Series 7

Key Topics to Master:

• Customer investment profile factors: risk tolerance, time horizon, objectives and liquidity needs, and their application to security selection
• Equity securities: authorised, issued, outstanding and Treasury stock; common stockholder rights including pre-emptive rights and cumulative versus statutory voting; preferred stock types including cumulative, participating, convertible, callable and adjustable-rate
• Debt securities, municipal securities and their tax treatment, plus government securities, CMOs and certificates of deposit
• Options strategies, exercise and assignment, and the options disclosure document
• Packaged products: mutual funds, unit investment trusts, ETFs, REITs, variable annuities and variable life
• Direct participation programmes, hedge funds and other alternative products
• Fundamental analysis: balance sheet and income statement terms, LIFO and FIFO, EBIT, EBT, EBITDA, and ratios for liquidity, bankruptcy risk, asset use and profitability
• Portfolio theory including alpha, beta and the Capital Asset Pricing Model, plus diversification, asset allocation and concentration
• Delivery of annual reports and notices of corporate actions such as dividends, splits and odd lot tenders

Key Topics to Master:

• Margin account requirements, approvals, eligible and ineligible securities, and required disclosures including the hypothecation and interest rate disclosures
• Initial margin calculations: long and short market value, debit and credit balances, the Regulation T requirement, loan value, excess equity and buying power
• Maintenance calculations: additional purchases, sales, cash and stock withdrawals, restrictions, and liquidation to meet a maintenance call
• The special memorandum account: balance, buying power, prohibited uses and the effect of excess equity
• Portfolio margin and day trading accounts
• Quotes, order types and trade confirmation requirements
• Discrepancies, disputes and errors, and when to involve a supervisor

Key Topics to Master:

• Account types and the disclosures each requires
• Customer identification and required legal documentation
• Reasonable efforts to obtain the customer investment profile
• Which account openings need principal approval and when
• Recordkeeping and updating obligations after an account is open
• Options account approval requirements and the options agreement

Key Topics to Master:

• Communications with the public under FINRA Rules 2210 to 2216 and 2220, including retail, institutional and correspondence categories and their approval standards
• Product-specific advertising rules for investment company products, variable contracts, municipal securities, CMOs, CDs and research reports
• Bringing new issues to market: due diligence, registration statement, preliminary prospectus, final prospectus, underwriting agreement, selling group agreement and blue-sky procedures
• Municipal primary financing: competitive sale, negotiated sale, private offering and advance refunding, plus official statements and notices of sale
• Syndicate formation, the underwriters' spread, concession and reallowance
• Regulation A and Regulation D offerings, qualified institutional buyers and accredited investors
• Restrictions on communications during the pre-filing, cooling-off and post-registration periods

• 1Confirm your firm has filed the Form U4 and requested your Series 7 enrolment through CRD. Without a sponsoring FINRA member firm you cannot enrol at all.
• 2Download the Series 7 Content Outline free from finra.org and read the Structure of the Exam section. Note the item counts: 9, 11, 91 and 14.
• 3If you have not already passed the SIE, book it first. It is 100 dollars, 75 questions, 1 hour 45 minutes, passing score 70, and it can be taken online without an accommodation.
• 4Note your 120-day enrolment window start date and work backwards from it. FINRA does not extend windows for ordinary reasons and does not operate a hardship policy.
• 5Choose one primary provider course such as Kaplan Financial Education, Securities Training Corporation or the Securities Institute of America, and stop shopping.

• 1Learn the stock categories cold: authorised, issued, outstanding and Treasury stock, and how each affects earnings per share.
• 2Work through common stockholder rights, including pre-emptive rights and the difference between statutory and cumulative voting, then do 40 questions on them.
• 3Learn the six preferred stock types the content outline names: cumulative, non-cumulative, participating, nonparticipating, convertible and callable, plus adjustable and variable rate.
• 4Study the new-issue process end to end: due diligence, registration statement, red herring, final prospectus, underwriting agreement, selling group agreement and blue-sky procedures.
• 5Learn the underwriters' spread, the concession and the reallowance, and be able to say who keeps what.

• 1Build a single sheet covering nominal yield, current yield, yield to maturity and yield to call, and their order for a bond trading at a discount and at a premium.
• 2Learn government securities, agency issues, CMO tranches and certificates of accrual, all named in the content outline.
• 3Practise accrued interest calculations for corporate, municipal and government bonds with the day-count conventions each uses.
• 4Do 60 mixed debt questions using only a four-function calculator, since that is the only calculator FINRA provides.
• 5Learn the ratings scales and what constitutes investment grade.

• 1Learn general obligation bonds against revenue bonds: sources of repayment, the debt service coverage ratio and the additional bonds test.
• 2Study MSRB Rule G-21 on advertising and the disclosure obligations in the official statement and preliminary official statement.
• 3Work the tax equivalent yield formula until it is automatic, plus the triple tax exemption rule and its residency condition.
• 4Learn municipal fund securities, including 529 plans and local government investment pools.
• 5Note the registration boundary: a Series 7 obtained on or after 7 November 2011 qualifies you only for municipal sales to and purchases from customers, and structuring underwritings requires the Series 52.

• 1Learn the four basic positions and their maximum gain, maximum loss and breakeven: long call, short call, long put, short put.
• 2Draw the profit and loss diagram for each from memory, without notes, ten times.
• 3Learn covered calls, protective puts and married puts, and the tax treatment of each.
• 4Practise 50 single-option calculation questions with a four-function calculator only.
• 5Study the options disclosure document delivery requirement and the options account approval process.

• 1Learn spreads and straddles: debit and credit spreads, long and short straddles, and the maximum gain, maximum loss and breakeven for each.
• 2Move to margin: initial Regulation T requirement, long and short market value, debit and credit balance, loan value, excess equity and buying power.
• 3Learn the special memorandum account: how it is created, what creates buying power, and the prohibited uses.
• 4Practise maintenance call calculations for both long and short accounts until you can do them without hesitating.
• 5Do 60 combined options and margin questions under time pressure, at 1 minute 44 seconds each.

• 1Learn mutual fund share classes, breakpoints, letters of intent, rights of accumulation and the sales charge calculation.
• 2Study unit investment trusts, ETFs and REITs and what distinguishes each from an open-end fund.
• 3Learn variable annuities and variable life: accumulation and annuity units, the assumed interest rate, and the surrender and 1035 exchange rules.
• 4Study direct participation programmes: limited partnership structure, passive income and loss, recourse and non-recourse debt.
• 5Cover retirement plans, including the tax treatment of contributions and distributions for each account type.

• 1Reread Function 3 task 3.2 in the content outline and list every product family it names.
• 2Learn the customer investment profile elements and be able to match a profile to a product in one step.
• 3Study Regulation Best Interest and the care, disclosure, conflict of interest and compliance obligations.
• 4Work 80 suitability questions and record which distractor type fooled you each time.
• 5Study prohibited practices: churning, front running, breakpoint sales and unsuitable recommendations.

• 1Learn the balance sheet and income statement terms the outline names, including EBIT, EBT, EBITDA, book value and fully diluted EPS.
• 2Learn the ratio families the outline groups: liquidity, bankruptcy risk, efficient use of assets and profitability.
• 3Study alpha, beta and the Capital Asset Pricing Model, plus diversification and asset allocation.
• 4Learn order types, quotes, ECNs and over-the-counter mechanics from Function 4 task 4.1.
• 5Cover corporate actions: dividends, splits, odd lot tenders and their effect on option contracts.

• 1Study Function 2 in full. It is 11 items, which is the same as clearing five margin questions, and it is far easier to secure.
• 2Learn customer identification requirements, required documentation, and which accounts need principal approval.
• 3Study Function 1 communications rules: FINRA Rules 2210 to 2216 and 2220, the retail, institutional and correspondence categories, and their approval standards.
• 4Learn Regulation A and Regulation D, accredited investor and qualified institutional buyer definitions.
• 5Do a 30-question drill covering Functions 1 and 2 only, and target 90 percent.

• 1Sit two full 130-item practice exams in 3 hours 45 minutes each, on separate days, with a four-function calculator and paper only.
• 2Log every wrong answer against its function number and rebuild your revision list from the counts.
• 3Reread the content outline sections matching your three weakest topic areas.
• 4Practise the pacing checkpoints: 26 items by minute 45, 65 by minute 113, 104 by minute 180.
• 5Schedule your Prometric appointment if you have not already, and confirm the test centre address and your ID.

• 1Sit one more full-length exam at the same time of day as your appointment.
• 2Rewrite the options profit and loss diagrams and the margin formulas from blank paper, twice.
• 3Reread the FINRA Qualification Examinations Rules of Conduct, including the prohibition on any assistance from generative artificial intelligence or large language models.
• 4Check your government-issued photo ID is unexpired and that the name on it exactly matches the name your exam is scheduled under. Expired IDs are not accepted and photocopies are not accepted.
• 5Plan to arrive 30 minutes before the appointment. Arriving more than 30 minutes late means you will not test if no seat is free, and you will pay for a new enrolment.