Series 63 Practice Exam
This is a free 15-question sampler for the Series 63, the Uniform Securities Agent State Law Examination, written by the StudyPDF team from the published NASAA content outline. It covers the definitions the Act turns on, registration of persons and of securities, exemptions, the powers and remedies of the state Administrator, prohibited business practices, communications with clients and prospects, disclosure, and the fiduciary standard, mixing multiple choice, select all that apply and fill in the blank. Answer all 15 questions, then check your score and read the explanation for every question. Nothing here is legal, tax or investment advice.
Under the Uniform Securities Act, which of the following must register in the state as an agent?
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All 15 questions at a glance
Prefer to read before you play? Every question in the sampler is listed below. Answers and explanations stay collapsed until you open them.
1. Under the Uniform Securities Act, which of the following must register in the state as an agent?
- A. A receptionist at a broker-dealer who answers the phone and transfers callers to registered personnel
- B. An individual who represents a broker-dealer and takes buy and sell orders from customers in the state
- C. The broker-dealer firm itself, once it opens an office in the state
- D. A bank that sells its own certificates of deposit to its depositors
Show answer and explanation
Answer: B. An individual who represents a broker-dealer and takes buy and sell orders from customers in the state
Two words carry this definition. An agent is an individual, never a firm, and the individual has to be effecting or attempting to effect purchases or sales of securities for a broker-dealer or an issuer. Clerical and ministerial staff who never take an order and never solicit business fall outside it, and the firm is a broker-dealer, which is a separate defined term with its own registration. Watch for the trap of calling a firm an agent, because the Act never does.
2. Which of the following is a sale or an offer under the Uniform Securities Act?
- A. A gift of assessable stock
- B. A bona fide pledge of securities as collateral for a loan
- C. A stock dividend paid to existing shareholders who give nothing of value for it
- D. A gift of nonassessable stock with no strings attached
Show answer and explanation
Answer: A. A gift of assessable stock
Sale means any contract or disposition of a security for value, and offer means any attempt to dispose of a security or any solicitation of an offer to buy one. Value is the hinge. Assessable stock can require the holder to pay in more money later, so accepting it exposes the recipient to a future call, and the Act treats the gift as a sale. A pledge for a genuine loan, a stock dividend given for nothing, and a plain gift of nonassessable stock all fail the value test.
3. Which of the following are securities under the Uniform Securities Act?
Select all that apply.
- A. A variable annuity contract
- B. A fixed annuity that pays a guaranteed dollar amount for life
- C. A fractional undivided interest in an oil and gas drilling program
- D. A commodity futures contract on wheat
- E. An investment contract
- F. A whole life insurance policy with a stated death benefit
Show answer and explanation
Answer: A. A variable annuity contract, C. A fractional undivided interest in an oil and gas drilling program, E. An investment contract
The Act lists what counts, and the through line is that the holder's return depends on performance they do not control. A variable annuity leaves the investor exposed to market results, and an oil and gas fractional interest and an investment contract both pool money for a return produced by someone else's effort. Insurance products that promise fixed, stated dollar amounts are carved out by name, and so are commodity futures and forward contracts. The fixed versus variable line is the one this question is really testing.
4. A firm has no place of business in State A. In State A it effects securities transactions only with banks, insurance companies, investment companies and other broker-dealers. Under the Uniform Securities Act, in State A this firm is:
- A. required to register as a broker-dealer, because it transacts business with persons located in the state
- B. required to register as an investment adviser instead
- C. excluded from the definition of broker-dealer, so it does not register there as one
- D. exempt only for as long as it registers each of its representatives as agents
Show answer and explanation
Answer: C. excluded from the definition of broker-dealer, so it does not register there as one
This definition turns on two facts together: whether the firm has a place of business in the state, and who its clients in that state are. With no office in the state and only institutional clients such as banks, insurance companies, investment companies and other broker-dealers, the firm falls outside the definition of broker-dealer entirely. Note that being excluded from a definition is not the same as being exempt from a requirement, and the exam cares about the difference. A parallel exclusion covers a firm with no place of business in the state whose only clients there are existing customers who are not residents and are just passing through.
5. An accountant prepares a client's tax return and, while explaining the tax bill, suggests the client move money into municipal bonds. She bills her usual hourly accounting rate and charges nothing extra for the suggestion. Under the Uniform Securities Act she is:
- A. an investment adviser, because she recommended a specific type of security
- B. not an investment adviser, because the advice was incidental to her profession and she took no special compensation for it
- C. an investment adviser representative of her accounting firm
- D. a broker-dealer, because the conversation concerned buying securities
Show answer and explanation
Answer: B. not an investment adviser, because the advice was incidental to her profession and she took no special compensation for it
The definition has three prongs and all three must be met: advice about securities, being in the business of giving it, and compensation for that advice. Accountants, lawyers, teachers and engineers are excluded when the advice is solely incidental to their profession and they receive no special compensation for it. Break either half of that and the exclusion disappears, so charging a separate advisory fee, or advertising herself as an adviser, would pull her back inside the definition.
6. Complete the sentence.
Under the Uniform Securities Act, the firm in the business of effecting securities transactions for the accounts of others is a _____, and the natural person who represents that firm and takes customer orders is a _____.
Options for blank 1: broker-dealer, agent, issuer
Options for blank 2: broker-dealer, agent, investment adviser representative
Show answer and explanation
Answer: broker-dealer, agent
The Act keeps firms and people in separate boxes and never lets one entity wear both labels. A broker-dealer is a person, in practice usually a firm, engaged in the business of effecting securities transactions, while an agent is always a natural person representing a broker-dealer or an issuer. The advisory side splits the same way: the firm is the investment adviser and the individual is the investment adviser representative. Reading a question with those four boxes in mind resolves most of the definitional items on this exam.
7. An issuer is registering an offering with the SEC and wants the same offering registered in several states at the same time. Which state registration method is built for that?
- A. Registration by qualification
- B. Registration by notification, sometimes called filing
- C. Registration by coordination
- D. A notice filing
Show answer and explanation
Answer: C. Registration by coordination
Coordination exists exactly for an offering going through federal and state registration side by side, and the state registration becomes effective at the same time the federal registration does, once the state's filing conditions are met. Qualification is the fallback for an offering registered only in the state and demands the most disclosure, which is why issuers avoid it when they can. A notice filing is not registration at all, it is what a state may require, with a fee, for a federal covered security the state has no power to register.
8. Which of the following is an exempt transaction under the Uniform Securities Act?
- A. A solicited sale of an unregistered, nonexempt security to a retail client
- B. An advertised public offering of common stock to residents of the state
- C. A sale by an issuer to fifty retail investors who answered a newspaper advertisement
- D. An isolated nonissuer transaction
Show answer and explanation
Answer: D. An isolated nonissuer transaction
An exempt transaction is exempt because of how the sale happens, not because of what is being sold, so read the parties and the manner of sale rather than the security. The standard examples are isolated nonissuer transactions, unsolicited customer orders, sales to institutional buyers, transactions with underwriters, and sales by fiduciaries such as executors, trustees and guardians. General advertising defeats a private offering claim, which is what sinks the newspaper answer. The person claiming an exemption carries the burden of proving it, and the Administrator can revoke an exemption.
9. Which of the following are prohibited business practices for a registered agent?
Select all that apply.
- A. Recommending a security only after reviewing the customer's financial situation and objectives
- B. Guaranteeing a customer against loss in the account
- C. Borrowing money from a retail customer who is not in the business of lending
- D. Declining an order the agent believes is unsuitable and documenting the conversation
- E. Deciding which security to buy and how many shares without prior written authorization from the customer
Show answer and explanation
Answer: B. Guaranteeing a customer against loss in the account, C. Borrowing money from a retail customer who is not in the business of lending, E. Deciding which security to buy and how many shares without prior written authorization from the customer
Sort the prohibited practice list into three reasons and it stops being a memory exercise. A guarantee against loss is misleading, because nobody can deliver it. Borrowing from a client who is not a bank or other lender puts the agent's interest ahead of the client's in a way the client cannot police. Choosing the security and the size without written discretionary authority is acting without authority, and note that discretion over only the time or the price of an order the customer already specified is treated differently. Gathering suitability information and refusing an unsuitable order are what the rules ask for, not violations.
10. Complete the sentence.
The antifraud provisions of the Uniform Securities Act apply to _____.
Options for blank 1: only securities registered in the state, only nonexempt securities sold in nonexempt transactions, every security and every transaction, whether or not registration was required, only accounts held by retail customers
Show answer and explanation
Answer: every security and every transaction, whether or not registration was required
An exemption is always an exemption from registration, never from the ban on fraud. A United States Treasury bond and a private placement both sit outside the registration requirement, and misleading a buyer about either one still violates the Act. That is why it was an exempt transaction is never a defense to a fraud charge, and why the Administrator can pursue fraud even where it had no registration authority in the first place.
11. An agent tells a prospect that a stock must be sound because the state Administrator registered the offering. This statement is:
- A. acceptable, because state registration does involve a review of the offering
- B. acceptable as long as the agent also delivers a prospectus
- C. prohibited, because registration never means the Administrator approved the security or passed on its merits
- D. prohibited only if the investment later loses value
Show answer and explanation
Answer: C. prohibited, because registration never means the Administrator approved the security or passed on its merits
Registering an offering means the required disclosure was filed and cleared, not that any regulator judged the investment. Telling a client or a prospect otherwise is a specifically prohibited representation, and it is prohibited on the day it is said, regardless of how the investment turns out. The same rule covers a person's own registration, so an agent may not suggest that being registered means the Administrator vouched for the agent's ability or integrity.
12. Which of the following may a state securities Administrator do under the Uniform Securities Act?
Select all that apply.
- A. Conduct an investigation outside the borders of the state
- B. Issue a cease and desist order against a person believed to be about to violate the Act
- C. Issue an injunction ordering a person to stop selling securities
- D. Subpoena witnesses and require the production of books and records
- E. Sentence a person who violated the Act to a term in prison
Show answer and explanation
Answer: A. Conduct an investigation outside the borders of the state, B. Issue a cease and desist order against a person believed to be about to violate the Act, D. Subpoena witnesses and require the production of books and records
The Administrator's tools are administrative: orders, investigations, subpoenas, and the power to deny, suspend, revoke or cancel a registration. Investigations are not stopped by the state line, because a violation aimed into the state can be run from anywhere. Injunctions and prison sentences are court remedies, so the Administrator has to go to court and ask for them rather than impose them directly. Administrative order versus court order is the distinction this part of the exam returns to again and again.
13. Under the state brochure rule, an investment adviser that does not deliver its brochure at least 48 hours before entering an advisory contract may instead deliver it when the contract is signed, provided that:
- A. the client is an institutional investor
- B. the Administrator grants a written waiver
- C. the adviser charges no fee for the first month
- D. the client may terminate the contract without penalty within five business days
Show answer and explanation
Answer: D. the client may terminate the contract without penalty within five business days
The rule gives two routes to compliance and both exist for the same reason, which is that the client should get real time to read the disclosure. Either deliver the brochure at least 48 hours before the contract, or deliver it at signing and give the client five business days to walk away without penalty. Federal covered advisers follow the SEC's version of the delivery rule instead of a state's, and that split between state registered and federal covered advisers shows up repeatedly on this exam.
14. Complete the sentence.
A buyer who purchased a security sold in violation of the Act may sue to recover the price paid plus interest, court costs and reasonable attorney fees, less _____.
Options for blank 1: the commission the agent earned on the trade, any income the buyer already received on the security, the current market value of the security, the seller's original cost basis
Show answer and explanation
Answer: any income the buyer already received on the security
The remedy is designed to undo the trade and put the buyer back where they started, not to hand the buyer a profit. So the buyer tenders the security back and recovers what was paid, with interest and costs, minus any dividends or interest already collected on it. A seller who realizes it broke the Act can head off the lawsuit with a written rescission offer, and a buyer who does not accept within the window loses the right to sue. Time limits on these claims are set by each state's adopted statute, so check the one that applies to you.
15. Which statement best describes the standard an investment adviser owes its clients?
- A. A fiduciary duty, which requires the adviser to act in the client's best interest and disclose material conflicts of interest
- B. A suitability standard only, meaning a reasonable basis for each recommendation is enough
- C. No standard at all beyond the antifraud provisions
- D. A duty owed only to clients whose accounts exceed a stated dollar size
Show answer and explanation
Answer: A. A fiduciary duty, which requires the adviser to act in the client's best interest and disclose material conflicts of interest
An investment adviser is a fiduciary, so it puts the client first and discloses material conflicts such as how it is compensated, whether it also earns commissions, and any interest it holds in a security it recommends. Broker-dealer agents were traditionally measured against suitability, a narrower test asking only whether a recommendation fits that customer. Federal Regulation Best Interest has since raised the bar for recommendations made to retail customers, so the gap between the two standards is smaller than older study guides describe.
What the Series 63 exam actually asks
The Series 63 is the Uniform Securities Agent State Law Examination. NASAA, the North American Securities Administrators Association, writes it, and FINRA administers it. The exam has 65 questions, of which 60 are scored and 5 are unscored pretest questions you cannot identify, and you get 75 minutes. You pass by answering at least 43 of the 60 scored questions correctly, which works out to 72 percent. The exam fee and the appointment rules come from FINRA, so check your current candidate materials rather than an old forum post.
The content is state law, not products. NASAA publishes a topic outline, and the two largest blocks are ethical practices and obligations at 25 percent and communication with customers and prospects at 20 percent. Regulation of agents of broker-dealers is 13 percent, regulation of broker-dealers is 12 percent, remedies and administrative provisions is 11 percent, regulation of securities and issuers is 9 percent, and investment advisers and investment adviser representatives take 5 percent each. Together that means about half the exam is conduct and communication, and the rest is definitions and registration.
One thing to be clear about from the start. The Series 63 is a uniform exam built on the model Uniform Securities Act, but the states are the ones that decide who has to hold it, what a waiver looks like, and how their own adopted statute differs from the model. Most states require it to do securities business there, but not all do, and some accept the Series 66 instead. Your state securities regulator and your firm's registration desk are the only reliable source on your own situation, and nothing on this page is legal advice.
How to use this sampler and how to study state law
This exam is definitional in a way that surprises people who come from a product exam like the SIE. Most questions are decided by whether a person or a transaction falls inside a defined term, so a rule of thumb will get you close and then lose you the point. The questions here are written to teach the definitional line itself: what makes someone an agent rather than a broker-dealer, when advice is solely incidental, what turns a gift into a sale, and why an exemption from registration is never an exemption from the antifraud rules.
Take all 15 in one sitting, without notes, then read the explanation for every question including the ones you got right. Treat each miss as a topic rather than a fact. If you missed the broker-dealer exclusion question and the exempt transaction question, that is one signal, not two: you are reading past the qualifying words. Those words are where the exam lives. No place of business in this state, solely incidental, existing customer, isolated, nonissuer, prior written authorization. Underline them as you read.
When you study from your prep book, build two lists and keep them short. One list is definitions, written in your own words with the exclusions attached. The other is prohibited practices, grouped by the reason they are prohibited: misleading the client, putting yourself first, or acting without authority. Almost every ethics question on the exam is one of those three wearing a new outfit.
How StudyPDF builds full practice exams from your own prep material
Fifteen questions can show you which definitions are still fuzzy. They cannot get you ready on their own, and a generic bank often drifts from the emphasis of the prep course you actually paid for.
StudyPDF works from your material instead. Upload the Series 63 prep book you bought, the PDF course packet from your provider, your firm's compliance manual or the notes you took in a licensing class, and Bo, the study agent, builds full-length practice exams from those exact pages. Every question is grounded in your material, and every explanation cites where the answer came from, so when something looks off you can go straight to the page and settle it. Regenerate fresh exams as often as you want, narrow one to a single area such as exempt transactions or administrator remedies, and track which concepts you keep missing. That matters more here than in most subjects, because your state's adopted statute may not match a national prep book word for word.
You do not need to upload anything to start. If your book is a paper copy sitting on the kitchen table, just name a topic instead, for example prohibited business practices or registration by coordination, and Bo writes a practice exam from that. Starting is free.
Written by the StudyPDF team. Last updated 2026-08-19.