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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 Jul. 19, 2025 (see below)
Which of the following does not necessarily have to be included in the contract between an investment adviser and an individual client, according to the Uniform Securities Act (USA)?
A statement of the investment policy does not have to be included in the contract between an investment adviser and an individual client. The statement of investment policy is generally developed after the contract is signed.
Rich Quick is a broker-dealer registered in the state of Massachusetts. He occasionally trades on abnormalities he observes in bond yield spreads for his own account, short selling a bond that appears to be overpriced based on its yield and buying a bond that is identical in almost every respect except for the price, which is less than that of the other bond. He has been able to earn arbitrage profits 95% of the time when he does this. Rich Quick
If Rich Quick is able to earn profits 95% of the time by trading on abnormalities he observes in bond yield spreads, he is skilled. There is nothing illegal in what he is doing. Arbitrageurs attempt to earn profits when they observe what they believe to be mispriced securities, and this is an accepted activity. Rich is not using insider information; bond yields are publicly available information.
Mr. Noah Scruples is a registered representative with CanDo Broker-Dealers. A client calls and wants Noah to purchase shares of a mutual fund the client has read about. CanDo is not authorized by this particular fund to effect purchases or sales of the fund shares.
Can Noah execute the order anyway?
No. If CanDo is not authorized to effect purchases and sales of the fund, Noah would be engaged in the prohibited practice known as selling away if he were to execute the order. If his broker-dealer is not authorized to trade a security, Noah can't either.
: 65
Which of the following would meet the requirements for an ''exempt security?''
An issue of commercial paper with a $100,000 denomination and a maturity of five months with an AA rating from Standard and Poors meets the requirements for an ''exempt security.'' A short-term security, with no more than 270 days to maturity, that has a denomination of at least $50,000, and has a rating of AAA, AA, or A from a recognized rating agency is exempt from registration with the state Administrator.
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.
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