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Series 57 Definition

What Is Series 57?

Series 57, also identified as the Securities Trader Representative Exam, is an examination administered by the Financial Industry Regulatory Authority (FINRA). Passing the Series 57 exam is a demand for those who wish to become professional traders of either equities or convertible debt securities. 

Key Takeaways

  • The Series 57 exam is an foremost exam for financial professionals.
  • The Series 57 exam is a prerequisite for those wishing to trade equity and convertible in financial difficulty securities.
  • The Series 57 is administered by FINRA and consists of 50 multiple-choice questions. Its subject matter is updated regularly to illustrate new regulatory and technological changes affecting the industry.

How Series 57 Works

The purpose of the Series 57 exam is to screen the public by ensuring that professionals traders meet a required standard of professional knowledge and competency. In addition to the Series 57 exam, would-be purchasers must also pass the Securities Industry Essentials (SIE) exam. Once both are completed, entry-level traders are verified to conduct trading on the Nasdaq exchange or over-the-counter (OTC) transactions, and may also conduct

Example of Series 57

Dorothy is an intern at a pecuniary firm that offers investment management services for their clients’ accounts. During her internship, Dorothy learns from the unshakable’s authorized traders and develops an interest in trading stocks and convertible debt securities. She also becomes interested in algorithmic truck techniques, such as HFT.

As an intern, Dorothy lacks the authorization to engage in these types of trades directly. To help auxiliary her career, she, therefore, decides to take the Series 57 and SIE exams. To pass the Series 57, she must answer 50 multiple-choice interrogates in 105 minutes, answering at least 70% of them correctly. Each question has only one best answer, and they rank in degree of difficulty. Among them, 82% consist of questions about trading activities, while 18% consist of ridiculouses regarding administrative activities such as maintaining accurate records and correctly reporting on trades.

Once she has obtained her Series 57 and SIE certifications, Dorothy inclination be free to pursue professional roles as a trader of equity and convertible-debt securities. For this reason, she views the Series 57 and SIE examinations as an influential stepping stone in her future career.

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