by the Financial Industry Regulatory Authority (FINRA) that entitles the holder to sell all types of securities products with the exception of commodities and futures. This is basically a broker's license.
Investopedia explains Series 7
The bulk of the Series 7 exam focuses on investment risk, taxation, equity and debt instruments, packaged securities, options, retirement plans, and interactions with clients such as account management. To sit for the Series 7 exam, a candidate must be sponsored by a broker-dealer that is a member of FINRA or a self-regulatory organization (SRO). Successfully completing the Series 7 exam is a prerequisite for most of the FINRA principal examinations.
Related Terms:
• Broker-Dealer
• Financial Industry Regulatory Authority—FINRA
• National Association of Securities Dealers—NASD
• Securities and Exchange Commission—SEC
• Series 63
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