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Finra SIE Exam Questions
- Topic 1: Regulatory Entities, Agencies, and Market Participants: This section of the exam measures the skills of Financial Regulatory Analysts and covers the structure, authority, and jurisdiction of key regulatory bodies overseeing financial markets. The SEC's role in enforcing securities regulations is assessed, along with the authority of self-regulatory organizations such as FINRA and MSRB. Candidates must also understand the functions of other financial regulators, including the Department of the Treasury and state regulatory agencies. One key skill evaluated is identifying the jurisdictional scope of different financial regulators.
- Topic 2: Market Structure: This section of the exam measures the skills of Equity Market Specialists and covers the classification of financial markets, including the primary, secondary, third, and fourth markets. Candidates must demonstrate knowledge of electronic trading, over-the-counter (OTC) markets, and physical exchanges. One specific skill tested is differentiating between various market types and their operational mechanisms.
- Topic 3: Understanding Products and Their Risks: This section of the exam measures the skills of Investment Analysts and examines different financial products and associated risks. Candidates must understand equity securities, including common stock, as well as debt instruments such as Treasury securities and mortgage-backed securities.
- Topic 4: Understanding Trading, Customer Accounts, and Prohibited Activities: This section of the exam measures the skills of Securities Traders and focuses on different trading strategies, settlement processes, and corporate actions. Candidates must demonstrate knowledge of order types, including market, limit, stop, and good-til-canceled orders, as well as bid-ask spreads and discretionary versus non-discretionary trading.
- Topic 5: Overview of the Regulatory Framework: This section of the exam measures the skills of Compliance Officers and evaluates knowledge of self-regulatory organization (SRO) requirements, including registration and continuing education for associated persons. Candidates must understand the distinction between registered and non-registered individuals and the requirements for maintaining industry qualifications.
- Topic 6: Employee Conduct and Reportable Events: This section of the exam measures the skills of Financial Compliance Specialists and covers regulatory expectations regarding employee conduct and disclosure requirements. Candidates must be familiar with Form U4 and Form U5, as well as reporting obligations for outside business activities and political contributions.
Free Finra SIE Exam Actual Questions
Note: Premium Questions for SIE were last updated On Aug. 21, 2026 (see below)
Which of the following customers Is eligible to open an institutional account at a broker-dealer?
A customer wants to open an account to trade covered calls and puts. Which of the following communications must be provided to the customer prior to approving the account for trading?
FINRA Rule 2360 requires that customers receive the Options Disclosure Document (ODD), published by the Options Clearing Corporation (OCC), before they are approved to trade options. The ODD explains the risks and characteristics of options trading.
D is correct because the ODD is mandatory for options account approval.
A is incorrect because a prospectus is not specific to options trading.
B is incorrect because the MSRB Investor Brochure applies to municipal securities.
C is incorrect because a margin disclosure statement is required only for margin accounts.
Which of the following statements is true about a general obligation (GO) municipal bond?
A general obligation (GO) municipal bond is backed by the full faith and credit of the issuing municipality or governmental unit, which is why choice C is correct. In practical terms, this means the issuer pledges its general taxing power and overall resources to meet debt service---interest and principal payments. GO bonds are typically supported by the issuer's ability to levy taxes (often property taxes, subject to legal limits), making their repayment source broader than that of revenue bonds.
Choice D describes a revenue bond, which is payable only from a specific revenue stream (e.g., tolls from a bridge, fees from a water/sewer system, or revenues from an airport). Revenue bonds do not rely on the issuer's general taxing power; instead, bondholders depend on the project's or enterprise's revenues. That is a key GO vs. revenue distinction tested heavily on the SIE.
Choice A is incorrect because municipal securities customarily include a legal opinion addressing validity and tax status, especially for tax-exempt issues; the presence of a legal opinion is not something GO bonds uniquely lack. Choice B is incorrect because many municipal bonds, including many GO bonds, are federally tax-exempt on interest (and may also be state/local tax-exempt for in-state residents), though there are exceptions such as taxable munis and AMT considerations in certain cases. The question's best, universally correct feature of a GO bond is the backing by the issuing jurisdiction's full faith and credit.
This question aligns with SIE product knowledge of municipal securities, including repayment sources and how those sources affect credit considerations.
Activities]
A registered representative (RR) opens a new account for a customer whose investment objectives are growth and income. She makes an initial deposit of $5,500 using a series of money orders drawn from different sources, and she makes no investments for the first 30 days the account is open. At the end of that time, the customer asks to have the funds wired to an account at a different firm as her needs have changed. The RR's first course of action should be to:
Step by Step
Suspicious Activity: The use of multiple money orders, lack of investment activity, and request to wire funds to another firm raise red flags for potential money laundering.
FINRA Rules: The RR should escalate the issue by reporting internally and potentially filing a Suspicious Activity Report (SAR).
Incorrect Options:
A: Denying the request without investigation may violate customer instructions.
B: Freezing the account requires a valid legal or regulatory basis.
D: Processing the request without investigation could facilitate illegal activity.
FINRA Anti-Money Laundering (AML) Guidance: FINRA AML Rules.
A registered representative (RR) intends to enter into an arrangement for compensation with an unaffiliated entity to participate in the sale of promissory notes to the general public. Which of the following statements is true?
Step by Step
Private Securities Transactions: Under FINRA Rule 3280, RRs must obtain written approval from their employing firm before participating in the sale of securities outside the firm.
Promissory Notes: These are typically considered securities, requiring prior approval.
Incorrect Options:
A & C: Notification alone is insufficient; written approval is required.
D: Promissory notes are generally treated as securities under federal law.
FINRA Rule 3280 (Private Securities Transactions): FINRA Rule 3280.
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