In 2015, FINRA reevaluated its testing procedures for securities licensure. Agency members were looking for ways to make the Series exams testing procedures more efficient and more productive in preparing those entering the securities industry. They found that much of the same basic content was repeated across all Series exams and that the testing procedures allowed individuals in non-licensed roles to work in the industry without proving they had a solid understanding of critical securities industry concepts. As a result, they created the Securities Industry Essentials Exam to make testing less repetitive and include more employees in testing for basic securities knowledge.
How the SIE exam works
The SIE exam became a new requirement in 2018. Licensed securities representatives now take the SIE exam and their desired Series exams as co-requisites, though the SIE exam is designed to be taken first. As a result of the SIE, Series exams are now “top-off” exams that are far shorter and include only questions related to the specific licensing for that Series credential. This allows securities representatives to take multiple top-off exams more efficiently.
The SIE exam is recommended for most securities industry employees who are in non-licensed roles, such as marketing or legal. Concepts on the exam pertain to their jobs. The SIE exam was also designed to prepare students for work in the securities industry, whether as a financial advisor or in another role. A corporate sponsor is not required, opening the exam to current college students. Obtaining this qualification gives them a leg up when applying for jobs in the securities industry and qualifies them for taking licensing exams such as the Series 7 as soon as they obtain a corporate sponsor.
SIE exam content
Preparation for the SIE exam teaches the nuts and bolts of the securities industry, including the following:
- Industry structure and function
- Regulatory agencies
- Basic economics
- Basic product knowledge
- Prohibited practices
- Professional conduct
Understanding these concepts prepares students to enter the securities industry. Understanding the securities industry structure and function makes on-the-job training more efficient. Passing the SIE confirms that new employees understand industry terminology. And how markets and securities products function and why certain regulations are in place. This makes new employees more professional, knowledgeable and confident.
The securities industry is highly competitive. Students know they can make big money and gain prestige by succeeding in the securities industry. Many dream of entering this industry, but it’s not for everyone. It takes long hours and dedication to details, as well as aptitude for economics and investing. The SIE exam provides students with an opportunity to determine if the securities industry is the right career path for them.
Passing the SIE exam also speaks volumes to employers. It shows that the student is dedicated to succeeding in the securities industry, can pass Series exams and has the aptitude for working with investments. For these reasons, employers are more likely to interview and hire students who have obtained the SIE exam credential.
Schools help students when they offer the SIE exam as part of their education. When students graduate with the SIE exam credential, employers take their application more seriously. This applies regardless of the role the student applies for. But, passing the test also prepares them for the top-off securities license exams. In addition, students have the chance to better evaluate their interest in the securities industry and to enter the industry as a knowledgeable professional ready to hit the ground running.
Are you interested in offering the SIE exam as part of your school’s curriculum? Visit Securities Training Corporation’s website to learn more about the SIE exam.