Navigating the preparation for the FINRA Series 86 and 87 exams can be both exciting and challenging for aspiring equity research analysts. These exams are crucial for anyone looking to advance in the field of securities research and analysis. To help candidates better understand what to expect, we’ve compiled a list of frequently asked questions. This guide addresses common concerns about the preparation process, exam difficulty, retake policies, and career opportunities, providing you with the essential information needed to approach your studies with confidence and clarity. Refer to the Series 86 and 87 content outline here
For more information about the SIE and Series 86 and 87 exams, refer to FINRA Rule 1210 and FINRA Rule 1220(b)(6).
What are the Series 86 and 87 exams?
The Series 86 and 87 exams are FINRA-administered qualifications required for individuals seeking to become equity research analysts. The Series 86 exam covers the analysis of equity securities, including financial statements, valuation methods, and financial modeling. The Series 87 exam focuses on the regulatory framework for equity research, including compliance, communication rules, and conflicts of interest. Together, they certify a candidate’s ability to perform equity research and adhere to industry regulations.
How long does it take to prepare for the Series 86 and 87 exams?
Preparation time varies depending on individual experience and study habits. On average, candidates spend about 100-150 hours preparing for the Series 86 exam and 50-100 hours for the Series 87 exam. It’s important to create a study plan that allows for thorough review of all relevant topics and includes time for practice exams to gauge your readiness.
How difficult are the Series 86 and 87 exams?
Both the Series 86 and 87 exams are considered challenging. The Series 86 requires in-depth knowledge of financial analysis, valuation methods, and financial statements, while the Series 87 focuses on regulatory compliance and research ethics. Success in these exams demands a strong grasp of both technical and regulatory concepts, so thorough preparation is essential.
Can I retake the Series 86 and 87 exams if I fail?
Yes, you can retake the Series 86 and 87 exams if you do not pass. After the first and second attempts, there is a 30-day waiting period before you can retake the exam. If you need to attempt a third time or more, the waiting period extends to 180 days between attempts. This policy allows candidates time to review and improve their knowledge.
What are the prerequisites for taking the Series 86 and 87 exams?
To take the Series 86 and 87 exams, you must be sponsored by a FINRA-member firm. This sponsorship is necessary as it validates your association with a registered entity and ensures you meet the regulatory requirements for taking these exams. Additionally, you must have passed the Series 7 exam before you can sit for the Series 86 and 87 exams.
How many questions are on the Series 86 and 87 exams?
The Series 86 exam consists of 100 multiple-choice questions, while the Series 87 exam includes 50 multiple-choice questions. The Series 86 exam is designed to test your knowledge of equity analysis and valuation, whereas the Series 87 focuses on research regulations and compliance.
What is the passing score for the Series 86 and 87 exams?
The passing score for the Series 86 exam is 70%, while the passing score for the Series 87 exam is 74%. Achieving these scores requires a solid understanding of the material and the ability to apply your knowledge effectively in exam scenarios.
How much does it cost to take the Series 86 and 87 exams?
The cost to take the Series 86 exam is $185, and the Series 87 exam costs $130. These fees are non-refundable and are required to be paid at the time of registration for the exams.
What study materials are recommended for the Series 86 and 87 exams?
Recommended study materials include official FINRA study guides, textbooks from providers like Kaplan and Wiley, and online prep courses. Utilizing practice exams and review courses can also be beneficial in reinforcing your knowledge and exam readiness.
How can I schedule the Series 86 and 87 exams?
You can schedule the Series 86 and 87 exams through the FINRA website or by contacting Prometric, the testing provider. Scheduling should be done well in advance to secure your preferred date and time slot.
What topics are covered on the Series 86 exam?
The Series 86 exam covers topics such as financial statement analysis, valuation methods, financial modeling, economic indicators, and the role of equity research. It is designed to test your ability to analyze and interpret financial data for equity securities.
What topics are covered on the Series 87 exam?
The Series 87 exam focuses on topics related to equity research regulations, including communication rules, conflicts of interest, and compliance with FINRA regulations. It is intended to ensure that candidates understand the regulatory framework governing equity research.
Are there any continuing education requirements after passing the exams?
Yes, there are continuing education requirements. Registered individuals must complete periodic regulatory element training to stay current with industry practices and regulatory changes. This ensures ongoing professional development and adherence to evolving standards.
What is the career prospect after passing the Series 86 and 87 exams?
Passing the Series 86 and 87 exams opens career opportunities as equity research analysts, investment analysts, and financial analysts. These roles involve analyzing securities, preparing research reports, and providing investment recommendations, which are highly valued in the finance industry.
What is the exam format for Series 86 and 87?
Both the Series 86 and 87 exams are multiple-choice and administered electronically at designated testing centers. The format requires candidates to select the best answer from a list of options, testing their knowledge and analytical skills.
Can the Series 86 and 87 exams be taken online?
Currently, the Series 86 and 87 exams must be taken at approved Prometric testing centers. Online testing is not available for these exams, so you will need to schedule and attend the exam in person.
What are the alternatives to Series 86 and 87 certifications?
Alternatives to the Series 86 and 87 certifications include the Chartered Financial Analyst (CFA) designation, which covers a broader range of financial analysis topics, and other relevant certifications such as Series 7 and Series 66 exams, which are also valuable for finance professionals.
Is work experience required to take the Series 86 and 87 exams?
Work experience is not a formal prerequisite to take the Series 86 and 87 exams, but relevant experience in financial analysis or research can be highly beneficial in understanding the material and applying concepts effectively.
What are the key strategies for passing the Series 86 and 87 exams?
Key strategies for passing include creating a structured study plan, utilizing high-quality study materials, taking practice exams, and focusing on areas of weakness. Regular review sessions and joining study groups can also enhance your preparation and understanding of the exam content.
How do I find a study group or prep course for the Series 86 and 87 exams?
You can find study groups and prep courses through online forums, professional networking sites, or by contacting financial education providers. Many companies offer specialized prep courses and study groups designed to help candidates succeed in their exams.
What is the time limit for completing each exam?
The Series 86 exam must be completed within 3 hours, while the Series 87 exam has a time limit of 2 hours. Managing your time effectively during the exam is crucial to ensure you complete all questions within the allotted timeframe.
How often are the Series 86 and 87 exams updated?
The Series 86 and 87 exams are updated periodically to reflect changes in regulations, industry practices, and financial concepts. Staying current with these updates is essential for successful exam preparation and ensuring compliance with the latest standards.
What should I do if I need special accommodations for the exam?
If you need special accommodations, you should request them through Prometric or FINRA well in advance of your exam date. Provide documentation supporting your request, and ensure that your accommodations are confirmed before scheduling your exam.
Are there any practice exams available for Series 86 and 87?
Yes, practice exams are available through various study material providers and online platforms. These practice exams can help you familiarize yourself with the exam format, assess your knowledge, and identify areas where you may need additional study.
What are the most common mistakes candidates make on these exams?
Common mistakes include insufficient preparation, not understanding the exam format, and mismanaging time during the test. Candidates often struggle with questions related to regulatory details and complex financial models if they haven’t reviewed these areas thoroughly.
How do the Series 86 and 87 exams fit into my overall career path?
The Series 86 and 87 exams are critical for anyone pursuing a career in equity research analysis. They validate your expertise in financial analysis and regulatory compliance, making you eligible for roles such as equity research analyst and financial analyst, and enhancing your career prospects in the finance industry.
What should I expect on the day of the exam?
On exam day, arrive at the testing center early with appropriate identification. You will be required to follow security procedures, including a check-in process and possibly biometric verification. The exam will be administered electronically, and you should be prepared to manage your time effectively throughout the test.
Can I use a calculator during the Series 86 and 87 exams?
A basic calculator will be provided at the testing center for the Series 86 exam. However, no calculator is allowed or needed for the Series 87 exam, as it focuses more on regulatory and compliance issues rather than complex calculations.
How do I handle exam anxiety or stress?
To handle exam anxiety or stress, practice relaxation techniques such as deep breathing, ensure you are well-prepared, and adopt a positive mindset. Regular study sessions, mock exams, and maintaining a balanced routine can also help reduce stress and boost confidence.
What are the next steps after passing the Series 86 and 87 exams?
After passing the Series 86 and 87 exams, you will need to complete the registration process with FINRA and fulfill any additional requirements set by your sponsoring firm. This includes potentially engaging in further training and adhering to ongoing professional development to maintain your registration.
