Series 65 Definition | U.S. News

Anyone who wants to market and sell investments must obtain a securities license. The Series 65 license is required to provide financial advice or services on a non-commission basis.

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The Series 65 exam tests the following four key areas of competence:

  • Economic factors and business information.
  • Investment vehicle characteristics. 
  • Customer investment recommendations and strategies.
  • Laws, regulations and guidelines, including business ethics.

The exam consists of 130 scored questions, and candidates have up to 180 minutes to complete the exam. A passing score requires at least 94 correct answers, which equates to a score of 72%. The exam is a closed-book test administered by the Financial Industry Regulatory Authority, or FINRA.
Candidates do not need to be sponsored by a FINRA member firm to register for the exam. Sponsored candidates fill out and submit Form U4 to FINRA. Non-sponsored candidates submit form U10 and pay the exam fee of $187.

Series 65 license candidates often start the process by passing the Securities Industry Essentials, or SIE, exam. This exam is required for all members of the financial services industry and covers basic topics such as key concepts, definitions and sales ethics.

The Series 65 exam has a reputation for being difficult and may require at least 20 hours of study from a Series 65 textbook, including taking practice exams, to become familiar with the structure and length of the exam.

Testing takes place in-person at a testing center within 120 days of registration unless the candidate provides medical proof he or she must take the test online.

On exam day, test takers are provided with a basic calculator, whiteboard and markers. No other outside materials are allowed. If you fail the Series 65 exam, you need to wait at least 30 days to retake it.

After passing the exam, you have two years to get your license, which includes a background check and fees, before the exam results expire. The license is required in most states. To maintain the license, you must maintain your registration as an investment advisor or work for a sponsoring firm. An individual would be required to retake the test if they have a two-year gap in which they’re not working for a sponsoring firm or registered as an investment advisor. Even then, most state securities regulators have the option to waive the exam requirement if the individual shows that they were working as an investment advisor in a state that doesn’t require registration.

Because the Series 65 exam is considered relatively difficult, an exam prep course may be the best way for candidates to prepare. There are dozens of Series 65 exam prep courses to choose from. ExamFX offers a comprehensive online training program and a variety of study packages. Standardized test prep market leader Kaplan also offers a range of Series 65 exam prep packages and claims its students have an 88% Series 65 exam pass rate.

A Series 65 license allows a financial professional to give clients investment advice and analysis for a fee. A person who has received a Series 65 license qualifies as an independent advisor representative, or IAR, in certain U.S. states.

The Series 65 license alone does not grant individuals the right to sell securities. Typically, a Series 65 license holder must also have a Series 6 or Series 7 FINRA license to market and sell securities.

In addition to the FINRA licenses, a NASAA Series 63 license is required by each state to transact business within that particular state. A NASAA Series 66 license is a combination of the Series 63 and Series 65 licenses and can be obtained by passing a single 150-minute test.

https://money.usnews.com/investing/term/series-65

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