How to Pass the NASAA Series 66 Exam

What can you do with a Series 66 license? What does the exam cover and how should you prepare for it? Keep reading for answers to your Series 66 questions. Continue reading

What does the Series 66 exam allow me to do?

The Series 66, also known as the Uniform Combined State Law Exam, is created by the North American Securities Administrators Association (NASAA), which represents state securities regulators in the United States, Canada, and Mexico. Passing the Series 66 exam is like passing both the Series 63 (Uniform Securities Agent State Law Examination) and the Series 65 (Uniform Investment Adviser Law Examination). However, to register as an investment adviser representative with the Series 66, you must also pass the FINRA Series 7 General Securities Representative exam. In conjunction with the Series 7 license, the Series 66 license qualifies you as both an investment advisor representative and a securities agent.

As an investment adviser representative, an individual can perform the following tasks:  

    • Make recommendations and render general advice regarding securities
    • Manage accounts or portfolios of clients
    • Solicit, offer, or negotiate for the sale of investment advisory services
    • Supervise employees who perform any of the above tasks.

Note that the Series 7 exam is a co-requisite to the Series 66, so you can take the exams in either order. However, Solomon recommends passing the Series 7 before the Series 66 since much of the information tested on the Series 7 is likely to appear on the Series 66 exam.

About the Exam

The Series 66 exam consists of 100 scored and 10 unscored multiple-choice questions covering the four sections of the NASAA Series 66 exam outline. The 10 additional unscored questions are ones that the exam committee is trying out. These are unidentified and are distributed randomly throughout the exam. The NASAA updates its exam questions regularly to reflect the most current rules and regulations.

About the Series 66 exam

Note: Scores are rounded down to the next lowest whole number (e.g. 72.9% would be a final score of 72% – not a passing score for the Series 66 exam).

Topics Covered on the Exam

The NASAA divides the Series 66 exam into four sections:

Topics on the Series 66 exam

The Series 66 exam covers many topics including the following:

    • Business Cycles and Economic Factors
    • Fundamental Analysis
    • Types of Risk
    • Equity and Debt Securities
    • Investment Companies
    • Discounted Cash Flow
    • Derivatives
    • Alternatives and Insurance Products
    • Clients and Client Profiles
    • Capital Market Theory, Portfolio Management, and Taxation
    • Taxation of Debt and Equity Securities
    • Retirement Plans, ERISA, Special Accounts
    • Trading and Performance Measures
    • Regulations of Securities Professionals
    • Regulations of Securities and Issuers
    • Remedies and Administrative Provisions
    • Recordkeeping Requirements
    • Net Worth/Net Capital Requirements
    • Business Practices for IAs and IARs
    • Performance-based fees
    • Wrap fees
    • Custody
    • Communication with Clients and Prospects
    • Compensation and Client Funds
    • Conflicts of Interest

Question Types on the Exam

The Series 66 exam consists of multiple-choice questions, each with four options. You will see these question structures:

Closed Stem Format:

This item type asks a question and gives four possible answers from which to choose.

Which of the following is not a current asset?

    1. Inventory
    2. Accounts receivable
    3. Cash
    4. Trademarks
Incomplete Sentence Format:

This kind of question has an incomplete sentence followed by four options that present possible conclusions.

Callable preferred stock is more likely to be called when:

    1. Interest rates go up.
    2. Interest rates go down.
    3. The price of the common stock rises.
    4. The price of the common stock falls.
“EXCEPT” Format:

This type requires you to recognize the one choice that is an exception among the four answer choices presented.

An investor calculating the investing merits of a payment or payments not yet received might potentially use all of the following except:

    1. Present value
    2. Net present value
    3. Future value
    4. Internal rate of return
Complex Multiple-Choice (“Roman Numeral”) Format:

For this question type, you see a question followed by two or more statements identified by Roman numerals. The four answer choices represent combinations of these statements. You must select the combination that best answers the question.

Pick two statements that best represent time-weighted and dollar-weighted returns:

    1. Conceptually, the time-weighted return is the compounded growth rate of the initial investment over a given period of time, and is calculated using the geometric mean rather than the arithmetic mean.
    2. Conceptually, the dollar-weighted return is the compounded growth rate of the initial investment over a given period of time and is calculated using the geometric mean rather than the arithmetic mean.
    3. Conceptually, a time-weighted return is the internal rate of return on an investment.
    4. Conceptually, a dollar-weighted return is the internal rate of return on an investment.
    1. I and III
    2. I and IV
    3. II and III
    4. II and IV

This format is also used in items that ask you to rank or order a set of items from highest to lowest (or vice versa), or to place a series of events in the proper sequence.

Rank the following categories of mutual funds in order of volatility, from highest to lowest.

    1. Growth and income
    2. Balanced
    3. Growth
    4. Equity income
    1. I, III, II, IV
    2. III, II, I, IV
    3. III, I, II, IV
    4. III, I, IV, II

Answers: D, B, C, B, D

For an even better idea of the possible question types you might encounter on the Series 66 exam, try Solomon Exam Prep’s free Series 66 Sample Quiz.

How to Study for the Series 66 Exam

Follow Solomon Exam Prep’s proven study system:
    • Read and understand. Read the Solomon Study Guide, carefully. The Series 66 is a knowledge test, not an IQ test. Many students read the Study Guide two or three times before taking the exam. To increase your ability to focus while reading, or as an alternative to reading, listen to the Solomon Series 66 Audiobook, which is a word-for-word reading of the Study Guide.
    • Answer practice questions in the Solomon Exam Simulator. When you’re done with a chapter in the Study Guide, take 4–6 chapter quizzes in the Solomon Series 66 Online Exam Simulator. Use these quizzes to give yourself practice and to find out what you need to study more. Make sure you read and understand the question rationales. When you’re finished reading the entire Study Guide, review your handwritten notes once more. Then, and only then, start taking full practice exams in the Exam Simulator. Aim to pass at least six full practice exams and try to get your Solomon Pass Probability™ score to at least an 80%; when you reach that point, you are probably ready to sit for the Series 66 exam.
Use these effective study strategies:
    • Take handwritten notes. As you read the Study Guide, take handwritten notes and review your notes every day for 10 to 15 minutes. Studies show that the act of taking handwritten notes in your own words and then reviewing them strengthens learning and memory.
    • Make flashcards. Making your own flashcards is another powerful and proven method to reinforce memory and strengthen learning. Solomon also offers digital flashcards for the Series 66 exam.
    • Research. Research anything you do not understand. Curiosity = learning. Students who take responsibility for their own learning by researching anything they do not understand get a deeper understanding of the subject matter and are much more likely to pass.
    • Become the teacher. Studies show that explaining what you are learning greatly increases your understanding of the material. Ask someone in your life to listen and ask questions. If you don’t have anyone, explain it to yourself. Studies show that helps almost as much as explaining to an actual person (see Solomon’s previous blog post to learn more about this strategy!).
Take advantage of Solomon’s supplemental tools and resources:
    • Use all the resources. The Resources folder in your Solomon student account has helpful information, including a detailed study schedule that you can print out – or use the online study schedule and check off tasks as you complete them.
    • Watch the Video Lecture. This provides a helpful review of the key concepts in each chapter after reading the Solomon Study Guide. Take notes to help yourself stay focused.
  • Good practices while studying:
    • Take regular breaks. Studies show that if you are studying for an exam, taking regular walks in a park or natural setting significantly improves scores. Walks in urban areas or among people did not improve test scores.
    • Get enough sleep during the period when you are studying. Sleep consolidates learning into memory, studies show. Be good to yourself while you are studying for the Series 66: exercise, eat well, and avoid activities that will hurt your ability to get a good night’s sleep.

You can pass the NASAA Series 66 Exam! It just takes focus and determination. Solomon Exam Prep is here to support you on your path to becoming a registered securities agent and investment advisor representative.

To explore all Solomon Exam Prep’s Series 66 study materials, including product samples, visit the Solomon website here.

For more helpful securities exam-related content, study tips, and industry updates, join the Solomon email list. Just click the button below:

Pandemic Study Tip: Practice With a Mask

Since Prometric test centers now require test-takers to wear a mask when taking a securities exam Continue reading

Since Prometric test centers now require test-takers to wear a mask when taking a securities exam, Solomon Exam Prep recommends that individuals studying for a securities licensing exam — such as the SIE, the Series 7 or the Series 65 — take at least one practice exam at home wearing a mask. Solomon Exam Prep’s Exam Simulator offers quizzes and timed and untimed practice exams. Wearing a mask while using the Solomon Exam Simulator will better simulate the pandemic test center experience and help you prepare for your exam.

Solomon Exam Prep, a leader in FINRA, MSRB, NASAA and NFA securities licensing exams, has helped thousands pass the SIE and the Series 3, 6, 7, 14, 22, 24, 26, 27, 28, 50, 51, 52, 53, 54, 63, 65, 66, 79, 82 and 99.

Pepperdine and Solomon

Solomon Exam Prep is excited to announce that Pepperdine Graziadio Business School has chosen Solomon Exam Prep as its curriculum provider for its summer Securities Industry Essentials exam prep class. Continue reading

Solomon Exam Prep is excited to announce that Pepperdine Graziadio Business School has chosen Solomon Exam Prep as its curriculum provider for its summer Securities Industry Essentials exam prep class. The two-credit class for Pepperdine MBA students will begin on June 17 and will run for seven weeks.  It will be taught by Chris Manfre.

Royal baby eligible to take FINRA SIE Exam in 18 years

Buckingham Palace announced this week that the Duchess of Sussex, Meghan Markle, had given birth to a boy. The father, Prince Harry, said he was “absolutely thrilled” but said the couple hadn’t chosen a name yet. Continue reading

Buckingham Palace announced this week that the Duchess of Sussex, Meghan Markle, had given birth to a boy. The father, Prince Harry, said he was “absolutely thrilled” but said the couple hadn’t chosen a name yet.

Royal observers noted that the Queen’s latest grandchild is seventh in line to the throne, behind the Prince of Wales, the Duke of Cambridge and his children – Prince George, Princess Charlotte and Prince Louis – and Prince Harry. Given this, some suggested that the nameless royal tike could consider taking the FINRA Securities Industry Essentials (SIE) exam.
 
Jeremy Solomon, President of Solomon Exam Prep, agreed: “the SIE exam is an option for anyone 18 years and older, regardless of your nationality, title or regal heritage.” SIE exam topics include: equity securities, debt securities, mutual funds, options, hedge funds, risks, disclosure, taxation, securities markets, issuing securities, customer accounts, prohibited activities, rules and regulations.
 
Solomon Exam Prep has helped thousands of commoners, and perhaps a few royals, pass FINRA, NASAA and MSRB securities licensing exams including the SIE and the Series 3, 6, 7, 14, 24, 26, 27, 28, 50, 51, 52, 53, 54, 63, 65, 66, 79, 82 and 99.

Solomon Partners With Ohio Dominican University

Solomon Exam Prep—a leading publisher of securities exam prep materials—is proud to announce a partnership with Ohio Dominican University. Continue reading

February 1st, 2019

Solomon Exam Prep—a leading publisher of securities exam prep materials—is proud to announce a partnership with Ohio Dominican University. With this partnership, ODU students will get everything needed to pass the all-important SIE exam.

As FINRA’s “introductory” exam, the SIE is used by securities firms to measure the seriousness of job candidates. For years, Solomon’s instructors have helped professionals pass securities exams—and now they’ve drawn on this expertise to create the best possible SIE test-prep materials. Geared to a variety of learning styles, these include:

  • A digital study guide
  • An audiobook
  • Flashcards
  • Free mobile apps
  • An online exam simulator with unlimited quizzes and exams
  • A video lecture with slides and narration
  • Custom study schedules for classes or independent study

Perhaps most importantly, Solomon’s materials are complemented by personalized support. As one student noted, “I didn’t think this kind of customer service and general human kindness existed anymore.” The company’s dedication shows in its consistently high pass rates.

Partner instructors rave about Solomon’s materials as well—especially for featuring:

  • An online interactive admin portal where courses and student progress can be monitored (making “back-end faculty work a breeze,” as UN-Omaha’s Ray LeBlanc recently put it)
  • A curriculum tailored to fit the needs of each school and program
  • No expense to the partnering school beyond the study materials for the students

Contact us at 503.601.0212 to discuss setting up a Solomon partnership for your school—and to join such prestigious institutions as the University of Nebraska-Omaha, Adelphi University, Seton Hall University, and the University of Dallas.

Jeremy Solomon, Founder/President
jeremy@solomonexamprep.com

Beth Hamilton, Business Development
beth@solomonexamprep.com

 

About Solomon Exam Prep
Founded by Karen Solomon (Ph.D., University of Chicago) and Jeremy Solomon (MBA, Wharton), Solomon Exam Prep has helped thousands of students pass their series exams: Series 3, 6, 7, 24, 26, 27, 28, 50, 51, 52, 53, 62, 63, 65, 66, 79, 82 and 99.

Solomon Exam Prep

 

 

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503.601.0212

December Study Question of the Month

Submit your answer to info@solomonexamprep.com to be entered to win a $10 Starbucks gift card. Continue reading

Submit your answer to info@solomonexamprep.com to be entered to win a $10 Starbucks gift card.

Question

Relevant to the SIE.

Henry buys shares of ABC in an initial public offering.  Two months later he sells the shares to James.  Two months later James sells the shares to Carrie. Which of the following is true?
 
A. Henry’s sale to James is a primary market transaction, while James’s sale to Carrie is a secondary market transaction
B. Both Henry’s sale to James and James’s sale to Carrie are primary market transactions
C. Henry’s sale to James is a primary market transaction, while James’s sale to Carrie is a follow-on offering

D. Both Henry’s sale to James and James’s sale to Carrie are secondary market transactions

Answer: D. When an investor buys shares in an IPO from the issuer, the purchase is a primary market transaction.  After that, whenever sales of the security are traded from investor to investor, and not from the issuer to an investor, the sales take place in the secondary market.  Thus, while Henry’s initial purchase is a primary market transaction, his sale to James and then James’ sale to Carrie are both secondary market transactions.

Bring the SIE to Your Summer Internship Program

Summer internships offer firms a way to stay young and grow. Continue reading

The Securities Industry Essentials (SIE) exam comes bearing more gifts! Not only does the SIE help individuals break into the securities industry, it also provides some incredible opportunities for employers.

Summer internships offer firms a way to stay young and grow.

College students or recently graduated students are the future of your firm and the SIE makes it a lot easier to ensure your firm’s future is bright!

Since the SIE exam will not require BD employment or sponsorship or even a background check, what better way to help your interns succeed than have them study for the SIE exam! By giving your interns the chance to study for the SIE during your program, they will be ready to work for you full time upon graduation.

You can learn more about the SIE and Solomon here.

Solomon offers a complete SIE curriculum including online and print study materials.

Call 503-601-0212 to offer your summer interns the educational experience they will appreciate and value for the rest of their lives!

 

FINRA releases final SIE outline

FINRA released the final Securities Industry Essentials (SIE) exam content outline. Continue reading

Today FINRA released the final Securities Industry Essentials (SIE) exam content outline. The outline is an updated version of the draft that FINRA released as part of an earlier regulatory notice. This final content outline is now available on the FINRA website.

With the release of the SIE content outline, content outlines for the revised representative level (“top-off”) exams — the Series 6, Series 7, Series 22, Series 57 Series 79, Series 82, Series 86/87, and Series 99 — are expected to follow.

While FINRA has proposed a $60 fee for the SIE exam, it has yet to determine a passing score.

The SIE is expected to launch October 1.

For more information about the SIE or other FINRA, NASAA or MSRB securities licensing exams, visit www.solomonexamprep.com or give us a call at 503-601-0212.

FINRA Proposes $60 Fee for Securities Industry Essentials (SIE) Exam

As the Securities Industry Essentials (SIE) exam looms in the distance, FINRA is moving full steam ahead to ready the exam for its October 1 launch. Continue reading

On December 20, 2017, FINRA held its Board of Governors Meeting to discuss rule proposals and the 2018 budget. One rule that was addressed was the fee for the Securities Industry Essentials (SIE) exam. FINRA chose a fee of $60 for the exam. This rule change will be filed with the SEC and await approval sometime in the new year.

The $60 fee is considerably less than the $100 fee for the Series 6 and the $305 fee for the Series 7 exam. FINRA’s meeting notes report that the price for other exams will be reevaluated as well, to adhere to the changing securities landscape.

Jeremy Solomon, President of Solomon Exam Prep, responded to the proposed fee:

“This is another indication of how serious FINRA and the industry is about making the SIE exam as user-friendly and available as possible. Kudos to FINRA.”

For more information about the SIE or other FINRA, NASAA or MSRB securities licensing exams, visit www.solomonexamprep.com or give us a call at 503-601-0212.