What Is the Series 24
The Series 24 is an exam and license entitling the holder to supervise and manage branch activities at a broker-dealer. The Series 24 exam is administered by the Financial Industry Regulatory Authority (FINRA) and covers topics such as corporate securities, real estate investment trusts, trading, customer accounts and regulatory guidelines. The Series 24 exam has the Securities Industry Essentials (SIE) exam as a corequisite, as well as a representative-level qualification exam.
Breaking Down Series 24
The Series 24 exam, also known as the General Securities Principal Qualification Examination, was designed to test the knowledge and competency of candidates aiming to become entry-level securities principals. Supervisory activities allowed after passing the exam include regulatory compliance over trading and market-making activities, underwriting, and advertising.
In order to be eligible for a principal registration, a candidate must pass the Series 24, SIE and one of the following representative-level exams: Series 7, 57, 79, 82, or 86/87. As well, candidates can pass the Series 24 and Series 16, but not the SIE and qualify for the Research Principal registration.
Series 24 Exam Details
The examination contains 150 scored questions and 10 questions that are not scored. The 10 questions that are not scored are randomly distributed through the exam. To successfully pass the exam, a candidate must correctly answer at least 105 questions of the 150 scored questions. This equates to a score of 70%. The test administrator provides electronic calculators and dry-erase boards and markers. No other calculators, reference or study materials are permitted in the examination room.
Candidates have a maximum time of three hours and 45 minutes to complete the exam. A FINRA member firm or other applicable firms can register a candidate to take the exam by filing a Form U4 and paying the $120 examination fee.
Series 24 Content Outline
The Series 24 content is grouped into the five main job functions that a general securities principal engages in regularly at work. Those job functions include:
- Supervision of Registration of the Broker-Dealer and Personnel Management Activities (9 questions): Includes regulatory requirements and exemptions, differences between various registrations, hiring and registration of associated persons and maintenance of registrations.
- Supervision of General Broker-Dealer Activities (45 questions): Includes development, implementation and updating of firm policies, written supervisory procedures and controls. Also includes supervision of conduct of associated persons, disciplinary action, supervision of compensation, and development, evaluation and delivery of products and services.
- Supervision of Retail and Institutional Customer-Related Activities (32 questions): Includes supervision of new account opening and maintenance of existing accounts as well as monitoring of speaking engagements and other public communication. In addition, includes the review of transactions, recommendations and account activity for proper disclosures.
- Supervision of Trading and Market Making Activities (32 questions): Includes supervision of order entry, routing and execution, as well as the proper booking and settlement of trades and the review of executions for compliance.
- Supervision of Investment Banking and Research (32 questions): Includes the development and maintenance of policies, procedures and controls related to investment banking activities and research. Entails the review and approval of investor disclosures, pitch books and marketing materials.
For more, see FINRA's General Securities Principal Qualiication Examination (Series 24) Content Outline.