The Series 6 license must be held by mutual funds representatives whether working directly for the mutual fund or one of their representatives. Any person who sells variable annuities or mutual funds must hold this license and be registered with FINR, formally known as the NASD. This license is also required by certain back office employees of a mutual fund company. Persons who quote prices or speak with the public are required to have the license.
To obtain such a license a person must be sponsored by a member of the securities industry. Generally, these persons are employed as trainees by a firm and after a period of time are sponsored to go forward to the test. Some firms hold their own training classes, which gives them the opportunity to gauge the employees’ chances of passing the exam before actual sponsorship is granted. Others will require their employees to attend a “fast track” class usually lasting one to two weeks before allowing an attempt at the exam. Still others require employees to study outside of work and to prepare on their own. These firms may or may not reimburse employees for the cost of books, discs or other costs such as classes.
The Series 6 license exam is given in a testing center by an independent testing service. The environment is highly secure, requiring a picture ID for entrance and only supplied paper and pencil in the testing area. The test is taken on a computer, unless you have presented a valid medical request to take the exam in another medium. Exceptions can be made to take the exam orally or in written form for those with a verified handicap.
The exam covers the various types of securities focusing on mutual funds and how they are managed. The 100 questions are multiple choices and are often said to be difficult, as concentration on the wording and mathematics are necessary to obtain a correct answer. Passing grade for the test is 70% and many do not pass. The score is presented at the conclusion of the test.
If successful, the employee becomes a registered representative of the sponsoring firm and is licensed to sell mutual funds. Many in-house positions with the firm will also require this license due to the nature of the position. Persons who hold this license are marketable in the securities industry, as it guarantees a certain level of knowledge of mutual funds.
The Series 6 license is a valuable asset to anyone who wishes to work in the investment industry. This license must remain registered with the NASD/FINR in good standing through an active firm. If the representative wants to maintain the license, they must complete a continuing education course every two years and be an active registered representative with no lapse in registration greater than 24 months. Maintaining a Series 6 license is similar to maintaining job security in the mutual fund industry. These licenses are respected and desired by anyone who wishes a profession in the mutual fund arena.