So you want to be a stockbroker? The good news is that a career in the securities field can be extremely lucrative and rewarding. The not-so-good news is that anyone who plans to become a stockbroker and sell securities in any of the 50 states must first pass the Series 7 exam, a monster of a test. And to accomplish this, you have to commit time and effort.

I passed the Series 7 exam (back when 250 questions counted toward your score) the first time with a very high score, but it required weeks of study and sacrifice. Those who aren’t totally prepared on exam day are in for an unpleasant wake-up call. I always get a few students in every class who’ve enrolled after they already failed the exam the first (or second) time they took it. Most of them initially expected the same easy ride that they’d experienced in high school or college. Not only were they wrong, but they also had to pay hundreds of dollars to reregister for the exam and wait another 30 days (a mandatory FINRA rule) before they could retake the exam.

Back to the good news again. You’re obviously interested in doing well, so you probably won’t be one of those people. This book can help you pass the Series 7 and achieve your goal.

About This Book

This book should be all you need to pass the exam, although I certainly encourage you to view other materials and take whatever exams you can get your hands on.

I cover the topics that appear on the test, offer formulas, provide definitions, and go over the foundational information you need to know. I also include lots of tips and a few memory tricks. But the real benefit of this book is finding out how to study and think through problems as well as you possibly can. That’s why I help you choose a study program, explain how to handle specific question types, warn you about common mistakes, connect concepts, and show you how to pull questions apart and get to the bottom of what’s being asked. You then get to apply this knowledge in two full-length practice test so you get a taste of the Series 7 experience.

This is a reference book, and most sections are self-contained. In other words, you can read a section and understand it without looking over the text that comes before it. When some background information is helpful, I give cross-references to related topics. Therefore, you can pretty much jump in and out whenever you find topics you like (and when you find those you don’t). And like all good tour guides, I also point you to some other sites of interest — topics you can explore further on your own.

I’ve scattered sample questions throughout this book so you can test your understanding of new info and get a feel for Series 7 questions. And of course, for those sections that don’t include questions, remember that the practice tests that come with this book deal with all kinds of subjects.

I also use the language and lingo of FINRA. That means you see official names (like the Federal Reserve Board), nicknames (the Fed), and acronyms galore (like the FRB). That way, during the test, understanding the POPs, YTMs, TEYs, NAVs, EPSs, ADRs, LMVs, DRs, and so on shouldn’t be too much of a hassle.

If you’re short on time, you can skip the sidebars, which are those little gray boxes that contain interesting but nonessential information.

Foolish Assumptions

While writing this book, I made a few assumptions about you and why you picked up this book. For starters, I assume that you’re looking for a no-nonsense study guide to supplement your textbook or prep course — one that provides a ton of example questions and some sample exams. Look no further! Whether you’re preparing to take the test for the first time, retaking the test after a less-than-stellar performance, or looking for a refresher before you recertify, this is the book for you!

Icons Used in This Book

To make this book easier to read and use, I include some icons to help you find and fathom key ideas and information.

This icon highlights example Series 7 test questions (which I follow with helpful answer explanations).

This icon is attached to shortcuts and insider advice for studying for and passing the Series 7 exam.

This icon points to information that’s especially important to remember in order to do well on the test.

This icon warns you away from actions that can harm your work and drop your score.

Beyond the Book

In addition to reference material and sample exams, this book also comes with access to some really useful online material. For additional tips and tricks, check out this book's free Cheat Sheet by going to www.dummies.com and typing for “Series 7 Exam For Dummies cheat sheet” in the search box.

You also get access to an online database of practice exams. The two exams in this book are online, and you can also take two additional exams for even more practice.

To gain access to the four online exams, all you have to do is register. Just follow these simple steps:

1. Find your PIN access code:
   • Print-book users: If you purchased a print copy of this book, turn to the inside front cover of the book to find your access code.
   • E-book users: If you purchased this book as an e-book, you can get your access code by registering your e-book at www.dummies.com/go/getaccess. Go to this website, find your book and click it, and answer the security questions to verify your purchase. You’ll receive an email with your access code.
2. Go to Dummies.com and click Activate Now.
3. Find your product (Series 7 Exam For Dummies) and then follow the on-screen prompts to activate your PIN.

Now you’re ready to go! You can come back to the program as often as you want. Simply log in with the username and password you created during your initial login. No need to enter the access code a second time.

Where to Go from Here

Although you can read this book from start to finish, you can certainly work your way through in more creative ways. Where you start is up to you, though please, please don’t start with the tests! Give yourself a good grounding in the content here, and then use the tests to evaluate your understanding and show you where to focus your studies. You can flip to the topics you think you understand fairly well to boost your confidence or skip directly to whatever’s giving you trouble — let the index and the table of contents be your guides. If you have a good understanding of how to take the Series 7 exam, from how it’s structured to how to tackle questions, then you can go directly to the chapters in Parts 2 or 3, which address types of securities. If you’re feeling shaky on the legal aspects, check out the FINRA rules and regulations in Part 4. Everyone, however, can probably benefit from Part 1’s test-taking basics and info on study plans. Wherever you go, feel free to take detours to your textbooks, flash cards, FINRA websites, and any other resources for more information. Just remember to come back so you don’t miss anything here!