The FINRA Series 7 exam is organised into four job functions - Seeks Business (7%), Opens Accounts (9%), Provides Information and Makes Recommendations (73%), and Processes Transactions (11%) - tested through 125 scored multiple-choice questions in 3 hours 45 minutes, with a passing score of 72.
The weights below come from FINRA’s official 2025 content outline, which is authoritative; this page is a plain-English summary of what each function covers and what that means for your study plan.
The four functions at a glance
| # | Job function | Weight | Scored questions |
|---|---|---|---|
| 1 | Seeks Business for the Broker-Dealer from Customers and Potential Customers | 7% | 9 |
| 2 | Opens Accounts After Obtaining and Evaluating Customers’ Financial Profile and Investment Objectives | 9% | 11 |
| 3 | Provides Customers with Information About Investments, Makes Recommendations, Transfers Assets and Maintains Appropriate Records | 73% | 91 |
| 4 | Obtains and Verifies Customers’ Purchase and Sales Instructions and Agreements; Processes, Completes and Confirms Transactions | 11% | 14 |
Unlike exams organised by subject, the Series 7 outline follows the workflow of a registered representative: finding customers, opening their accounts, advising them, and processing their trades. Product knowledge is not a separate section - it is embedded in Function 3, which is why that function dominates.
Function 1 - Seeks Business for the Broker-Dealer (7%, 9 questions)
The prospecting function. It covers how representatives may contact and communicate with the public: the standards for communications, the three FINRA communication categories (retail communication, correspondence, institutional communication) and who must approve what, telemarketing rules and calling-time limits, seminars and public appearances, and the additional approval and disclosure rules that apply when communications discuss options. Nine questions sounds small, but the communication categories are easy marks if you learn the 25-investor boundary and the approval rules cold.
Function 2 - Opens Accounts (9%, 11 questions)
The onboarding function. Expect questions on account types and registrations - cash, margin, options, discretionary, custodial (UTMA/UGMA), joint accounts (rights of survivorship versus tenancy in common), retirement accounts, and accounts for employees of other broker-dealers - plus the information a firm must collect: identity verification under the Customer Identification Program, know-your-customer obligations, and the investment-profile facts that drive suitability. The special sequences matter: an options account needs the disclosure document delivered no later than account approval and a signed options agreement returned promptly afterwards, and a margin account needs the margin agreement signed before the pledge of securities works.
Function 3 - Provides Information, Makes Recommendations, Transfers Assets and Maintains Records (73%, 91 questions)
The heart of the exam and the reason the Series 7 has its reputation. This single function carries nearly three quarters of the scored questions and contains essentially all product knowledge:
- Equity securities - common and preferred stock, rights, warrants, ADRs, dividend mechanics.
- Debt securities - corporate bonds, yields and pricing, convertibles, US government and agency securities, mortgage-backed structures such as CMOs, and money-market instruments.
- Municipal securities - general obligation versus revenue bonds, short-term notes, new-issue underwriting, official statements and legal opinions, and the tax treatment that drives their appeal.
- Packaged products - open-end and closed-end funds, sales-charge rules and breakpoints, ETFs, UITs and REITs.
- Variable annuities - separate accounts, accumulation and annuity units, the assumed interest rate, and tax-free 1035 exchanges.
- Direct participation programs - limited-partnership structure, liability, and evaluation.
- Options - the four basic positions, premiums, hedging and income strategies, spreads and straddles, index options, and exercise and assignment mechanics.
- Margin and taxation - Regulation T, maintenance requirements, SMA, and the tax rules (capital gains, wash sales, cost basis) that shape recommendations.
- Suitability and records - matching recommendations to the customer’s profile under FINRA’s suitability rule and Regulation Best Interest, and keeping appropriate records.
If you weight your study plan by anything, weight it by this list. Options, municipal securities and margin calculations are the classic effort sinks; packaged products and suitability are the classic easy marks.
Function 4 - Obtains and Verifies Instructions; Processes and Confirms Transactions (11%, 14 questions)
The operations function. It tests order types (market, limit, stop, stop-limit) and time-in-force instructions, order tickets and what may be changed after execution, regular-way and cash settlement, trade confirmations and account statements, account transfers through ACATS, how open orders are adjusted for corporate actions, and how errors and customer complaints must be handled. The material is mechanical and finite - a strong final-week review usually secures most of these 14 questions.
Format, timing and scoring
The exam delivers 130 questions - 125 scored plus 5 unscored pretest questions mixed in without identification - over 225 minutes (3 hours 45 minutes), which works out to roughly 100 seconds per question. The passing score is 72 on a 0-100 scale; scores are statistically equated across exam forms and there is no penalty for wrong answers, so answer everything. All questions are four-option multiple choice.
How the Series 7 relates to the SIE
The Series 7 assumes the foundation the SIE tests. The SIE covers basic products, markets and regulation and is open to anyone; the Series 7 requires sponsorship by a FINRA member firm (via Form U4) and goes far deeper on every product, especially options, municipal securities and margin. You must pass both - in either order - before the General Securities Representative registration takes effect, and most candidates take the SIE first because it needs no sponsor and its content is a strict subset in spirit.