Series 57

Series 57

Series 57, the Securities Trader Representative Exam, is administered by the Financial Industry Regulatory Authority (FINRA). It qualifies individuals to trade equity and convertible-debt securities on exchanges (such as Nasdaq), over-the-counter (OTC) markets, and for proprietary trading desks. The exam exists to ensure traders meet professional standards of knowledge and ethical conduct.

Key takeaways

• Administered by FINRA; required to become a registered securities trader for equities and convertible debt.
• Candidates must pass the Securities Industry Essentials (SIE) exam and be sponsored by a FINRA member firm or other self‑regulatory organization (SRO).
• The Series 57 exam is 50 multiple-choice questions, 105 minutes, and requires a 70% score to pass.
• Exam content is updated periodically to reflect regulatory and technological changes (e.g., high-frequency trading).

How the Series 57 works

The Series 57 tests practical and regulatory knowledge needed for professional trading. FINRA develops questions based on interviews with practitioners and firms, and updates the content to reflect current market practices and risks. The goal is to protect investors and maintain market integrity by ensuring traders are competent and act ethically.

Requirements
* Sponsorship: Candidates must be affiliated with and sponsored by a FINRA member firm or another SRO.
* SIE: Passing the Securities Industry Essentials (SIE) exam is also required for registration.

Exam format and content
* 50 multiple-choice questions.
105 minutes to complete.
Passing score: at least 70% correct.
* Content mix: approximately 82% trading-related topics and 18% administrative topics (e.g., recordkeeping and trade reporting).

Recent changes

Significant updates have been made over time to address evolving market practices. For example, in January 2017 FINRA added material on algorithmic and high-frequency trading (HFT) after regulatory and news attention on problematic HFT behaviors. Candidates who pass future versions are tested on the new content; prior passers are not retroactively retested.

Example scenario

An intern interested in becoming a professional trader studies for and passes both the SIE and Series 57. Once certified and sponsored by a member firm, the intern can take on registered trader responsibilities—executing trades in equities and convertible debt and working with the firm’s trading systems and compliance requirements.

Preparing for the exam

Prospective candidates should:
* Confirm sponsorship with a FINRA member firm or SRO.
Complete and pass the SIE exam.
Study current trading practices, market regulations, trade reporting, and firm compliance procedures—paying special attention to algorithmic trading and recent regulatory developments.