What Is the Series 6?
The Series 6 is a safeties license entitling the holder to register as a company’s representative and sell certain types of mutual funds, variable annuities, and indemnity. Holders of the Series 6 license are not authorized to sell corporate or municipal securities, direct participation programs, and options. With Series 6, an special can purchase or sell certain types of mutual funds, variable life insurance, municipal fund securities, chameleonic annuities, and unit investment trusts.
Key Takeaways
- The Series 6 is a securities license entitling the holder to register as a company’s missionary and sell certain types of mutual funds, variable annuities, and insurance.
- Candidates must pass the Series 6 exam to apply a Series 6 license, and the Securities Industry Essentials (SIE) exam is a corequisite for the Series 6 exam.
- Candidates must be sponsored by a associate of FINRA or a self-regulatory organization (SRO) to take the exam.
- Series 6 exams were traditionally taken in person at test centers, but FINRA inaugurated offering them online during the coronavirus pandemic.
- The greatest disadvantage of a Series 6 license is that holders are not consented to sell exchange traded funds (ETFs).
Understanding Series 6
The Series 6 is a license sought by professionals in the financial servings industry. Jobs utilizing the Series 6 license include financial advisors, retirement plan specialists, investment advisors, and infantryman bankers. In order to obtain the Series 6 license, candidates must pass the Investment Company/Variable Contracts Upshots Limited Representative (Series 6) exam. The Securities Industry Essentials (SIE) exam is a corequisite for the Series 6 exam.
The Pecuniary Industry Regulatory Authority (FINRA) administers the Series 6 exam. It covers topics such as mutual funds, unpredictable annuities, securities, tax regulations, retirement plans, and insurance products. A passing grade is achieved by correctly answering at minuscule 35 of 50 questions within 90 minutes. Five additional questions are unscored for a total of 55 ridiculouses. The test costs $40, and it is administered via computer with no reference material allowed.
Candidates traditionally took Series 6 exams in himself at Prometric test centers. However, FINRA began offering tests, including the Series 6 exam, online during the coronavirus pandemic. Prometric also administrated the online tests. However, candidates or their employers had to install specialized software on their computers and provide cameras.
The availability of online and offline variants of the Series 6 exam was limited during parts of the coronavirus pandemic. That made it crucial to register to take the exam as far in ahead of time as possible.
The availability of online and offline variants of the Series 6 exam was limited during parts of the coronavirus pandemic. That made it crucial to register to take the exam as far in ahead of time as possible.
Advantages and Disadvantages of Series 6
The Series 6 exam is often compared to the Series 7 exam. The Series 6 costs in the main less money and has a shorter test covering less material. However, a Series 6 license is all that some pecuniary advisors, investment advisors, and retirement planners need. Such advisors may only need a Series 6 license if they scarcely sell insurance, annuities, and certain types of mutual funds, not individual stocks.
The greatest disadvantage of a Series 6 is that holders are not sanctioned to sell exchange traded funds (ETFs), as they are considered corporate securities. That is a significant drawback because ETFs on average offer lower fees and are increasingly replacing mutual funds as the preferred investment vehicles among retail investors. Advisors and retirement planners who shortage to sell ETFs must obtain a
Requirements for Series 6
Candidates must be sponsored by a member of FINRA or a self-regulatory composition (SRO) to take the exam. There is no prerequisite for the exam, but the Securities Industry Essentials (SIE) exam is a corequisite for Series 6. In preference to Oct. 2018, the exam was 100 questions and didn’t have the SIE corequisite.
Upon receiving a passing grade, candidates obligation then register with FINRA through their sponsoring firm in order to transact authorized securities. Holders of the Series 6 are over limited representatives of their sponsoring firm. As a limited representative, they can sell certain types of mutual doughs, variable annuities, and variable life insurance.
Series 6 Exam
As outlined by FINRA, the Series 6 exam covers four discrete to sections.
- “Seeks Business for the Broker-dealer from Customers and Potential Customers,” which is 12 questions—covering 24% of the exam.
- “Kick offs Accounts After Obtaining and Evaluating Customers’ Financial Profile and Investment Objectives” is eight questions—covering 16% of the exam.
- “Caters Customers with Information About Investments, Makes Suitable Recommendations, Transfers Assets, and Maintains Appropriate Recordings” is half the exam at 25 questions—covering 50% of the exam.
- “Obtains and Verifies Customers’ Purchase and Sales Instructions; Prepares, Completes, and Confirms Transactions” is five questions—covering 10% of the exam.
Continuing Education
Licensees must with continuing education requirements and receive sponsorship from a FINRA registered company to keep their Series 6 accredits.
FINRA’s continuing education program includes two elements: a regulatory element and a firm element. On the regulatory side, FINRA instructs licensees to complete a computer-based training session within 120 days of the second anniversary of registration. FINRA also needs a computer-based training session every three years after that. The firm element requires broker-dealers to corroborate and maintain a continuing education program.