SIE study guide: Pass the first time

If you’re pursuing a career in finance, then you may already know that the Securities Industry Essentials (SIE) exam is the first step to unlocking your professional goals. From the bustling streets of New York’s financial district to the financial advising office at your local bank branch, a variety of finance career paths are opened up by passing this foundational examination. The SIE is often a requirement for entry-level finance opportunities and opens doors to advanced licensing and specialized roles down the road.

The SIE exam is administered by the Financial Industry Regulatory Authority (FINRA), the organization responsible for licensing financial professionals and regulating the securities industry. The SIE test focuses on fundamental concepts related to financial services, requiring a core understanding of investment vehicles like stocks, bonds, and mutual funds. Throughout the SIE exam, you will encounter questions on basic investing principles, different types of investment products, important regulatory guidelines, and common practices within the financial industry. Passing the SIE requires you to demonstrate the foundational knowledge required for anyone starting a career in finance, from dedicated MBA students to diligent career-switchers.

How hard is the SIE?

The SIE is considered to be moderately challenging but approachable for early-career professionals in finance. Thousands of candidates take (and pass!) the SIE every year, including many without a “traditional” finance background. About three-quarters of first-time test takers pass the exam on their first attempt, and a score of 70% or above is required to pass. The SIE’s difficulty level depends on the level and experience of each individual test-taker. Finance students and those who have some work experience in the financial industry will likely be familiar with the foundational content covered on the exam. Candidates with less finance-heavy backgrounds will need to take time to learn and review the financial and mathematical concepts presented on the test.

What’s on the SIE?

The SIE covers the foundations of financial markets, products, risk evaluation, and regulatory practices. When considering the exam’s difficulty, it’s important to first understand its precise structure: the SIE consists of 85 multiple-choice questions with a time limit of 1 hour and 45 minutes. Of these, 10 are classified as “experimental” and are not factored into your final score. Thus, only 75 questions contribute to the results that determine your passing status.

The SIE divides questions into the following main content categories:

Keep in mind that actual numbers and weighting may change slightly depending on how your study materials align with the official FINRA content outline, but this exam blueprint provides an accurate idea of what to expect.

A detailed analysis of each subject area can help you pinpoint which parts of the test may require extra preparation. Below, we’ll explore each section individually, starting with the most heavily weighted topics. This way, you can better focus your SIE exam study strategies on the areas that will impact your score the most.

Understanding Products and Their Risks

33 questions: 44% of the exam

If you have a basic understanding of the financial industry, then you are likely aware of stocks and bonds. However, there are many financial products investors can choose from. The SIE exam will focus only on a small selection of commonly traded investments, which include:

• Equity securities (common and preferred stock)
• Exchange-traded funds
• Exchange-traded notes
• Debt securities (bonds)
• Options
• Investment Companies (for example: mutual funds)
• Direct Participation Programs
• Hedge funds

Each product has its own benefits and risks and suits a specific type of investor. The exam requires knowledge of investment characteristics, how they function, and how they are taxed. In addition, there are the underlying ethics, rules, and regulations of each kind of financial product.

Understanding Trading, Customer Accounts, and Prohibited Activities

23 questions: 31% of the exam

After you learn the various financial products, you’ll need to learn the rules of trading them and what type of accounts hold them. There are also rules and ethics that govern how to operate as a financial professional.

Trading securities can be detailed and complicated, but the SIE tends to focus on the basics. You’ll need to understand how investors do financial transactions and the different ways to submit orders to the market. Investors can specify certain requirements for their trade: for example, requesting that a stock be bought for $50 or less. You’ll need to demonstrate proficiency in the basics of trading securities and the mechanics of the financial markets.

Customers can open and maintain several different types of accounts. You will be asked questions on the specifics of these accounts, including ownership status, tax status, and paperwork required to open them. The accounts typically tested include:

• Individual
• Joint (with rights of survivorship and tenants in common)
• Business accounts
• Discretionary accounts
• Options accounts
• Margin accounts
• Retirement accounts
• Educational accounts

FINRA values registered representatives who understand and follow ethical principles. In this section, you’ll also be asked questions on topics ranging from market manipulation to insider trading. Your job is to demonstrate a general knowledge of what practices to avoid and how to operate ethically in finance.

Knowledge of Capital Markets

12 questions: 16% of the exam

You might be wondering what a capital market is. Capital is another term for an asset, which usually takes the form of money in finance. When a company or an organization wants to raise large sums of money, it can do so through a variety of means. You may have heard of an IPO, or an initial public offering. That’s one of the most common ways to raise capital in finance.

Along with understanding how companies and organizations raise money through selling financial products, you’ll need to know about different finance regulators and how they operate. The Securities and Exchange Commission (SEC), a government agency, and FINRA write rules that govern and regulate these markets at a national level. The MSRB (Municipal Securities Rulemaking Board) writes the rules for municipal (city and state) markets.

Economic conditions can also greatly affect financial markets and investment choices. Therefore, the SIE will test your knowledge of the basics of the economy and how economic trends drive markets. Government decisions (monetary and fiscal policy) around spending and setting interest rates are also tested.

Overview of the Regulatory Framework

7 questions: 9% of the exam

Rules, rules, and more rules. Whenever the word “regulatory” appears, you’re going to be required to recall laws, regulations, and general rules of the industry. As a registered representative, there are many conduct rules you must understand and follow to work in the industry. Typical questions from this section focus on:

• Customer complaints
• Outside business activities
• Entertaining customers
• Gifts given and received
• Political contributions
• Required disclosures to FINRA and customers

Bonus: Experimental Questions

On the official SIE exam, you’ll encounter 85 multiple-choice questions, including 10 “experimental” questions that are unscored and do not impact your final result. These trial questions can be from any category and are mixed in with the rest, so approach each question as though every one is scored. Avoid getting stuck on one question: it’s crucial to keep moving and answer as many questions as you can during the time limit for the best chance of passing. There’s no penalty for guessing, so try to answer all questions within the allotted time.

Do I need a sponsor to take the SIE exam?

The answer is: No! You can take the SIE without sponsorship from a FINRA firm. This is a great way to improve your resume and show firms both that you’re serious about a finance career and that you understand key industry concepts.

You should prepare for the exam using a FINRA SIE Exam prep course (see our comparison of different SIE Exam prep vendors). Once you’re ready, you can sign up to sit for the SIE Exam by registering on FINRA’s website and then visiting the Schedule An Exam page.

However, the SIE by itself does not fully license you for any of the licensed finance roles. In order to complete your license, you need to take a top-off exam.

The FINRA Top-Off Exams are:

1. Series 6: Investment Company Representative (IR)
2. Series 7: General Securities Representative (GS)
3. Series 22: DPP Representative (DR)
4. Series 57: Securities Trader (TD)
5. Series 79: Investment Banking Representative (IB)
6. Series 82: Private Securities Offerings Representative (PR)
7. Series 86 and 87: Research Analyst (RS)
8. Series 99: Operations Professional (OS)

You will need to be sponsored by a FINRA firm to be eligible to attempt and pass the above exams. Once you pass the SIE and the corresponding Top-Off Exam, you will get the license listed above and expand your credentials.

How to study for the SIE Exam

Review exam requirements.

Before beginning your preparation, there are certain eligibility requirements you must meet to be able to sit for the SIE:

1. Age: You must be at least 18 years old.
2. Exam fee: Once you’ve completed the prerequisites, you must schedule your exam at a Prometric test center near you and pay the $80 test-taking fee.

Analyze the content and rate your knowledge

When you’re planning out your SIE study plan before test day, be sure to spend a bit of time assessing your knowledge of each section. Do a couple of practice questions from each one, as well as a diagnostic SIE practice test. Take note of your confidence with each section to see which areas need the most improvement.

Prepare a study schedule

Give yourself a realistic time budget for studying for the SIE. Carefully consider how many hours you can dedicate to preparation between now and your test day. The key is establishing a smart study schedule tailored to your needs. Most comprehensive SIE courses suggest around 50 hours of study time to fully learn the material. However, if you’ve already built a strong knowledge base and are focused on a final review, a targeted 20 hours is usually sufficient. Companies will sometimes have entry-level employees complete a one- to two-week SIE “crash course” designed to prepare candidates to pass the exam quickly. No matter how much time you have, Achievable makes it easy to plan an SIE study schedule with our interactive study planner.

After determining your total study hours, effectively divide your time based on two crucial factors: your confidence with each subject area and the weight each section carries on the SIE exam. The best strategy for SIE exam mastery is to concentrate on high-value topics where you have the greatest opportunity for improvement. This focused approach ensures you maximize your score increase within your timeframe. Be sure to complete plenty of SIE practice questions throughout your studies to verify you’re fully prepared for exam day.

Schedule? I have no time!

But what if you’re way behind and the exam is only a few days away? The good news is that you can usually cover more material than you expect. Research shows that most students start losing focus after about three hours of continuous study. However, with just a one-hour break, they can put in another three productive hours. It’s not ideal, but in a pinch, it works.

For the best results, use a steady and consistent approach: study for at least a couple of weeks while regularly reviewing what you’ve already learned to reinforce it.

Use quality study materials

Be sure to study with an SIE textbook and a structured course plan that includes review questions and guided instruction. Working with a tutor who specializes in the SIE can help you master difficult concepts and stay accountable to your schedule. Supplement your learning with flashcards, quick-reference “cheat sheets,” and videos to reinforce the most important topics. When choosing a study program, look for one that provides a variety of resources and even a pass guarantee, so you know you’ll be fully supported. To jump-start your prep, check out Achievable’s SIE library, featuring free videos, podcast episodes, and reference sheets.

The learning science powering Achievable offers a proven strategy for studying for the SIE exam efficiently. Our platform monitors your progress through each section of the SIE content and optimally schedules review sessions to maximize your memory retention. This ensures you get the most value out of every minute spent preparing for the SIE, making your study plan both thorough and time-effective.

Practice under real conditions

One of the most effective ways to prepare for an exam is by practicing with realistic, timed questions. Simulating actual test conditions not only helps you get comfortable with the format but also ensures you can complete all required questions within the time limit.

For the SIE exam, you’ll have 1 hour and 45 minutes to answer 85 questions, which translates to about 1 minute and 24 seconds per question. Success requires more than just knowing the material; you’ll also need to be confident in interpreting the question wording and applying your knowledge quickly. To strengthen your performance, keep an error log of missed questions and review key topics at the end of each week. This consistent reflection will help you identify and close any gaps in your understanding.

Prepare for exam day

One of the most commonly asked questions of FINRA instructors is “What is taking the test actually like?” Here are some insights from our FINRA course author, Brandon Rith:

Preface: Preparing for test day

Before talking about what happens on test day, we wanted to remind you that how you approach test day makes a big difference. Make sure you’re bringing your best self to the test day: get plenty of sleep the night before, eat a bit of food beforehand, and maybe perk yourself up with a workout or some jumping jacks. This also helps a lot with nervous energy: you’re going to perform much better if you are cool, calm, and confident going into the exam.

Checking in

When you first walk in the door of your testing center, you’ll need to tell them what test you’re taking and give them a current government ID, like a driver’s license or passport. Then, you’ll need to sign a disclosure form that’s pretty straightforward: no cheating, don’t bring weapons into the test center, etc. After that, you put your belongings into a locker except for that same ID. They will also ask you to turn off your cell phone before putting it in the locker.

Once that’s done, you’ll be taken to another part of the test center to be “admitted” to the test environment. This consists of answering a couple more questions and being patted down, similar to an airport security checkpoint. This is to ensure you’re not somehow bringing notes in. They will also take a picture of you for their records to confirm that someone else did not take the test on your behalf. To ensure a smooth check-in process, try to arrive at the test center at least 30 minutes to an hour before your scheduled test time.

The SIE exam test experience

Once you’re admitted, you will enter a completely silent room with a bunch of computers and other test takers. They’ll often be taking other tests than the one you’re taking, so there’s no sense in trying to take a peek. The room is also fully covered by security cameras.

You’ll be sat down at your computer and given “scratch paper,” which is really a laminated sheet and a dry-erase marker. You are also given a pair of noise-canceling headphones, which is great for concentration (some test centers will also give you earplugs if asked as well). You then need to take a tutorial on the computer test system to ensure you know how it works. Then, finally, it’s time to take the test.

If you have anything you want to keep track of, whether that be key equations, notes, or frameworks, write them down immediately after your test starts. That way, you won’t need to re-remember them later in the exam and can stay “in the zone” of answering questions. Second, don’t be distressed if you do end up getting nervous at this point. Even experienced test takers will get nervous at the beginning of a new test: focus on answering the first 10 questions, and your nervousness should go away.

Wrapping up the SIE Exam

Once you finish the test, you’ll be prompted (sometimes at length) to confirm that you’re happy with your answers and ready to submit your final exam. For most FINRA tests, you will get a score back immediately following that screen. This will tell you whether you passed right away.

Then, you just need to gather your belongings and head out. You may be asked to fill out a survey about the experience (was the test center accommodating, etc), but otherwise, you can just pick your stuff out of your locker and sign out. When signing out, be sure to get a printout documenting your score if you passed for a paper copy for your records. And that’s it! Your test is complete.

SIE retake policy

You can take the SIE exam multiple times if needed, but there are specific waiting periods between attempts that you must follow. The FINRA SIE follows the same retake rules as other FINRA exams:

• After your first failed SIE attempt, you must wait 30 days before retaking the SIE exam.
• If you do not pass on your second attempt, you are required to wait another 30 days before sitting for the SIE again.
• Failing the SIE a third time means you must observe a 180-day waiting period before you can retake the exam.
• For every subsequent SIE attempt after the third failure, you must continue to wait 180 days between each try.

It’s reassuring to know that there is no lifetime limit: you can take the SIE as many times as needed, provided you observe the required waiting periods. Staying committed to your SIE study plan and reevaluating your strategy if you don’t succeed the first time can make a significant difference in your success.

Final takeaways

Building a long-term career in finance and moving up in the industry begins with passing the SIE. Preparing for your first FINRA test can seem overwhelming, but with the right plan, you can set yourself up to pass for the first time. Consistent study over several weeks, along with regular review, is the most reliable way to retain what you’ve learned. With a focused strategy, you’ll increase your chances of passing the SIE on your first try, opening up a world of opportunities in the financial sector and making future licensing exams more manageable.

Achievable offers comprehensive prep courses for the FINRA SIE exam and several Top-Offs. We’re here for you every step of the way: try our courses for free today.