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Finra Series-63 Exam Questions
- Topic 1: Definitions of Investment Advisers: This section of the exam measures the skills of compliance officers and covers the definitions of investment advisers, including activities that require registration and exclusions from registration. It focuses on understanding the roles and responsibilities of investment advisers and how they are regulated.
- Topic 2: Regulations of Investment Adviser Representatives: This section of the exam measures the skills of investment adviser representatives and covers the definition of an investment adviser representative, activities requiring registration, and exclusions from registration. It emphasizes the importance of registration for individuals providing advisory services.
- Topic 3: Regulations of Broker-Dealers: This section of the exam measures the skills of broker-dealer managers and covers the definition of a broker-dealer, registration, and post-registration requirements, and activities that require registration. It also includes the supervision of broker-dealer agents, highlighting the regulatory framework for broker-dealers.
- Topic 4: Regulations of Agents of Broker-Dealers: This section of the exam measures the skills of the target audience and covers the definition of an agent of a broker-dealer, registration and post-registration requirements, and activities that require registration. It includes updating uniform forms and understanding exclusions from registration.
- Topic 5: Regulations of Securities and Issuers: This section of the exam measures the skills of Investment analysts and covers the definition of securities and issuers, state registration and post-registration requirements, exemptions from registration, and state enforcement and antifraud authority. It focuses on understanding how securities are regulated at the state level.
- Topic 6: Remedies and Administrative Provisions: This section of the exam measures the skills of regulatory specialists and covers administrative actions, other penalties, and liabilities related to securities violations. It emphasizes the legal and administrative processes involved in enforcing securities regulations.
- Topic 7: Communication with Customers and Prospects: This section of the exam measures the skills of the target professionals in product disclosures, unlawful representations concerning broker-dealer agent registration, performance guarantee prohibition, customer agreements, and correspondence and advertising regulations. It includes social media, email/digital messaging, and website communications.
- Topic 8: Ethical Practices and Obligations: This section of the exam measures the skills of Compliance Officers and covers compensation structures such as fees and commissions, customer funds and securities management, conflicts of interest, and other ethics issues like excessive trading and insider trading. It emphasizes the importance of maintaining ethical standards in the securities industry.
Free Finra Series-63 Exam Actual Questions
Note: Premium Questions for Series-63 were last updated On Apr. 20, 2025 (see below)
Joe Treader is the owner of a small, state-registered investment advisory firm that is on the verge of becoming insolvent. One of his clients who has become like a mother to him is aware of his financial difficulties and has offered to sell off some of the assets that he manages for her and loan him the money to get him through this period of economic uncertainty until he is able to get on his feet again.
Can Joe take her up on her offer?
No, Joe cannot take his client's offer of a loan because it could lead to a conflict of interest--if not today, perhaps in the future--and as a fiduciary Joe will be expected to put this client's welfare ahead of his own. If it takes him a lot longer than expected to get on his feet again, he may be tempted to act in his own best interest.
Which of the following entities is subject to be accused of churning?
I . investment advisers
II . investment adviser representatives
III . broker-dealers
IV . agents
Selections I, II, III, and IV-investment advisers, their representatives, and broker-dealers and their agents-are subject to accusations of churning. Any activity on the part of any of these parties that suggests that they are engaged in encouraging excessive trading on the accounts of their clients makes them subject to allegations of churning their customers' accounts.
Stable Corporation registered a bond issue that it plans to offer for sale in the state with the Administrator.
The bond has a par value of $1,000 and will pay interest of 7% a year, with the principal to be repaid in 5 years. The registration became effective on September 8th. The registration is effective
The bond's registration is effective for one full year from the effective date of the registration.
Which of the following statements regarding an open-end investment company is not true?
The shares of an open-end investment company are not bought and sold on exchange floors. An open-end investment company is a mutual fund, and its shares are bought and sold through the company. The price per share will be either at net asset value as is the case with a no load fund, or above net asset value, as is the situation with a load fund, when the price is equal to net asset value + the sales charge (load.) Open-end investment company shares are federal covered and, as such, do not need to be registered with the state.
As an agent, which of the following statements about the Securities Investor Protection Corporation (SIPC) can you legitimately make to your client?
The statement that you can legitimately make about the SIPC to your client is that it was established to restore funds to investors when the brokerage firm they have been using is bankrupt or in financial distress. The SIPC does not insure investors against losses in the stock and bond markets like the FDIC does bank deposits, and it does not combat fraud.
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