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What Is the Series 24?
Let me tell you straight up: the Series 24 is an exam and license that lets you supervise and manage branch activities at a broker-dealer. It's officially called the General Securities Principal Qualification Examination, and it's built to check if you're knowledgeable and competent enough to step into an entry-level securities principal role. Once you pass, you can handle supervisory tasks like ensuring regulatory compliance in trading and market-making, underwriting, and advertising.
Key Takeaways
You take the Series 24 exam to qualify for managing branch activities. FINRA lays out the prerequisites, which involve passing multiple investment exams such as the Series 7 and Series 79. The exam itself has 150 scored questions, with the section on supervising general broker-dealer activities having the most questions. And yes, it's an extremely difficult exam.
How the Series 24 Works
FINRA administers the Series 24 exam, and it covers topics like corporate securities, real estate investment trusts (REITs), trading, customer accounts, and regulatory guidelines. To get principal registration, you must pass the Series 24, the Securities Industry Essentials (SIE) exam, and one of these five representative-level exams: Series 7, 57, 79, 82, or 86/87. Alternatively, you can pass the Series 24 and Series 16 without the SIE to qualify for research principal registration.
The Series 24 Exam
The exam includes 150 scored questions plus 10 unscored ones scattered randomly. You need to get at least 105 of the scored ones right for a 70% score to pass. They'll give you electronic calculators, dry-erase boards, and markers, but forget bringing your own calculators, references, or study materials into the room. You have up to three hours and 45 minutes to finish it. A FINRA member firm or similar can register you by filing Form U4 and paying the $120 fee.
Special Considerations
The Series 24 content breaks down into five main job functions for a general securities principal at a broker-dealer. First, there's supervision of registration and personnel management, with 9 questions on regulatory requirements, exemptions, hiring, and maintaining registrations. Then, supervision of general broker-dealer activities takes 45 questions, covering policies, procedures, controls, conduct of associates, disciplinary actions, compensation, and product development. Supervision of retail and institutional customer activities has 32 questions on account opening, maintenance, public communications, transactions, and disclosures. Another 32 questions go to supervision of trading and market-making, including order handling, execution, settlement, and compliance reviews. Finally, 32 questions focus on supervision of investment banking and research, involving policies for activities, disclosures, pitch books, and marketing materials.
How Hard Is the Series 24 Exam?
Make no mistake, the Series 24 is a very hard exam. You won't find official pass rates, but check any forum, and you'll see people saying it's one of the toughest financial exams out there. It demands serious study time and a deep grasp of the material to hit that 70% passing grade.
What Is the Series 24 Pass Rate?
FINRA doesn't publish the pass rate for the Series 24. That said, those who've taken it often say it's much harder than the prerequisite exams, which is why prep courses and FINRA recommend dedicating a good chunk of time to prepare for this intense test.
What Are the Requirements to Get Additional Time on the Series 24 Exam?
There's no info on FINRA's site about getting extra time for the Series 24. The exam is structured so you should have enough time to answer everything and revisit any questions you're unsure about.
Do I Need a Series 79 If I Have a Series 24?
Actually, it's the other way around: you need the Series 79 as one possible prerequisite before taking the Series 24. Other options include the SIE plus Series 7, SIE plus Series 57, SIE plus Series 82, or SIE plus Series 86 and 87. You could skip the SIE and just do the Series 16 as a prerequisite. If you only have the Series 79 and SIE, you'd qualify for Investment Banking Principal registration.
The Bottom Line
The Series 24 is a tough exam with hefty prerequisites, and you need sponsorship from a FINRA member or similar organization to take it. If you're going for it, you're aiming to oversee compliance in areas like advertising, market making, trading, and underwriting.
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