Financial professionals seeking to gain more knowledge and expertise might look to exams and licenses to complete for further education and skills. For some, taking the General Securities Principal Qualification Examination — or Series 24 exam — will be helpful. Here’s what it does and who should take it.
What is the Series 24 Exam and License?
The Series 24 Exam and license tests the knowledge of candidates who are looking to manage general securities at a broker-dealer. To qualify for a principal registration, you’ll need to pass the Series 16 Exam — or the Supervisory Analysts Exam — as well as the Securities Industry Essentials (SIE) Exam.
The Financial Industry Regulatory Authority (FINRA) administers the exam. It covers market making activities, investment banking and research, and general broker-dealer activities. It also reviews broker-dealer and personnel management activities.
It’s designed to test the competency of entry-level general securities principals to make sure those who hold the position are qualified to do their job. Those who pass are qualified to supervise and manage:
- Market making
What’s in the Series 24 Exam?
There are 150 questions and candidates have three hours and 45 minutes to complete the exam. Exam takers need at least a 70% to pass, or 105 correct answers.
There are five separate sections of the exam, including:
- Supervision of Registration of the Broker-Dealer and Personnel Management Activities. Candidates must differentiate between Registered Investment Advisers (RIA) and broker-dealers, as well as their required registrations. Theyl’ll also need to know registration requirements, exemptions and hiring requirements for specific positions.
- Supervision of General Broker-Dealer Activities. Candidates develop and implement a firm’s policies and procedures. Also, they turn to regulatory requirements to manage conflicts of interest, develop and deliver broker-dealer products, and manage a firm’s disciplinary actions, books and records.
- Superising Retail and Institutional Customer-Related Activities. Candidates handle new account openings, maintenance of existing accounts, review public-facing communications, review securities transactions and make sure the appropriate disclosures are made.
- Supervision of Trading and Market Making Activities. Candidates, must detail supervision of order entry and execution, confirm bookkeeping and settlements of trades are accurate and go over executions to check for compliance.
- Supervision of Investment Banking and Research. Finally, candidates develop and maintain the firm’s policies, procedures and controls. Also, the supervise related investment banking activities, review investor disclosure materials, and supervise research.
The computerized exam includes 10 random, unscored questions throughout the entire test. That means the total number of questions is 160, but 10 of them don’t count towards your final score.
You’ll have access to a whiteboard with dry-erase markers as well as simple electronic calculators. You won’t be allowed to take any of your personal belongings with you and reference materials are prohibited.
FINRA has a content outline you can use to study for the Series 24 Exam. The exam fee is $120.
Eligibility for the Series 24 Exam
To take the test, you’ll need to be associated with and sponsored by a FINRA member firm or a self-regulatory organization. You must also first qualify as one of the following:
- General Securities Representative (Series 7)
- United Kingdom Module of Series 7 (Series 17)
- Canada Module of Series 7 (Series 37 or 38)
- Securities Trader Representative (Series 57)
- Corporate Securities Limited Representative (Series 62)
- Investment Banking Representative (Series 79)
- Private Securities Offerings Representative (Series 82)
For financial professionals that are looking to gain knowledge and expertise in General Securities Principals, the Series 24 Exam and license is an important step to take. It’s a critical exam to test critical functions of a principal, so if that’s not your goal, you might want to skip taking it.
Keep in mind that the more certifications and licenses you have, the more in-demand you could be as a financial professional. If you have the opportunity to take the exam, it could work in your favor to move up within a firm and increase your salary.
Exam Prep Tips
- While FINRA’s exam outline is one way to prepare for the Series 24 exam, it’s not the only preparation you should take. You might want to consult the expertise of someone who’s taken the exam before. You could ask around at your firm or others in the industry. Or you could ask another advisor or financial planner. Finding the right financial advisor that fits your needs doesn’t have to be hard. SmartAsset’s free tool matches you with financial advisors in your area in 5 minutes. If you’re ready to be matched with local advisors that will help you achieve your financial goals, get started now.
- If the Series 24 Exam isn’t a need for your financial track, you still might want to look into other certifications. There’s the Series 99 exam, plus a handful of financial certifications you may obtain. Not all financial certifications, licenses, and exams are the same. Many have different eligibility requirements to qualify. Before taking any test, review the requirements and if you’re a good candidate. Since each certification has a different set of requirements and skills, consider ones that best suit your needs.
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