165+ Free Series 26 Practice Questions

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Question 1

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A broker-dealer wishes to hire a new registered representative who previously worked at another member firm. Which form must be filed to register this individual with FINRA?

Form U5

Form U4

Form BD

Form ADV

to track

2026 Statistics

Key Facts: Series 26 Exam

65-70%

First-Time Pass Rate

Industry estimate

70%

Passing Score

77/110 questions

50-70 hrs

Study Time

Recommended

40%

Supervision Focus

Largest section

$100

Exam Fee

FINRA

2h 45m

Exam Duration

FINRA

The Series 26 exam has an estimated 65-70% first-time pass rate. It requires 70% (77/110 questions) to pass. The exam focuses on four functions: Personnel Management and Registration (30%), Supervision of Sales (40%), Sales Practices (15%), and Business Processing/Recordkeeping (15%). Plan for 50-70 hours of study over 4-6 weeks.

Sample Series 26 Practice Questions

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1A broker-dealer wishes to hire a new registered representative who previously worked at another member firm. Which form must be filed to register this individual with FINRA?

A.Form U5

B.Form U4

C.Form BD

D.Form ADV

Explanation: Form U4 (Uniform Application for Securities Industry Registration or Transfer) is used to register an associated person with FINRA and transfer their registration between firms. Form U5 is used to terminate registration, Form BD is for broker-dealer registration, and Form ADV is for investment adviser registration. The hiring firm must file the U4 through CRD within 30 days of employment.

2A registered representative is leaving a member firm to join a competitor. According to FINRA rules, how long does the former firm have to file a Form U5 after the representative's termination?

A.10 business days

B.15 business days

C.30 calendar days

D.30 business days

Explanation: FINRA Rule 1010 requires that Form U5 (Uniform Termination Notice for Securities Industry Registration) be filed within 30 calendar days of the termination of an associated person's employment. The form must accurately report the reason for termination and disclose any internal investigations or regulatory actions. Failing to file on time can result in disciplinary action against the firm.

3Under FINRA Rule 3110, a principal is reviewing a registered representative's background and discovers a prior criminal conviction for securities fraud that was not disclosed on Form U4. What is the principal's responsibility?

A.Ignore it since the representative has already been hired

B.Report the undisclosed disciplinary history to FINRA and consider heightened supervision

C.Terminate the representative immediately without investigation

D.Wait until the next annual compliance meeting to address the issue

Explanation: FINRA Rule 3110 requires principals to supervise associated persons and ensure compliance with registration requirements. If a principal discovers undisclosed disciplinary history, they must report it to FINRA through an amended filing and must consider implementing heightened supervision. Rule 3110.09 specifically addresses requirements for supervising persons with disciplinary histories. Immediate termination without investigation may not always be required, but the matter must be addressed promptly.

4Which of the following individuals would be considered an "associated person" under FINRA rules and therefore require registration?

A.A clerical employee who only files paperwork and does not discuss securities with clients

B.A receptionist who answers phones and schedules appointments

C.A sales assistant who recommends mutual funds to clients and accepts orders

D.A janitorial contractor who cleans the office after hours

Explanation: An "associated person" under FINRA rules includes any natural person who is engaged in the investment banking or securities business of a member, including sales assistants who recommend securities, accept orders, or perform other securities-related functions. Clerical and ministerial personnel who do not engage in securities activities, receptionists performing purely administrative duties, and independent contractors like janitors are generally excluded from the definition of associated person and do not require registration.

5A broker-dealer is opening a new branch office. Under FINRA Rule 3110.07, what action must the firm take?

A.File Form BR within 10 business days of opening

B.File Form BR within 30 calendar days of opening

C.No filing is required for branch offices

D.Notify the SEC only, not FINRA

Explanation: FINRA Rule 3110.07 requires member firms to file Form BR (Branch Office Registration) within 30 calendar days of opening a branch office. The form must be filed through the Central Registration Depository (CRD) system. Failure to register branch offices can result in disciplinary sanctions. The form establishes the location as an approved office where securities business may be conducted.

6What is the primary purpose of the pre-hire background check requirements under FINRA regulations?

A.To verify the applicant's college degree

B.To identify any disciplinary history, complaints, or financial problems that may affect fitness for registration

C.To determine the applicant's credit score for employment purposes

D.To assess the applicant's investment performance at previous firms

Explanation: FINRA requires firms to conduct pre-hire background checks to identify any disciplinary history, customer complaints, bankruptcy filings, criminal records, or other factors that might affect the applicant's fitness for registration. This helps firms make informed hiring decisions and fulfill their supervisory obligations under Rule 3110. The background check is not primarily focused on credit scores (though financial responsibility is a factor) or investment performance, but rather on regulatory and compliance history.

7Under FINRA Rule 1230, which of the following persons is EXEMPT from registration as a registered representative?

A.An individual who sells mutual funds to retail customers

B.A person whose duties are exclusively clerical or ministerial

C.An employee who provides investment advice for compensation

D.A principal who supervises the sale of variable annuities

Explanation: FINRA Rule 1230 provides exemptions from registration for persons whose duties are exclusively clerical or ministerial. This includes employees who perform administrative functions without engaging in securities sales or recommendations. Individuals who sell mutual funds, provide investment advice for compensation, or supervise securities sales all require appropriate registration. The exemption is narrow and applies only to those with purely administrative, non-securities functions.

8A Series 26 principal is reviewing registration requirements for the firm's main office. According to FINRA Rule 3110.01, what must be properly designated and registered?

A.Only the CEO's office

B.The main office and any Office of Supervisory Jurisdiction (OSJ)

C.Only offices where more than 10 registered representatives work

D.Offices are not required to be registered with FINRA

Explanation: FINRA Rule 3110.01 requires member firms to register their main office and any Office of Supervisory Jurisdiction (OSJ) with FINRA. An OSJ is a location where supervisory personnel are assigned and from which supervisory activities are conducted. The rule ensures that FINRA knows where supervisory functions are being performed and can properly examine the firm's supervisory systems.

9A registered representative files for personal bankruptcy. What is the firm's obligation under FINRA rules?

A.No action is required unless the representative is terminated

B.The firm must file an amendment to Form U4 within 30 days of learning of the bankruptcy

C.The firm must immediately suspend the representative's registration

D.The firm only needs to note it in internal records

Explanation: Under FINRA rules, a bankruptcy filing by a registered person is a reportable event that must be disclosed on Form U4. The firm must file an amendment to the representative's Form U4 within 30 days of learning of the bankruptcy. This disclosure is important because financial difficulties may indicate potential risk factors for future misconduct. The filing requirement does not automatically result in suspension but ensures that regulators and the public have access to this information through FINRA BrokerCheck.

10What is the purpose of the Central Registration Depository (CRD) system?

A.To store physical securities certificates

B.To serve as a centralized database for registration and disciplinary history of broker-dealers and associated persons

C.To process customer securities trades

D.To calculate commissions for registered representatives

Explanation: The Central Registration Depository (CRD) is FINRA's computerized system that serves as a centralized database for the registration and licensing of broker-dealers and their associated persons. It stores information about employment history, examination results, disciplinary actions, and disclosure events. This information is used to populate FINRA BrokerCheck, which allows investors to research the professional backgrounds of brokers and firms. The CRD does not store physical securities, process trades, or calculate commissions.

About the Series 26 Exam

The Series 26 exam qualifies principals to supervise the sale of investment company products (mutual funds) and variable contracts (variable annuities and variable life insurance) at broker-dealers. It is a limited principal registration that focuses specifically on packaged products.

Questions

110 scored questions

Time Limit

2 hours 45 minutes

Passing Score

70%

Exam Fee

$100 (FINRA)

Series 26 Exam Content Outline

30%

Personnel Management Activities and Registration

Form U4/U5 filings, CRD system, registration requirements, continuing education, background checks, and branch office registration

40%

Supervision of Sales

Written supervisory procedures, Rule 3110, account reviews, correspondence supervision, outside business activities, and suitability oversight

15%

Sales Practices

Communications with the public, mutual fund sales, variable annuity suitability, breakpoint disclosure, and sales charge limitations

15%

Business Processing and Recordkeeping

Record retention requirements, confirmations, customer complaints, AML/CIP procedures, and account transfers

How to Pass the Series 26 Exam

What You Need to Know

Passing score: 70%
Exam length: 110 questions
Time limit: 2 hours 45 minutes
Exam fee: $100

Keys to Passing

Complete 500+ practice questions
Score 80%+ consistently before scheduling
Focus on highest-weighted sections
Use our AI tutor for tough concepts

Series 26 Study Tips from Top Performers

1Master FINRA Rule 3110 (Supervision) - this is the largest section (40%) of the exam

2Understand Forms U4 and U5 - know filing requirements and disclosure obligations

3Study written supervisory procedures and account review requirements

4Know mutual fund sales charge breakpoints and disclosure requirements

5Understand variable annuity suitability and exchange requirements under Rule 2330

6Review record retention periods under SEC Rule 17a-4 and FINRA rules

Frequently Asked Questions

What does the Series 26 license allow me to do?

The Series 26 license qualifies you to supervise the sale of investment company products (mutual funds, closed-end funds, UITs) and variable contracts (variable annuities and variable life insurance) at a broker-dealer. It is a limited principal registration focused specifically on these packaged products. It does not authorize supervision of general securities like stocks and bonds (which requires Series 24).

What is the Series 26 exam pass rate?

The Series 26 exam has an estimated pass rate of 65-70% for first-time test-takers. With focused study on supervisory responsibilities and FINRA rules, you can improve your chances of passing on the first attempt.

What are the prerequisites for the Series 26?

To hold a Series 26 registration, you must first pass the SIE exam and either the Series 6 (Investment Company Products Representative) or Series 7 (General Securities Representative) exam. The Series 26 is a principal-level qualification that builds upon the knowledge tested in these representative-level exams.

How many questions are on the Series 26 exam?

The Series 26 exam contains 110 scored multiple-choice questions plus 10 unscored pretest questions, for a total of 120 questions. You have 2 hours and 45 minutes to complete the exam, and you need 70% (77 correct answers) to pass.

How long should I study for the Series 26?

Plan for 50-70 hours of study over 4-6 weeks. Focus heavily on supervisory responsibilities under FINRA Rule 3110, which accounts for 40% of the exam. Understand personnel management requirements, registration procedures, and sales practice supervision.

What topics are covered on the Series 26 exam?

The Series 26 exam covers four main functions: 1) Personnel Management and Registration (30%) - Forms U4/U5, CRD, background checks; 2) Supervision of Sales (40%) - Written supervisory procedures, account reviews, correspondence; 3) Sales Practices (15%) - Communications, suitability, breakpoints; 4) Business Processing (15%) - Recordkeeping, AML, complaints.