What Is the Series 57 License?

A Series 57 license allows brokers to trade equities and convertible debt securities in the U.S. To obtain one, you must pass the Series 57 exam. This test covers topics like equity trading concepts and regulations around the financial services industry. The Financial Industry Regulatory Authority (FINRA) administers the exam. It can be an important certification for financial professionals looking to boost their capabilities and earnings.

A financial advisor can help you design an investment portfolio that tracks to your long-term goals.

What Is the Series 57 License?

The Series 57 license permits brokers to engage in Nasdaq, New York Stock Exchange (NYSE), over-the-counter (OTC) and proprietary trading. A person generally holds a Series 57 license for a broker-dealer firm in the U.S. to employ him or her. In fact, these companies must register with FINRA.

FINRA also administers the prerequisite exam for the Series 57 license. The exam is structured as a multiple-choice test designed to assess your ability to engage competently in your day-to-day tasks as an entry-level equity trader.

Prior to 2016, the Series 57 exam existed as the Series 55 exam. However, FINRA changed the exam to reflect high-frequency trading best practices. The organization also aimed to tighten regulations and protect investors by placing stricter standards on equity traders.

Series 57 Exam Prerequisites and Requirements

Before taking the Series 57 exam, you must pass the Securities Industry Essentials (SIE) exam. In addition, you have to be employed by a firm that’s a member of FINRA. However, if you passed the Series 55 or Series 56 before the update that went into effect in January 2016, you don’t have to take the Series 57 test. Instead, you’d be grandfathered in. ¹

Series 57 Exam Structure

You take the Series 57 exam on a computer, but cannot access any reference material during the test. You are provided with writing material and a basic calculator, though. Here are the basics for the Series 57 Exam:

• Questions: 50
• Duration: 105 minutes
• Passing Score: 70% ²

You should answer every question as there is no penalty for guessing. The breakdown of content areas is as follows:

• Trading Activities: 82% (41 Questions)
• Trade Reporting, Record Keeping, Clearance and Settlement: 18% (9 questions) ³

How to Pass the Series 57 Exam

Because the Series 57 test is fairly new, there are not many study materials out there. Nonetheless, you should get your hands on some. Your firm may provide these to you. Or you can search online. Some programs combine textbooks with video and interactive content.

Below, we list some tips to guide you in your studies

• Read the entire book
• Take practice exams and answer practice questions
• Review the answers you got wrong
• Reflect on the chapters you found most difficult
• Study for several hours
• Don’t cram, but understand all concepts detailed in the study material
• Take extensive notes

Some questions also deviate from equity trading best practices. For example, they might cover topics like retirement and margin accounts. However, ultimately the right way to pass the exam will depend on your own strengths and weaknesses.

Series 57 Exam Day

Aim to arrive at the testing center at least 30 minutes before the scheduled start time. This will provide you with ample time to complete the entire registration process successfully. In addition to reference material you also cannot bring personal items including:

• Watches
• Large Jewelry
• Phones
• Books
• Briefcases
• Backpacks

However, you will be provided with a four-function calculator, a dry-erase board and dry-erase pens. You may need these, as some questions require the use of charts, graphs and tables. If you arrive more than 30 minutes late to the exam site, you cannot take it that same day. ⁴

Can I Take the Series 57 Exam Twice?

Generally, FINRA allows you to retake the Series 57 exam 30 days after you first took it. But if you have failed the test at least three times in a row, you must wait at least 180 days before retaking it. If you’re employed by a FINRA member firm, your company must request the exam on your behalf through Web CRD ⁵ .

After Taking the Series 57 Exam

You take the test on a computer and get your test results briefly after completing and submitting your answers. If you pass, you’ll be notified but won’t get additional details about your exam, but you also won’t need those details since you’ll be ready to receive your Series 57 license.

Test-takers who fail receive a detailed report. You should refer to this in order to figure out what topics and sections you should spend more time studying before you take the exam another time. It’s important to make sure you look at your study practices the first time if you need to re-take the exam so that you are actively making the right changes to see yourself succeed next time.

Series 57 vs. Other FINRA Licenses: Which One Do You Need?

The Series 57 is one of several FINRA licenses available to financial professionals, and choosing the wrong exam wastes time and money. Each license authorizes a different set of activities, and the one you need depends on the specific role you are pursuing, not just your general interest in the securities industry.

The Series 57 is designed for equity traders who execute transactions on Nasdaq, NYSE, OTC and proprietary trading desks. It qualifies you to place and manage trades, but it does not authorize you to recommend investments to clients or provide financial advice. If your goal is to sit on a trading desk and execute orders, the Series 57 is the right exam. If your goal is to advise clients on their portfolios, it is not.

Series 7

The Series 7 is a general securities license that covers a much broader range of products and activities. A Series 7 holder can sell stocks, bonds, mutual funds, ETFs, options and government securities, and can make recommendations to clients. Most financial advisors and registered representatives at broker-dealer firms hold the Series 7. It is a longer, more comprehensive exam and qualifies you for a wider set of roles. Holding a Series 7 does not replace the Series 57 if your firm requires you to function as an equity trader, and holding a Series 57 does not replace the Series 7 if your role involves client-facing investment recommendations.

Series 63 and Series 66

The Series 63 and Series 66 handle state-level registration. The Series 63 is required in most states for anyone selling securities and focuses on state securities laws and ethical obligations. The Series 66 combines the Series 63 and Series 65 into one exam and is typically paired with the Series 7 for advisors who both sell securities and provide investment advice. Equity traders holding a Series 57 may also need the Series 63 depending on their state and the nature of their firm’s business.

All of these exams require passing the Securities Industry Essentials (SIE) exam first. The SIE covers foundational knowledge of the securities industry and can be taken before you are sponsored by a firm. If you are not yet sure which direction your career will take, passing the SIE first gives you a head start regardless of which top-off exam you eventually pursue. From there, your firm will typically tell you which specific license your role requires, but understanding the differences before you interview helps you target the right firms and positions from the start.

What a Career as an Equity Trader Actually Looks Like

Passing the Series 57 qualifies you to trade equities, but the exam does not tell you much about what the job feels like day to day. Equity trading is a fundamentally different career from financial advising, portfolio management, or investment banking, and understanding those differences before you commit to the path matters.

Day-to-Day Responsibilities

An equity trader’s day starts before the market opens. You review overnight news, earnings reports, economic data and pre-market price movements to anticipate how the trading session will unfold. Once the market opens, the pace accelerates. You are executing buy and sell orders, monitoring positions, managing order flow, and reacting to real-time price changes across multiple screens. The work is fast, constant and driven by the clock. There is no pausing to think through a recommendation over lunch. Decisions happen in seconds, and mistakes are immediately visible in the profit and loss column.

The role splits broadly into two types. Agency traders execute orders on behalf of clients, which means your job is to get the best possible price and execution for someone else’s trade. You are measured on execution quality, speed, and how well you minimize market impact. Proprietary traders use the firm’s own capital to take positions based on market analysis, pricing models or short-term opportunities. You are measured on how much money you make for the firm. Some roles blend both, but the distinction matters because the skills, pressure and compensation structure differ significantly between the two.

Compensation and Career Path

Compensation for entry-level equity traders varies by firm size, location and whether the role is agency or proprietary. At larger broker-dealer firms, base salaries for junior traders typically start in the range of $100,000, ⁶ with bonuses tied to desk performance and individual contribution. At proprietary trading firms, base salaries may be lower but the bonus potential can be significantly higher if the desk is profitable. Performance is measured in concrete terms. Revenue generated, execution quality, error rates and risk management are all tracked and directly affect your compensation and career advancement.

Career progression typically moves from junior trader to senior trader to desk manager over a period of five to ten years, depending on performance and the size of the firm. Some traders eventually move into portfolio management, risk management, or trading technology roles. Others build expertise in a specific asset class or market and become specialists that firms rely on for complex execution. Unlike financial advisory careers where client relationships and assets under management drive growth, trading careers advance based on measurable performance and the ability to handle larger and more complex positions over time.

The work environment is high-pressure and not for everyone. Trading floors are loud, fast and unforgiving when things go wrong. The hours are tied to market hours, which means early mornings and limited flexibility during the trading day. Burnout is a real factor in the industry, and many traders transition out of execution roles after ten to fifteen years. If you thrive under pressure, think quickly, and want a career where your results are measured in real time, equity trading is a strong fit. If you prefer building long-term client relationships, working at your own pace or having flexibility in your schedule, a different path in financial services may suit you better.

Bottom Line 

You need your Series 57 license to trade equities as a broker. To obtain it, you have to take a rigorous exam designed to assess your ability to complete common tasks required of entry-level brokers. It would also cover the latest regulations you must abide by. The test-makers want the test to be tricky, so careful studying is key. You can find some study materials online but ultimately the right way to prepare will depend on your own strengths and weaknesses.

Tips on Taking the Series 57 Exam

• If you’d like some professional help understanding how money management works then you may want to seek the advice of a professional financial advisor. If you don’t have a financial advisor, finding one doesn’t have to be hard. SmartAsset’s free tool matches you with up to three vetted financial advisors who serve your area, and you can interview your advisor matches at no cost to decide which one is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
• Try to study as many hours as you can, but don’t cram. Try to understand what the concepts around the study material really mean and how you’d apply it in practice. You should apply similar study habits to those you employed when taking the Series 7 exam.

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