What is the 'Series 65'
The Series 65 is a securities license required by most U.S. states for individuals who act as investment advisors. The Series 65 exam, called the Uniform Investment Adviser Law Examination, covers laws, regulations, ethics and topics such as retirement planning, portfolio management strategies and fiduciary responsibilities. The exam itself is administered by FINRA.
BREAKING DOWN 'Series 65'
Successful completion of the Series 65 exam qualifies an investment professional to function as an Investment Adviser Representative in certain states. Other FINRA administered qualification examinations include Series 3 National Commodity Futures (CR); Series 7 General Securities Representative (GS); and Series 63 Uniform Securities Agent State Law.
Series 65 Exam Structure
The Series 65 examination contains 130 multiple choice questions. Candidates sitting for the exam have a time limit of 180 minutes to finish all 130 questions. In order to obtain a passing grade, candidates must get 94 of the 130 questions correct, a score of 72.3%. The person administering the exam provides candidates with a basic electronic calculator. Only this calculator may be used during the exam. A dry-erase whiteboard and marker are also provided for candidates. No reference materials of any kind are permitted in the exam room, and there are severe penalties for those who are caught attempting to cheat. An individual's firm can schedule a candidate to take the exam by filing a Form U4 or Form U-10 and paying the $155 examination fee.
Series 65 Exam Content
The North American Securities Administrators Association provides updated information of the exam's content on its website. Currently the exam questions are allocated as follows:
Economic Factors and Business Information (14%): Topics include monetary and fiscal policy, economic indicators, financial reporting, quantitative methods and basic risk concepts.
Investment Vehicle Characteristics (34%): Topics include cash and cash equivalents, fixed income securities, methods of fixed income valuation, equities and methods used to in equity valuation, pooled investments, derivative securities and insurance-based products.
Client Investment Recommendations and Strategies (31%): Topics include individuals, business entities and trusts, client profiles, capital market theory, portfolio management styles, strategies and techniques, tax considerations, retirement planning, ERISA issues, special types of accounts, trading securities, exchanges and markets, and performance measurement.
Laws, Regulations, and Guidelines, Including Prohibition on Unethical Business Practices (31%): Topics include state and federal securities acts, rules and regulations for investment advisers, investment adviser representative, broker-dealers, and agents, ethical practices, and fiduciary obligations, including communications with clients, compensation, client funds and conflicts of interest.