Key Takeaways
- Authorizes sales of mutual funds and variable products.
- Requires passing Series 6 and Securities Industry Essentials exams.
- Cannot trade stocks, bonds, or options.
- License lapses without FINRA-registered firm employment.
What is Series 6?
The Series 6 license, officially known as the Investment Company and Variable Contracts Products Representative Qualification Exam, authorizes individuals to sell packaged securities like mutual funds, variable annuities, and unit investment trusts. Administered by FINRA, it is designed for entry-level financial professionals focusing on specific investment products rather than individual stocks or bonds.
Unlike broader licenses, Series 6 holders are limited to certain securities, making it ideal for roles that emphasize mutual funds and similar products within firms like investment companies.
Key Characteristics
The Series 6 license has distinct features that define its scope and requirements:
- Scope of Products: Permits selling mutual funds, variable annuities, variable life insurance, unit investment trusts, and municipal fund securities such as 529 plans.
- Entry-Level Focus: Targets professionals starting in financial services, requiring passing the Securities Industry Essentials (SIE) exam first.
- State Registration: Most candidates must pass the Series 63 exam for state law compliance alongside Series 6.
- Limited Trading Rights: Does not authorize trading of individual stocks, ETFs, or bonds, differentiating it from broader licenses.
- Continuing Education: License maintenance requires ongoing FINRA education and employment with a registered firm.
How It Works
To obtain the Series 6 license, you must first pass the SIE exam and secure sponsorship from a FINRA-member firm that files the necessary registration forms. The Series 6 exam itself comprises 100 multiple-choice questions assessing knowledge of packaged securities and client suitability.
Once licensed, you can solicit and process sales of permitted products, focusing on client needs such as retirement income or education savings. Compliance with state securities laws is ensured by passing the Series 63 exam in most jurisdictions, aligning with "Blue Sky" regulations.
Examples and Use Cases
Professionals holding the Series 6 license often work in roles that combine insurance and investment products, offering clients tailored portfolios:
- Retirement Planning: Selling variable annuities to clients aiming for steady income streams during retirement.
- College Savings: Advising families on 529 plans and municipal fund securities for education funding.
- Mutual Fund Sales: Working with Delta employees or retirees who prefer diversified mutual fund options within their portfolios.
- Financial Advisors: Integrating mutual funds and insurance products while guiding clients toward low-cost options like those found in low-cost index funds.
Important Considerations
While the Series 6 license opens doors to packaged securities sales, it restricts you from handling individual stocks or ETFs, which may limit your product offerings compared to a Series 7 license. Staying current with FINRA continuing education requirements is essential to maintain your registration and client trust.
If you aim to expand your product range beyond packaged investments, consider additional licensing. Meanwhile, understanding concepts like A shares can enhance your ability to explain mutual fund fee structures effectively to clients.
Final Words
The Series 6 license is essential for professionals focusing on packaged securities like mutual funds and variable annuities. To move forward, ensure you meet the exam prerequisites and secure firm sponsorship to begin the licensing process.
Frequently Asked Questions
The Series 6 license qualifies individuals to sell packaged securities products such as mutual funds, variable annuities, variable life insurance, unit investment trusts, and municipal fund securities like 529 plans. It is designed for entry-level financial representatives and is administered by FINRA.
To obtain the Series 6 license, candidates must first pass the Securities Industry Essentials (SIE) exam and then the Series 6 exam itself. Additionally, passing the Series 63 exam is required in most states to comply with state securities laws.
Holders of the Series 6 license can sell mutual funds, variable annuities, variable life insurance, unit investment trusts, and municipal fund securities like 529 savings plans. However, they cannot trade individual stocks, ETFs, bonds, or options.
Yes, candidates must be sponsored by a FINRA member firm or self-regulatory organization, which files the necessary registration forms and handles background checks and exam fees before you can take the Series 6 exam.
The Series 6 exam consists of 100 multiple-choice questions, lasts 135 minutes, and requires a 70% score to pass. It tests knowledge of packaged securities products, client suitability, regulations, and transaction procedures.
The Series 6 license is valid only while you are employed with a FINRA-registered firm. If your employment ends or your registration expires, the license lapses and you must re-register with another firm to maintain your license.
License holders must complete FINRA's Continuing Education requirements, which include the Regulatory Element (annual online training) and the Firm Element (firm-specific training), to keep their Series 6 license active and in good standing.
The Series 6 license is ideal for insurance professionals or entry-level financial advisors who want to offer packaged investment products like mutual funds and variable annuities, often complementing insurance sales or retirement planning services.
