Key Takeaways
- Qualifies agents for state securities registration.
- Focuses on state laws from Uniform Securities Act.
- Required with Series 7 or Series 6 licenses.
- Exam has 65 questions; 72% passing score.
What is Series 63?
The Series 63, or Uniform Securities Agent State Law Examination, is a key qualification for securities agents to operate under state securities laws. Administered by FINRA and developed by NASAA, it complements federal licenses like the Series 7 by focusing on state regulations and compliance.
This exam ensures agents understand state-specific rules on registration, exemptions, and enforcement, allowing you to legally advise clients within those jurisdictions.
Key Characteristics
Series 63 certification features several important aspects essential for securities professionals.
- State Law Focus: Covers regulations based on the Uniform Securities Act, emphasizing state registration and compliance requirements.
- Exam Structure: Consists of 65 multiple-choice questions with a 75-minute time limit and a passing score of 72%.
- Complementary License: Typically required alongside federal licenses like the Investment Adviser Representative (IAR) designation or Series 7.
- Mandatory in Most States: Required for agents conducting securities business in over 30 states including California and Arizona, but exempt in some like Florida.
- Continuing Education: NASAA’s Exam Validity Extension Program (EVEP) allows qualified agents to extend exam validity through annual education.
How It Works
To qualify for the Series 63 exam, candidates must be sponsored by a FINRA member firm or submit an application directly, paying the exam fee. The exam tests your knowledge of state securities laws, ethical practices, and administrative provisions, ensuring you meet state regulatory standards.
Passing the Series 63 enables you to register as a securities agent at the state level, often required in conjunction with licenses like the IAR or Series 7. The exam’s content is dynamically generated to maintain consistent difficulty across test sessions.
Examples and Use Cases
The Series 63 license is essential for professionals working with clients in multiple states or handling state-regulated securities.
- Broker-Dealer Representatives: An agent registered with firms such as Delta or American Airlines who offers securities advice must pass the Series 63 to comply with state laws.
- Investment Advisers: Professionals registered under the IAR designation often combine Series 63 with federal licenses to meet both state and SEC requirements.
- New Entrants: Candidates preparing for the Series 7 exam frequently take the Series 63 to expand their licensing scope across states.
Important Considerations
While passing the Series 63 is necessary for state registration, it does not authorize you to sell securities independently; it must be paired with federal licenses like the Series 7. Understanding each state's specific registration rules is crucial to maintain compliance.
Continuing education and staying updated on state law changes ensure your license remains valid and you avoid regulatory penalties. If you are exploring cost-effective ways to build your portfolio, consider resources like the best commission-free brokers to optimize your investment approach.
Final Words
The Series 63 exam is essential for securities agents to comply with state regulations and operate legally across most U.S. states. To move forward, verify your state requirements and begin the enrollment process through your sponsoring firm or directly if eligible.
Frequently Asked Questions
The Series 63, or Uniform Securities Agent State Law Examination, is a test administered by FINRA to qualify candidates as securities agents under state laws. It's important because it ensures agents understand state securities regulations and is typically required alongside federal licenses for state-level registration.
Securities agents who want to register and sell securities in most U.S. states need to pass the Series 63. It is usually required in addition to federal licenses like the Series 7 or Series 6, especially if they have clients in states where the exam is mandatory.
The exam focuses on state securities laws, including regulations of securities and issuers, registration requirements, exemptions, enforcement actions, and ethical practices. Approximately 60% of the questions relate directly to state securities acts as outlined by NASAA.
The exam consists of 65 multiple-choice questions with 60 scored, completed in 75 minutes. Candidates must correctly answer at least 43 questions (72%) to pass, and the test is closed-book with a $147 fee.
If sponsored by a FINRA member firm, the firm files your Form U4 electronically. Non-FINRA applicants submit Form U10 and pay the $147 fee directly. Once approved, candidates have 120 days to schedule the exam.
In most cases, the Series 63 license is valid indefinitely. However, some states participating in NASAA's Exam Validity Extension Program require annual continuing education for broker-dealer agents to extend the license validity up to five years.
No, the Series 63 license alone does not permit independent securities sales. It must be held alongside a federal license like the Series 7 or Series 6 to legally sell securities within states.
Yes, a few states such as Florida and Texas do not require the Series 63 for certain securities agent registrations. However, the exam is mandatory in most other states for agents conducting business there.
