Series 63 State Law Exam

Ready to operate across state lines as a securities professional?

The State-Level Securities License

Don’t let state lines limit your career potential! The Series 63 exam, formally the Uniform Securities Agent State Law Examination, is the key to operating legally in most states. Developed by NASAA and run by FINRA, passing this exam shows you’ve mastered the crucial state securities laws and ethical guidelines, equipping you to confidently serve clients across the country.

Why is the Series 63 Necessary?

While federal licenses like the Series 7 grant broad authority to transact securities business, each state also has regulations designed to protect investors within its borders. The Series 63 exam tests your knowledge of these state laws, primarily based on the Uniform Securities Act (USA) – a model law adopted by most states. Passing demonstrates your understanding of state registration requirements, ethical obligations, and prohibited practices, ensuring you can operate legally and ethically within specific state jurisdictions.

Who Needs the Series 63 Exam?

If your sights are set on roles where you’ll directly advise clients on securities or manage their investments – think positions like registered representative, financial advisor, or working in wealth management – this state-level license becomes essential. It specifically authorizes you to engage with clients residing in different states, ensuring your work aligns with their local legal framework. Consider it this way, after building your foundation with the SIE and a core license like the Series 6 or 7, the Series 63 is often the key to unlocking your ability to operate and serve clients effectively across the country.

No Sponsorship Required!

Unlike the Series 7, you do NOT need to be sponsored by a FINRA member firm to take the Series 63 exam. Anyone 18 or older can register for and take this exam independently. This allows you to add another valuable qualification to your resume even before securing employment, demonstrating initiative and foundational knowledge of state regulations to potential employers.

Exam Scope and Content: State Law & Ethics Focus

The Series 63 exam zeroes in on the rules governing securities professionals at the state level, primarily derived from the Uniform Securities Act (USA). Unlike federal exams focusing heavily on products, the Series 63 tests your understanding of how states regulate the industry to protect investors within their borders.

You can expect the exam to cover four crucial areas:

• State Registration: Knowing who (like agents and broker-dealers) and what (specific securities) needs to be registered in a state, and understanding the exemptions.
• Ethical Conduct & Obligations: This is a major focus, covering your fiduciary duties, identifying and avoiding conflicts of interest, understanding prohibited business practices (both unethical mistakes and outright fraud), rules for handling client funds, and even cybersecurity awareness.
• Client Communication: How you interact with clients matters. This includes regulations on advertising, required disclosures, correspondence rules, and avoiding misleading statements.
• State Administrator Powers: Understanding the authority of the state’s securities regulator, including their ability to enforce rules and the potential consequences for violations.

Series 63 Exam Topic Breakdown:

Exam Structure and Logistics

• Format: 60 scored multiple-choice questions (+ 5 unscored pretest items).
• Duration: 1 hour 15 minutes (75 minutes).
• Passing Score: 71.7% (requires correctly answering 43 of the 60 scored questions).
• Cost: $147 (exam fee).
• Administration: Computer-based test administered via Prometric.

Maintaining Your Qualification

Keep in mind that passing the exam allows for state registration. NASAA also offers an Exam Validity Extension Program (EVEP) in participating states, allowing you to maintain the validity of your passing score for up to five years (even if not registered) by completing annual continuing education. This can be beneficial if there’s a gap between passing the exam and becoming registered or between jobs.