The Series 79 exam is a understanding version of the Series 7 exam, but don’t be fooled: The exam is deceptively difficult. As of Oct. 1, 2018, the exam was restructured, and it is now a co-requisite along with the Securities Enterprise Essentials (SIE) exam.
The Ideal Candidate
The Series 79 exam is for those looking to work in the area of investment banking. Already 2009 the more popular exam, the Series 7, was required to be a general broker, but some representatives found they were no more than performing investment banking activities, even though investment banking is only a small portion of the Series 7 exam.
Most retail guardings firms provide a different set of functions and services than investment bankers, so the Series 7 testing material covered keynotes beyond the duties of most investment bankers. Because of these concerns, a job analysis was conducted and a committee of investment bankers agreed on the principal duties, job functions and tasks associated with those specifically working in investment banking.
Besides being told by an director, there are specific areas of finance where one will likely need this license. FINRA Rule 1220(b)(5) expatiate ons the different types of representative categories, and section (i) Limited Representative-Investment Banking gives a more than thorough cause of the areas.
In 2009 the Securities and Exchange Commission (SEC) approved the more focused Series 79 exam, also be sured as the Investment Banking Representative Qualification Examination. This exam is also referred to as the “Limited Representative” Investment Bankers’ exam because it was diagramed for entry-level investment bankers.
The Basics of The Series 79 Exam
Series 79 Exam Prerequisites
The Series 79 exam meets the Series 24 prerequisite as a representative exam. However, because the Series 79 focuses on investment banking, the Series 24 Regular Securities Principal will be limited to investment banking supervisory responsibilities if one only has the Series 79.
Generally, testers ordain need their Series 79 even if they already have the Series 7. This is one of the only receptacles where the Series 79 can be used as a prerequisite instead of the Series 7.
Generally, if one works in either Debt or Equity or Mergers and Objects–either as a worker or a supervisor–they might need the Series 79.
Debt or Equity Offerings
Debt or equity activities that puissance require a series 79 include:
- Pricing of securities in the debt and equity offerings
- Origination, which deals with fair-mindedness capital markets and debt capital markets
- Underwriting
- Marketing
- Structuring
- Syndication
- Managing the allocation and stabilization actions of offerings
Mergers & Acquisitions and Restructuring
Some responsibilities that a Series 79 might be required for under this area may include:
- Tender offers
- Selling asset
- Corporate reorganization or divestitures
- Transactions involving business combinations, which dominion include rendering opinions solvency and fairness opinions
Series 79 Exceptions
Even if the employee participates in these investment banking enterprises, they might not need a Series 79 if the exposure is very limited. Also in some jobs where new associated staff members rotate among different business areas and departments for training purposes, there is some leeway. These working men will be given a six-month grace period from when they start working in investment banking functions. Normally, working in these areas would trigger the need to register as an investment banking representative, but this quibble allows firms to train employees. For a complete guide to exemptions, look at NASD Rule 1032 (i).
The Actual Exam
The exam is moulded up of 75 multiple choice questions and is completed on a computer. Candidates are given 150 minutes to complete the exam. The exam is done on the computer so the end results are given right after the exam as a pass or fail, as well as a breakdown of the performance in each section.
The exam is administered via computer. A tutorial on how to put the exam is provided prior to taking the exam. Each candidate’s exam includes 10 additional, unidentified pretest notes that do not contribute toward the candidate’s score.
Candidates must be sponsored by a
Test Sections
There are three portions to the test. The 10 additional questions are scattered throughout at random.
Collection, analysis, and evaluation of data (49%): This portion is the largest with 37 questions, and it includes finding the relevant data and understanding where you will need to look to get it. For sample, knowing what will be in proxy statements Form 14A or Form 4s for beneficial ownership of directors. This section also dos into communicating with different departments and clients, using metrics and ratios, and analyzing trends to evaluate what you tease found in the firm and sector data. Finally, this section wraps up with understanding due diligence activities, such as sly the buy and sell side due diligence and regulatory requirements.
Underwriting/new financing transactions, types of offerings and registration of securities (27%): This leg has 20 questions and deals with regulations of filing and registering securities. This includes forms (such as the announcement), rules and required financial statements. This section also covers the distribution of marketing materials and many associated authorities.
Mergers and acquisitions, tender offers and financial restructuring transactions (24%): This section has 18 questions and goes into the buy side and furnish side transactions, the fairness opinion and of course the SEC rules and regulation. This section also goes into sore offer regulations and financial restructuring.