Series 57

The Series 57 exam, also known as the Securities Trader Representative exam , is a test that financial professionals must pass to engage in securities trading.

This exam is administered by the Financial Industry Regulatory Authority (FINRA) and aims to assess the competency of an entry-level registered representative.

This article provides an overview of the Series 57 exam and aims to help you understand the professional requirements you’ll need to satisfy in order to obtain and maintain this license.

What is the Series 57 License?

The Series 57 exam is a certification required for individuals who want to engage in securities trading. Having this license ensures that traders have the necessary knowledge and skills to comply with regulatory requirements.

Securities trader representatives are allowed to engage in these activities: NASDAQ equity trading, OTC (over-the-counter) equity trading, and proprietary trading.

All in all, getting a Series 57 license can be a good idea if:

• You aim to become a professional trader: For a career in securities trading, this license is mandatory
• You work for a financial firm. Many firms require this license to ensure that their employees adhere to industry standards
• You want to boost your credibility. Obtaining the Series 57 license demonstrates your commitment to professional development and your understanding of trading practices and regulations
• You are interested in specialized trading roles. The license opens doors to more specialized roles in trading, like proprietary trading or hedge fund management

This license is essential for anyone aiming to pursue a career in securities trading, ensuring that you are well-equipped with the knowledge and skills to succeed in this highly-regulated financial services industry.

How to Get Your Series 57 License

Before taking the Series 57 exam, you must meet the following requirements:

• Have an association and sponsorship with a FINRA member firm or another applicable self-regulatory organization (SRO)
• Pass the Securities Industry Essentials (SIE) Exam
• Have an approved accommodation to set up an online appointment

If you meet the license requirements, you must register for and pass the exam. This exam will evaluate your understanding of securities trading, including equity, options, and compliance with industry regulations and ethical standards.

Exam Preparation and Procedure

The Series 57 (Securities Trader Representative Exam) is aimed at entry-level traders and financial professionals who need to demonstrate competence in trading practices.

The exam will cover the major job functions of a securities trader representative, including trading activities, maintaining books and records, trade reporting and clearance, and settlement.

Is the exam challenging? Yes, it’s considered demanding as it requires a deep understanding of various trading concepts and regulations.

To pass the exam on your first try, consider taking these steps:

• Study the exam content: Understand the topics covered, including equity and options trading, market regulations, and trading practices. The exam consists of 50 multiple-choice questions, and you are given 105 minutes to complete the test
• Invest in a prep course: Use reputable study guides or courses tailored to this exam to reinforce your understanding. Prep courses are either self-paced or instructor-led, with simulated tests and videos
• Practice with sample questions: Engage in mock exams and practice questions to gauge your readiness and familiarize yourself with the exam format
• Allocate sufficient study time: Create a study schedule that allows adequate time for comprehensive preparation, and stick to it, ensuring you cover all necessary material

We recommend using online study resources and tools for the exam can be highly beneficial, providing targeted practice, interactive learning, and access to expert guidance, all of which can enhance understanding and readiness for the test.

Maintaining Your License

Staying ahead in the fast-paced world of securities trading means keeping your license current and your knowledge sharp.

Here are some ways to ensure your license is up-to-date:

• Complete continuing education: Continuing education (CE) can keep you updated with the latest industry trends, regulations, and best practices. FINRA administers the CE, which consists of two mandatory programs: the Regulatory Element and the Firm Element
• Stay updated on industry regulations: Always comply with relevant laws and trading regulations. Stay informed on the latest changes in rules and industry standards
• Join professional networks: Being part of professional financial networks or forums can provide insights, support, and updates from fellow professionals. This interaction fosters continuous learning and awareness of industry changes
• Use technology and tools: Embrace modern trading tools, analytics, and software that provide competitive advantages. Staying technologically savvy ensures that you’re maximizing your trading efficiency

Maintaining your license is an ongoing process that involves constant learning, compliance with ethical practices, and leveraging the community and technology. Continually honing your skills ensures not only compliance but also success in your securities trading role.