The FINRA Securities Industry Essentials (SIE) exam gives you 1 hour and 45 minutes to answer 75 scored multiple-choice questions (plus 10 unscored experimental items), requiring a 70% passing score (53/75).
Per VoraPrep's SIE analysis, passing the FINRA SIE exam on your first attempt comes down to five high-yield visuals and rules: the Bond Yield Seesaw (Price ↑ = Yield ↓), the 4-Quadrant Options Breakeven & Max Gain/Loss Matrix, T+1 Settlement & Ex-Dividend Date Rules (2024+ SEC standard), SIPC ($500k total / $250k cash) vs. FDIC ($250k) Coverage, and FINRA Conduct Rules (Gifts $100 limit, Outside Business Activities, U4/U5 30-day filing). Practice with VoraPrep's 2,595+ FINRA SIE practice questions.
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Key facts
- Official Governing Authority
- FINRA (Financial Industry Regulatory Authority) & Prometric
- Exam Format
- 75 scored MCQs (+ 10 experimental = 85 total), 1 hour 45 minutes (105 minutes)
- Passing Score
- 70%
- 4 Official FINRA SIE Sections
- VoraPrep SIE Coverage
- 60 interactive lessons, 2,595+ FINRA MCQs, 303 FSRS flashcards ($19/mo or $149/yr)
1. The 4-Quadrant Options Matrix (Calls & Puts)
| Position | Market Bias | Breakeven Formula | Maximum Gain | Maximum Loss |
|---|---|---|---|---|
| Long Call (Buy Call) | Bullish | Strike + Premium | Unlimited | Premium Paid |
| Short Call (Write Naked Call) | Bearish / Neutral | Strike + Premium | Premium Received | Unlimited (highest risk!) |
| Long Put (Buy Put) | Bearish | Strike − Premium | Strike − Premium (stock goes to $0) | Premium Paid |
| Short Put (Write Put) | Bullish / Neutral | Strike − Premium | Premium Received | Strike − Premium (stock goes to $0) |
Mnemonic for Options Breakeven: CAL (Call: Add to Lower/Strike) and PSL (Put: Subtract from Lower/Strike) — whether you are Long or Short, Calls are alwaysStrike + Premiumand Puts are alwaysStrike − Premium!
2. Bond Formulas, Settlement & Regulatory Numbers
| Topic | Exact Rule / Formula | SIE Exam Trap |
|---|---|---|
| Current Yield (CY) | Annual Coupon Interest ($) ÷ Current Market Price ($) | If a 6% bond ($1,000 par = $60/yr) trades at 90 ($900), CY = $60 ÷ $900 = 6.67% |
| Conversion Ratio & Parity | Conversion Ratio = Par ($1,000) ÷ Conversion Price; Stock Parity = Bond Market Price ÷ Conversion Ratio | A $1,000 bond convertible at $25 converts into 40 shares of common stock |
| Order Types (SLoBS over BLiSS) | Above current market: Buy Stop / Sell Limit (SLoBS). Below current market: Buy Limit / Sell Stop (BLiSS). | Stop orders become market orders once triggered (guarantees execution, not price); Limit orders guarantee price or better, not execution |
| Regular-Way Settlement & Ex-Date | T+1 (1 business day after trade date) for equities, corporates, munis, and Treasuries. Ex-Date = Record Date under T+1. | Reg T payment deadline is T+3 (S+2: 2 business days after settlement) |
| FINRA Gift Limit (Rule 3220) | $100 per person per year for business-related gifts to employees of another member firm | Promotional items of nominal value (pens, hats) and business meals attended together are exempt from the $100 cap |
| Form U4 / U5 & Fingerprinting | Form U5 filed within 30 days of termination; statutory disqualification spans 10 years (any felony or securities/money misdemeanor) | All registered reps and back-office personnel handling securities/cash/books must be fingerprinted |
| Currency Transaction Report (CTR) vs. SAR | CTR (FinCEN): Cash transactions exceeding $10,000 in a single day (file within 15 days). SAR: Suspicious activity involving ≥$5,000 (file within 30 days; never notify the customer!). | Structuring cash deposits under $10,000 to evade a CTR is a federal crime and requires a SAR |