We often get asked to differentiate the Series 66 vs Series 7 Exams. The reason being, that one typically follows the other.
Anyone that has taken both of them will tell you that neither is a walk in the park. In today’s post, we take a deeper dive into what we believe are key differentiators, and where we see the most failure.
Earning FINRA licenses is a rite of passage for financial advisors. The Series 7 and Series 66 exams are among the most common. But what exactly do they entail and how do they differ?
This article will compare the Series 7 and Series 66 exams side-by-side. We’ll cover:
- What each license qualifies you to do
- Exam content and format
- Steps to register and schedule the exams
- Passing scores and difficulty levels
- Key differences and which you need
Follow along for a detailed breakdown of the Series 7 and Series 66. Let’s dive in!
Series 7 Exam Overview
The FINRA Series 7 exam qualifies candidates to register as general securities representatives It focuses on assessing competence to solicit, purchase, and sell all types of securities products
What the Series 7 Enables You to Do
With a Series 7 license, representatives can conduct business including:
- Opening customer accounts
- Providing investment information
- Making recommendations
- Facilitating trades
- Following up on behalf of a broker-dealer
In essence, it allows you to fully function as a broker empowered to buy and sell securities for customers.
Exam Format and Content
The Series 7 exam consists of 260 multiple choice questions administered over two 3-hour sessions. Topics covered include:
- Securities markets and regulations
- Investment products like stocks, bonds, options, mutual funds
- Understanding customer profiles and investment objectives
- Sales practices and prohibited activities
The breadth of content reflects the scope of the license. The Series 7 qualifies brokers across a wide spectrum of securities.
How to Schedule the Series 7 Exam
Before registering for the Series 7, you must be sponsored by a FINRA member firm. The firm submits a Form U4 filing and pays the exam fee on your behalf.
You can then work with the firm to schedule the exam at any of the 300+ Prometric test centers nationwide. It is administered 6 days a week year-round.
Passing Score and Difficulty
The passing score on the Series 7 exam is 72% correct. The overall difficulty level is moderately high compared to other FINRA exams. Historical pass rates average around 65%.
Meticulous study is required, as the broad content tests both conceptual knowledge and regulatory details. Now let’s look at the key details on the Series 66.
Series 66 Exam Overview
The Series 66 exam qualifies candidates as investment adviser representatives. It focuses more on fiduciary duties, ethics, and portfolio management strategies.
What the Series 66 Enables You to Do
With a Series 66 license, representatives can:
- Provide financial planning and investment advisory services
- Make specific recommendations and manage client portfolios
- Work as an adviser without directly selling securities
It enables advising and managing clients’ investments in a fiduciary capacity.
Exam Format and Content
The test is administered in 2.5 hours with 100 multiple choice questions. Content covers:
- Investment vehicles, returns, and risks
- Portfolio management strategies
- Recommending suitable investments for clients
- Laws and ethics for investment advisers
The Series 66 focuses more on holistic financial planning topics compared to the trading-oriented Series 7.
How to Schedule the Series 66 Exam
Like the Series 7, you must be sponsored by a FINRA firm who submits the Form U4 and exam fee on your behalf before registering.
You can then work with them to schedule the Series 66 exam at any Prometric test center. It is administered year-round other than Holidays.
Passing Score and Difficulty
The passing score on the Series 66 exam is 75% correct. It is considered moderately difficult, with pass rates around 65% historically.
Now that we’ve covered the key details on both exams, let’s compare some of the major differences.
Key Differences Between the Series 7 and Series 66
Although the Series 7 and Series 66 both lead to securities licensure, they differ significantly in their focus and qualification.
Here are some of the major distinctions:
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Type of License – Series 7 is for general securities brokers. Series 66 is for investment adviser reps.
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Exam Content – Series 7 focuses on trading and transactions. Series 66 focuses on planning and portfolio management.
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Passing Score – 72% on Series 7, 75% on Series 66.
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Test Length – 6 hours for Series 7, 2.5 hours for Series 66.
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Question Volume – 260 questions on Series 7, 100 questions on Series 66.
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Qualifies for Selling – Series 7 allows securities sales. Series 66 does not.
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Fiduciary Duty – Series 66 has greater focus on ethics and fiduciary responsibility.
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Prerequisites – Series 66 requires passing Series 7 first.
As you can see, the licenses confer very different qualifications, despite both leading to careers as financial advisors.
Do You Need the Series 7, Series 66, or Both?
Since the Series 7 and 66 qualify different functions, many advisors obtain both licenses. However, the right choice depends on your specific career focus:
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Securities brokers – Series 7 alone allows broad securities sales.
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RIA investment advisers – Series 66 plus Series 65 or 63 meets state requirements.
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Dually registered advisors – Series 7 plus Series 66 enables maximum flexibility.
For comprehensive practice, having both the Series 7 and Series 66 opens the most doors. But many successful advisors need only one or the other.
Analyze your intended focus, then decide if the Series 7, 66, or both makes the most sense.
Steps to Efficiently Pass the Series 7 and Series 66
Preparing for the Series 7 and 66 exams takes diligence. Here are some tips:
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Study early – Allow 2-3 months for comprehensive preparation.
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Learn actively – Take detailed notes, use flashcards, discuss concepts.
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Practice questions – Taking mocks tests under timed conditions is crucial.
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Master weak areas – Identify deficiencies through practice exams, then drill down.
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Avoid distractions – Finding focus amidst work duties is challenging but vital.
With commitment and focus, you can master the knowledge required for both the Series 7 and Series 66 exams.
The Takeaway
Passing the FINRA Series 7 and Series 66 exams are major steps forward in a financial advisory career. While the licenses have some overlap, they confer very different qualifications.
The Series 7 enables registered representatives to facilitate securities transactions. The Series 66 qualifies investment adviser representatives to provide portfolio advice.
Understanding the distinctions allows you to chart the appropriate path for your goals. With diligent preparation, you can pass these challenging exams and unlock your career potential.
What are Some Other Differences?
When it comes to both exams, there is plenty to work on. The Series 7 has loads more Options content, while the Series 66 has loads more rules and regulations (and exceptions to those rules).
Each however, carries its own unique challenges.
The Series 7 Exam tends to have a lot of memorization, based especially on mechanical problem-solving. For example, if you know the steps to solving the maximum gain or loss for “Options Spreads” problems, then you’re most of the way home on those types of questions (here are some Series 7 Video Courses to help you).
On the other hand, the Series 66 Exam has a lot more scenario-dependent types of questions. For instance, a registered representative may not be allowed to solicit the sale of an unregistered non-exempt security, but they are allowed to sell the same type of security if the sale is unsolicited.
In short, each exam has plenty of content from which to confuse the exam taker.
That said, different people tend to have different experiences with each exam.
Yes, But Is There a Difference in Passing Rates?
All in all, what you really might like to know is what we see around passing rates. As you probably already know, neither FINRA nor NASAA publishes passing rates. The reality is that any general statistic is somewhat helpful on average. However, these are unlikely applicable to any single individual. Consider two students. One completed their MBA from a top 10 school, and the other just graduated from community college.
From our experience there is no doubt that both can pass the exam. However, the MBA graduate in a grueling investment banking position may fail their SIE Exam due to lack of study time. The community college graduate may pass their first time because they were given four weeks on the job to study. Knowing that 60%+ (not the true statistic) of those that take it the first time pass is not super helpful. Each student has their own experience.
So unfortunately, youll have to judge your own likelihood for yourself.
Anecdotally speaking however, it may be helpful to share what we see. When it comes to the Series 7 vs Series 66, despite the different individual experiences we mentioned above, the passing rates seem about the same for both exams in our experience.
Both are definitely harder than FINRAs SIE Exam. But, from what we hear and see, the passing rate is quite similar.
As a result, the silver lining is that if you can pass the Series 7 Exam, then the Series 66 Exam is totally doable.
If you have any more questions, feel free to reach out! Good luck!
Which test should I take? Series 65 or Series 66?
FAQ
How much can I make with a Series 7 and 66?
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Annual Salary
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Hourly Wage
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Top Earners
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$200,500
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$96
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75th Percentile
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$161,500
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$78
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Average
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$127,750
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$61
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25th Percentile
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$80,000
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$38
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Is the series 66 exam harder than FINRA’s SIE exam?
Both are definitely harder than FINRA ‘s SIE Exam. But, from what we hear and see, the passing rate is quite similar between the Series 66 and the Series 7. As a result, the silver lining is that if you can pass the Series 7 Exam, then the Series 66 Exam is totally doable.
Do I need to take the series 66 and Series 7 exams?
Those who wish to be IARs must pass the Series 66 and Series 7 exams. The newest of the three is the Series 66 exam, which is equivalent to taking both the Series 63 and Series 65 exams. There are no prerequisites for the Series 63 or Series 65 exams while the Series 7 exam is a corequisite for the Series 66 exam.
What is the difference between Series 7 and Series 66?
When it comes to both exams, there is plenty to work on. The Series 7 has loads more Options content, while the Series 66 has loads more rules and regulations (and exceptions to those rules). Each however, carries its own unique challenges. The Series 7 Exam tends to have a lot of memorization, based especially on mechanical problem-solving.
Is the series 66 exam easier than the series 65 exam?
As a result, the Series 66 exam is considered by most to be an easier test. Like the Series 65 exam, it qualifies the individual to act as an IAR and fulfills the requirements for state registration. There are exam fees for these exams that must be paid before taking them.
