Finance Careers
Posted By Tyler York

Finance Career Paths and the Top-Off Exams You Need To Get Them


Finance has a number of different career paths to choose from, spanning a wide range of skills from cold call sales to technical analysis. Luckily, there is a small trick to help us get a lay of the land: each different major career path within finance has a certification and corresponding FINRA Exam that you would need to pass to be licensed for that role. This gives us a high level overview of different career directions within finance.

First, everyone must pass the SIE Exam: FINRA’s new entry-level exam for people looking to get a job in the finance industry. You can take the SIE Exam without being sponsored by a FINRA member firm.

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Does that mean that once you pass the SIE, you’re licensed and ready to be a financial advisor or trader, perhaps independently? Not quite.

Before you can do any licensed activities in the finance industry, you need to complete your license – the SIE Exam is only the first part. The second half is now what’s called a Top-Off Exam, and these Exams are similar in content to the old FINRA Series Exams by the same names. You still need to be sponsored by a FINRA member firm in order to take a Top-Off Exam.

Each Top-Off Exam represents your specialization into a different part of the finance industry. The 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)

In this post, we’re going to go into each Top-Off Exam and the roles that it enables you move into. This should give you a good overview of the 8 most common licensed career paths that you can understand in the finance industry.

Series 6 Investment Representative
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Series 6: Investment Company Representative (IR)

Passing the Series 6 Top-Off Exam gives you the ability to become an Investment Company Representative, which gives the license holder the ability to sell “packaged” financial products like mutual funds, variable annuities, unit investment trusts (UITs), and insurance. In practicality, this license is most commonly for people working in insurance advisorship and sales at a finance or insurance firm.

What’s the difference between a Series 6 and Series 7 license?

The role is similar to the Financial Advisor role that you can get by passing the Series 7, but is limited in what you can sell. Series 6 license holders cannot sell corporate or municipal securities, direct participation programs and options.

Common addition: Life and Health

Most people with a Series 6 end up also passing an additional exam called Life and Health, which broadens the types of insurance they are able to sell. Passing Life and Health gives you the license to sell life insurance, accident and health insurance, annuities, long-term care insurance, and medicare supplement insurance.

Series 7 General Securities Representative
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Series 7: General Securities Representative (GS)

Passing the Series 7 Top-Off Exam gives you the ability to sell almost all major consumer security types, including common and preferred stocks, call and put options, bonds, and other individual fixed income investments. It also gives you the ability to sell all of the packaged products except for those that also require a Life and Health Insurance license to sell.

The only products that Series 7 licensees are not authorized to sell are commodities futures, real estate and life insurance – all three of which simply require an additional license.

The Series 7 is by far the most common FINRA Top-Off Exam passed as it is the most versatile and most widely used. People with a Series 7 license are called “registered representatives” officially, but are commonly referred to as financial advisors and stockbrokers.

Series 22 DPP Representative
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Series 22: DPP Representative (DR)

Passing the Series 22 Top-Off Exam gives you the ability to work with and sell direct participation program (DPP) products. A DPP is a non-traded pooled investment that is either in real estate or energy that generally is over a long time frame. They are a way for retail investors to get a piece of big, cash-intensive investment projects like a real estate or energy venture without having substantial capital to invest.

The Series 22 and DPP Representative role is quite specialized, and only recommended for people already interested in this specific career or as an additional license that people obtain after earning their primary license.

Series 57 Securities Trader
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Series 57: Securities Trader (TD)

Passing the Series 57 Top-Off Exam gives you the ability to trade equity and debt securities as a Securities Trader Representative. With this license, you can do NASDAQ trading, over-the-counter (OTC) equity trading, and proprietary trading. The roles commonly associated with the Series 57 are Equity Trader, Fixed Income Trader, Foreign Exchange (Forex) Trader, Commodities Trader, or Derivatives Trader. Here’s a short summary of each:

  • Equity Traders work with publicly listed stocks and shares, often for an Asset Management firm.
  • Fixed Income Traders work with bonds, government securities, or fixed income assets. Their scope also expanded to riskier products like collateralized debt obligations, which were a key piece of the 2008 financial crisis.
  • Foreign Exchange (Forex) Traders work with foreign currencies and generally try to make money from fluctuations in currencies related to economic opportunity, politics, and events.
  • Commodities Traders work with commodities like gold, iron, crude oil, soybeans, et cetera. Similar to Forex Traders, Commodities Traders will seek to profit from fluctuations in these resources due to different macro factors.
  • Derivatives Traders work with options, futures, and other leveraged products. This is the riskiest work, as the leveraged bets have low capital requirements and high potential for upside or downside.

The Series 57 was previously the Series 55, but was revamped with the advent and widespread adoption of high-frequency trading.

Series 79 Investment Banking Representative
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Series 79: Investment Banking Representative (IB)

Passing the Series 79 Top-Off Exam gives you the ability to work in investment banking, a highly lucrative and also extremely competitive field. Investment banking at the entry level is roughly comprised of two areas: Debt or Equity Offerings, and Mergers & Acquisitions and Restructuring.

Debt or Equity Offerings

This category of work is what companies undertake when they’re offering up either their debt or stock to be purchased by the broader public in exchange for capital. The pricing of these securities falls under investment banking, as does their creation (called origination). Investment banks will take on the underwriting (essentially ‘sponsoring’) of the security, marketing it, structuring it, and syndicating it. It also managed the allocation and stabilization activities of these offerings.

Mergers & Acquisitions and Restructuring

This category of work is what companies undertake when they’re looking to either purchase another company, be sold to another company, merge with another company, or ‘restructure’ their company.

When dealing with mergers and acquisitions, investment bankers tender offers, price the asset being purchased or sold fairly (or in their client’s favor), and handle all of the logistics involved. In return, the investment bank gets a cut of the deal.

Restructuring, in this context, often means the reorganization of a company’s business units or divestitures – selling off or killing off business units within that business. For example, if your company sold four products and each product was a 100-person ‘business unit’, selling one to a competitor to get out of a tough market or reduce costs would be a divestiture.

The Series 79 Top-Off Exam is the second most popular top-off exam due to the size and turnover in the investment banking industry. Be warned – investment banking is notorious for both the incredible earning potential (new college graduates often earn six figures in major cities) and rigorous hours (sometimes over 80-100 hours per week). If you’re interested in investment banking, we highly recommend WallStreetOasis, an Achievable partner and a community of investment bankers and aspiring investment bankers.

Series 82 Private Securities Offering Representative
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Series 82: Private Securities Offerings Representative (PR)

The Series 82 Top-Off Exam gives you the ability to facilitate private securities transactions on behalf of your sponsor organization. Most of the stock (securities) trading you think of is probably public – the NYSE, NASDAQ, and other markets all have companies whose shares can be purchased by anyone. However, there is an opaque market for private securities that has become more prominent with the rise of startups that often stay private longer and at higher valuations.

Like the Series 22, the Series 82 Top-Off Exam is quite specialized and often recommended only after you get a more general securities license.

Series 86 Series 87 Research Analyst
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Series 86 and 87: Research Analyst (RS)

Passing the Series 86 and 87 Top-Off Exams gives you the ability to produce research reports for financial firms. Research Analysts collect data about a firm, industry, and competition, and then analyze that data to determine the value and trajectory of that company. Financial modeling and other technical analysis is a key piece of this work. Then, the Research Analyst prepares a research report for public consumption that bears their own name and their company’s name. As you can imagine, people put a lot of pride into these reports.

The Series 86 focuses on the research and analysis portion of the role, while the Series 87 focuses on how to prepare the research report and properly disseminate the information it contains.

Getting an Exception from the Series 86 & 87 Top-Off Exams

You can get an exception from taking the Series 86 Top-Off Exams if you have passed both Level I and Level II of the Chartered Financial Analyst (CFA) Exam, or both Level I and Level II of the Chartered Market Technician (CMT) Certification Examination. However, you will still need to take the Series 87. If you do not have a CFA and are seeking an exception, you must first pass one of the following exams: Series 7, Series 17, Series 37 or Series 38.

Series 99 Operations Professional

Series 99: Operations Professional (OS)

Passing the Series 99 Top-Off Exam gives you the ability to supervise brokerage operations. In a nutshell, this means being responsible for the day-to-day of a financial firm: transactions processing, procedures, and handling any applicable regulations. Your job is to make sure your firm is running smoothly and not breaking any laws.

Conclusion

There are many career paths you can take in finance. Whether you aspire to become an insurance or financial adviser, a trader, an investment banking representative, research analyst or operations professional, you need to pass the respective Top-Off Exam. Understanding more about each test and career path will help you orient your initial job search and hopefully land an internship or job that sets you on the right path.Before you take a Top-Off Exam, you must first get a job at a FINRA-registered firm and pass the SIE Exam. We recommend passing the SIE Exam before applying to jobs to help your resume stand out and show your competence with finance material. We also offer a great SIE Exam prep program that you can try for free – if you are so inclined :).

Good luck!

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The FINRA SIE Exam is a new test for students and career switchers that want to show their proficiency in finance. Passing the SIE before applying to jobs will help your resume stand out. The proof is in the results: our students have gone on to jobs at Goldman Sachs, Wells Fargo, Fidelity Investments, Edward Jones, and many other great firms.

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