Rules and Regulations Covered on the Series 7 Exam

By Steven M. Rice

The Series 7 exam is riddled with rules and regulations. And believe it or not, they’re not just in the section covering rules. Unfortunately, you do have to remember specifics. But don’t fear: A lot of the rules make sense, and the correct answer usually stands out like a sore thumb.

Practice questions

  1. Registered reps must complete the regulatory element of continuing education within __________ days of their registration anniversary date.

    A. 30

    B. 60

    C. 120

    D. 270

    Answer: C. 120

    Under Financial Industry Regulatory Authority (FINRA) rules, all registered reps must complete their computer-based regulatory element of their continuing education within 120 days of their second anniversary of becoming a registered rep and every third anniversary after.

  2. A licensed registered representative has left the securities industry to pursue his life-long ambition to become a mixed martial artist.

    If he decides he made a mistake and wants to return to the securities industry, he will have to retake his securities exams if he has been unaffiliated with his broker-dealer for more than

    A. one year

    B. two years

    C. three years

    D. five years

    Answer: B. two years

    After an individual has been unaffiliated with a broker-dealer for more than two years, his licenses are no longer valid, and he’d have to take the licensing exams again.

  3. Joe Silber failed the Series 7 exam three consecutive times. How long must Joe wait before making a fourth attempt?

    A. 30 days

    B. 45 days

    C. 90 days

    D. 6 months

    Answer: D. 6 months

    The rules for taking FINRA exams are as follows:

    • If you fail an exam once, you have to wait 30 days before another attempt.

    • If you fail the exam twice, you have to wait 30 days before another attempt.

    • If you fail the third time, you have to wait six months before another attempt.

    So make sure you’re ready to pass the first time so you don’t have to worry about those rules.