On October 1, 2018, FINRA will begin administering the new Securities Industry Essentials (SIE) exam. The exam will cover only the fundamentals of the securities industry, including the structure of the industry, how the industry functions, and the agencies that regulate the industry. This general knowledge material will no longer be tested in the exams listed above and will now be tested only once in the SIE exam. To be fully licensed, a candidate will complete the SIE exam and one of the specialized exams listed above. Yes, that’s two exams now, instead of one!
Students who want to take the SIE exam will open an “exam window” at the time they register. After opening the window, they will have 120 days to take the exam at a Prometric Center. The exam will consist of 75 questions, and students will be given 105 minutes to complete the exam. A student will receive a pass/fail grade and may receive additional information about areas of their strengths and weaknesses. If a student fails, he or she will have to wait 30 days to take the exam again.
A critical change initiated with the SIE exam is that students do not need to be sponsored to register for this exam. The purpose of the change is to make it easier for individuals to enter the securities industry; however, they will still need to be sponsored for specialized exams, also referred to as “top off” exams. Those taking the SIE exam must be 18 years of age, and the results are valid for four years.
With this rearrangement of material and changing of exams, FINRA will be retiring several exams. The following exams will be retired: Series 11, Series 62, Series 42, and Series 72.
University programs offering investment courses may want to help students prepare for the SIE exam because passing the exam will make students more desirable candidates for positions in the securities industry. We encourage schools to begin incorporating this exam preparation into courses starting in the fall of 2018. We will have student materials in the summer.
You may have heard that FINRA is going to be changing several exams to reduce redundancy and streamline the Securities Industry Essentials Exam (SIE EXAM) 2016 process. They are proposing to offer a core exam covering:
- the structure and function of the securities industry
- the regulatory agencies and their responsibilities
- basic economics
- product knowledge, including stocks, bonds, and mutual funds
- practices that are regulated and prohibited
- professional conduct
This exam will have 100 questions, and individuals need not be sponsored by a company to take it. Candidates will not be required to complete a U-4 or to be fingerprinted for this test. Because of the minimal requirements, companies may encourage their employees to take the exam to increase their level of professionalism. In addition, individuals who are still in school may take the exam, and persons thinking of making a job change or unemployed may take the exam to assist their job search. If these candidates pass the exam, they will have four years in which to find employment with a sponsor before the passing grade expires. If candidates fail the exam, they must wait 30 days to re-test. A second failure requires a 30 day wait, and a third failure requires a 180 day wait.
Once the individual is hired by a sponsor company, he or she will be required to complete a “top off” exam containing specific material for Series 6, 7, or several of the more specialized FINRA exams. Using Series 7 as an example, the specialized exam is likely to consist of 150 questions. With the core exam of 100 questions, the total of 250 questions will be exactly the same number as contained in the Series 7 exam today.
At the November National Society of Compliance Professionals Annual Conference, it was suggested that the core exam would be released in late 2016, and the “top off” exams would be added in early 2017. No outlines have been released for any of the exams, so we will be watching developments very carefully during the year to bring you the latest information.
NASAA has just announced that they will implement changes to the Series 63, 65, 66, exams as of July 1, 2016. Please see our articles on these separate exams so you are prepared!