Series 66 Information

Please note, the Series 7 is a co-requisite exam that needs to be successfully completed in addition to the Series 66 exam before a candidate can apply to register with a state. You may take either exam first but must complete both satisfactorily.

The Series 66 exam is designed to qualify candidates as investment adviser representatives. It is comprised of 100 questions and is administered within a 2 1/2 hour time limit. Your results are available immediately at the conclusion of the exam.

The examination is administered by FINRA. To schedule the examination, you should file a Form U-10 and pay the $110 examination fee directly to FINRA. FINRA will then send you a letter explaining the window of time they have allowed for you to sit for the exam along with instructions for setting an examination appointment. There is no need to return the Form U-10 to MarketCounsel.

To assist you with preparing for the exam, we offer comprehensive study materials. Although successful completion of the examination may satisfy a portion of the requirements of a particular state, it does not convey the right to transact business prior to being granted a license or registration by that state.

The following study outline is designed to provide an overview of the exam’s general content and format. The Series 66 exam and the study outline were both developed by the North American Securities Administrators Association, Inc. (“NASAA”).

Uniform Combined State Law Examination
(Series 66)
Exam Specifications
CONTENT AREA #OF ITEMS
1. Investment Analysis, Recommendations, and Strategies (20)
1. Demonstrate understanding of quantitative methods to evaluate investments

  1. Time value of money
  2. Expected return
  3. Net present value
  4. Internal rate of return
  5. Inflation-adjusted return (real return)
  6. Risk-adjusted return
  7. Total return
  8. Holding period return
  9. Annualized return
2. Calculate investment performance

  1. Total return (i.e., yield plus growth)
  2. Inflation-adjusted return
3. Determine and analyze the financial profile of the client to develop a suitable investment policy and strategy

  1. Type of client
    1. Individual
    2. Sole proprietorship
    3. General partnership
    4. Limited partnership (including family limited partnership)
    5. Limited liability company
    6. C corporation
    7. S corporation
    8. Trust
    9. Estate
  2. Financial goals
  3. Current financial status (e.g., cash flow, balance sheet)
  4. Capital needs (e.g., current, retirement, death, disability)
  5. Current investments and strategies
  6. Time horizon
  7. Non-financial investment

    8. considerations (e.g., values, attitudes, experience, demographic characteristics)

  8. Risk tolerance
  9. Tax situation
4. Recognize types of retirement plans and related issues

  1. Retirement plans
    1. Individual Retirement Arrangements (IRA)
    2. 403(b) plans
    3. Qualified retirement plans (e.g., pension and profit sharing, 401(k))
    4. Nonqualified retirement plans
  2. Important ERISA issues
    1. Fiduciary responsibility (e.g., 404(c))
    2. Investment policy statement
    3. Prohibited transactions
5.Identify risks (i.e. definitions, impact on the market, companies, and personal investments)

  1. Business
  2. Market
  3. Interest rate
  4. Inflation
  5. Regulatory (e.g., tax law changes)
  6. Liquidity
  7. Opportunity cost
6.Understand portfolio management strategies, styles, and techniques (fixed income and equities)

  1. Portfolio management styles and strategies
    1. Strategic and tactical asset allocation (e.g., style, asset class, rebalancing)
    2. Active vs. passive
    3. Growth vs. value
    4. Market capitalization (micro, small, mid, large)
    5. Buy/hold
    6. Indexing
    7. Diversification
  2. Funding techniques
    1. Dollar-cost averaging
    2. Income reinvestment (e.g., dividend, interest, cap gain)
Ethics and Legal Guidelines (80)
1.Understand relevant aspects of state securities laws (i.e., Blue Sky)

  1. Uniform Securities Act
    1. Fraudulent and other prohibited practices
    2. Registration of investment advisers, investment adviser representatives, broker-dealers, and agents
    3. Registration of securities
    4. General provisions
  2. NASAA rules prohibiting dishonest and unethical business practices
 50
2. Understand relevant aspects of federal securities laws and other rules and regulations in order to comply as an investment adviser representative

  1. Investment Company Act of 1940
  2. Investment Advisers Act of 1940
  3. Securities Act of 1933 and Securities Exchange Act of 1934 (as applicable to investment adviser issues)
  4. SEC Release No. IA-1092 (applicability of the Investment Advisers Act to financial planners and others)
 10
3. Demonstrate ability to apply ethical practices

  1. Fiduciary responsibility
  2. Conflict of interest
  3. Prudent Investor standards
  4. Limitations on advice and activities (i.e., when to consult other professionals)
 20