Introduction to the Series 23 Exam
The financial services industry is governed by a complex web of regulations designed to protect investors and maintain market integrity. For professionals looking to ascend into senior leadership and supervisory roles, obtaining the right certifications is a non-negotiable step. One such specialized certification is the Series 23, formally known as the General Securities Principal Qualification Examination — Sales Supervisor Module. This exam serves as a “bridge” for individuals who have already demonstrated competency in sales supervision and wish to upgrade their registration to a General Securities Principal.
Unlike the broader Series 24 exam, the Series 23 is tailored specifically for those who already hold the Series 9 and Series 10 (General Securities Sales Supervisor) designations. It focuses on the additional regulatory knowledge required to oversee a firm’s entire general securities business, including investment banking, research, and trading operations. Our team at Fraser Exam has compiled the most effective strategies to help you navigate this challenging assessment and advance your career in financial management.
Section 1: The Basics & Eligibility
What is the Series 23?
The Series 23 is a FINRA-administered exam that qualifies an individual to function as a General Securities Principal. This role involves the management and supervision of a member firm’s investment banking or securities business. Because the candidate has already proven their knowledge of sales supervision through the Series 9/10, the Series 23 focuses on the “missing pieces” required for full principal status, such as market making, underwriting, and financial responsibility rules.
Eligibility and Prerequisites
Not everyone can sit for the Series 23. It is a specialized module with strict prerequisites. To be eligible, a candidate must:
- Be sponsored by a FINRA member firm.
- Already hold the Series 7 (General Securities Representative) registration.
- Already hold the Series 9 and Series 10 (General Securities Sales Supervisor) registrations.
If you do not have the Series 9/10, you must take the more comprehensive Series 24 exam instead. The Series 23 is essentially a shortcut for sales supervisors to reach the same level of authority as a Series 24 holder.
Exam Costs and Validity
As of the current fee schedule, the cost to take the Series 23 exam is $100. This fee is typically paid by the sponsoring firm, though candidates should verify this with their compliance department. In terms of international validity, the Series 23 is a U.S.-specific certification governed by FINRA. While the knowledge of capital markets is universally applicable, the legal authority to supervise securities business granted by this exam is limited to firms operating within the United States regulatory framework.
| Exam Detail | Information |
|---|---|
| Administering Body | FINRA |
| Exam Cost | $100 |
| Prerequisites | Series 7 AND Series 9/10 |
| Passing Score | 70% |
| Number of Questions | 100 Scored (plus 5 unscored) |
Section 2: Exam Format & Style
The Series 23 is a computer-based, closed-book examination. It consists of 100 multiple-choice questions. In addition to the 100 scored questions, there are 5 “pretest” questions randomly distributed throughout the exam that do not count toward your final score. These are used by FINRA to evaluate the validity of new questions for future exams.
Duration and Timing
Candidates are allotted 2 hours and 30 minutes (150 minutes) to complete the exam. This averages out to 1.5 minutes per question, which is generally sufficient for most candidates, provided they have a firm grasp of the material. There is no penalty for guessing (no negative marking), so it is in your best interest to answer every question.
Scoring Mechanism
The exam is scored on a percentage basis. To pass, you must achieve a score of 70% or higher. This means you must answer at least 70 out of the 100 scored questions correctly. Upon completion of the exam at a testing center, you will receive your results immediately on the screen, followed by a printed score report.
Section 3: Difficulty & Passing Rates
The Series 23 is widely considered a difficult exam, despite its shorter length compared to the Series 24. Because it focuses heavily on technical areas like the Net Capital Rule (SEC Rule 15c3-1) and the Customer Protection Rule (SEC Rule 15c3-3), candidates often find the material more “dry” and mathematically dense than the sales-oriented Series 9/10.
Historical Passing Rates
While FINRA does not officially publish passing rates for specific exams, industry estimates suggest that the first-time pass rate for the Series 23 is between 60% and 70%. Many candidates underestimate the exam because they have already passed the Series 9/10, but the Series 23 requires a shift in mindset from supervising retail sales to supervising firm-wide operations and regulatory compliance.
Commonly Challenging Sections
According to feedback from Fraser Exam users, the most difficult sections typically involve:
- Net Capital Requirements: Calculating aggregate indebtedness and understanding the impact of haircuts on firm capital.
- Market Making: Understanding the rules surrounding Nasdaq trading, including the limit order display rule and Manning rule.
- Underwriting: Navigating the complexities of the Securities Act of 1933 and Regulation M.
Section 4: Preparation Strategy
Success on the Series 23 requires a disciplined study plan. Because you are likely working full-time in a supervisory capacity, time management is critical. We recommend a study window of 4 to 6 weeks, dedicating approximately 60 to 80 hours of total study time.
Recommended Study Timeline
| Timeline | Focus Area |
|---|---|
| Weeks 1-2 | Read the primary textbook and take notes on Net Capital and Market Making. |
| Week 3 | Focus on Underwriting, Research, and Operations. Start taking unit quizzes. |
| Week 4 | Take full-length practice exams. Review all incorrect answers thoroughly. |
| Final 3 Days | Review “cheat sheets” for formulas and timeframes. Take one final mock exam. |
Self-Study vs. Prep Courses
While self-study is possible, many candidates opt for a structured prep course to help condense the massive amount of regulatory information. Fraser Exam offers comprehensive study materials tailored for this exam, which can help you focus on the highest-probability topics and avoid getting bogged down in minor details that are rarely tested.
When preparing, ensure you are using the official FINRA Series 23 content outline to guide your studies. This document provides a granular breakdown of every topic that could potentially appear on the exam.
Section 5: Career & ROI
Passing the Series 23 is a significant career milestone. It grants you the same supervisory authority as the Series 24, allowing you to hold the title of General Securities Principal. This opens doors to high-level management positions within broker-dealers, investment banks, and compliance departments.
Job Roles and Salary Potential
Common job titles for Series 23 holders include:
- Chief Compliance Officer (CCO)
- Head of Trading
- Investment Banking Principal
- Director of Operations
- Branch Manager (with expanded authority)
- 1st Failure: 30-day wait.
- 2nd Failure: 30-day wait.
- 3rd Failure: 180-day (6-month) wait.
The ROI of this certification is often seen in both base salary increases and bonus eligibility. Principals in the financial industry often see a salary increase of 15% to 30% compared to supervisor-level roles, with total compensation for experienced principals frequently exceeding $150,000 to $250,000 depending on the firm’s size and location.
Renewal and Expiration
Once you pass the Series 23, your registration will remain valid as long as you are employed by a FINRA member firm and complete the required Continuing Education (CE) modules. If you leave the industry, your registration will typically expire after two years, though recent FINRA rule changes (MQP) may allow for an extension under specific conditions.
Section 6: Exam Day Logistics
The Series 23 is administered at Prometric testing centers across the country. Proper preparation for the logistics of the day is just as important as knowing the material.
What to Bring
You must bring a valid, government-issued photo ID (such as a driver’s license or passport). The name on your ID must match the name on your exam registration exactly. You are not allowed to bring any personal items into the testing room, including phones, watches, or your own calculator.
Testing Environment
The testing center will provide you with a basic four-function calculator and either a whiteboard or scratch paper with a pen/pencil. You will be monitored via camera and in-person proctors throughout the duration of the exam. If you need a bathroom break, the clock will continue to run, so use your time wisely.
Retake Policy
If you do not pass the Series 23 on your first attempt, FINRA imposes a waiting period before you can try again:
Many candidates who’ve used Fraser Exam resources report feeling more confident on exam day, significantly reducing the likelihood of needing a retake.
Comprehensive FAQ Section
Is online/remote proctoring available for the Series 23?
Currently, FINRA offers limited remote proctoring for certain exams under specific circumstances, but most candidates are required to take the Series 23 in person at a Prometric testing center. Check the FINRA remote proctoring page for the most up-to-date availability.
How do I schedule my exam date?
Once your firm files a Form U4 and pays the fee, a 120-day enrollment window opens. You can then schedule your appointment through the Prometric website or by calling their registration line.
What is the cancellation or rescheduling policy?
You can reschedule or cancel your exam, but fees apply if you do so within a certain timeframe. Generally, there is no fee if you change your appointment at least 10 business days in advance. Fees apply for changes made 3 to 10 days before the exam, and the full fee is forfeited if you cancel within 2 business days.
Am I allowed to bring a calculator?
No. You are not permitted to bring your own calculator. The testing center will provide one for you, or a digital calculator will be available on the computer screen during the exam.
Are bathroom breaks allowed during the exam?
Yes, you can take a break, but the exam timer will not stop. You must follow the testing center’s check-out and check-in procedures, which usually involves a security scan.
What items are strictly prohibited in the testing room?
Prohibited items include cell phones, smartwatches, hats, bags, study materials, and food/drinks. Most centers provide lockers for your personal belongings.
How early should I arrive at the testing center?
It is recommended to arrive at least 30 minutes before your scheduled appointment to complete the check-in process and security screening.
What is the passing score?
The passing score for the Series 23 is 70%.
Do I get my results immediately?
Yes. As soon as you submit the exam, your unofficial score will appear on the screen. You will also receive a printed copy of your performance report before you leave the center.
Will I receive a breakdown of my score?
If you pass, you will only see your score. If you fail, you will receive a detailed breakdown showing your performance in each of the major content areas, which is invaluable for focusing your studies for a retake.
Does this certification expire?
The registration remains active as long as you are employed by a member firm. If you leave the industry, it typically expires after two years of inactivity.
Are accommodations available for candidates with disabilities?
Yes, FINRA provides reasonable accommodations for candidates with documented disabilities. You must apply for these accommodations through FINRA before scheduling your exam.
Is the exam available in languages other than English?
The Series 23 is currently only offered in English. However, candidates with limited English proficiency may apply for additional testing time.
Can I use scratch paper?
The testing center will provide either scratch paper or a dry-erase whiteboard. These must be returned to the proctor at the end of the session.
How many hours should I study?
Most successful candidates spend between 60 and 80 hours preparing, depending on their existing knowledge of firm operations and net capital rules.
Conclusion
The Series 23 exam is a rigorous but rewarding challenge for financial professionals. By successfully bridging the gap between sales supervision and general principal status, you position yourself as a vital asset to your firm’s leadership team. While the technical nature of the material—particularly the financial responsibility rules—can be daunting, a structured approach to studying will yield results.
Success on this exam is not just about memorizing rules; it is about understanding the regulatory philosophy that keeps the financial markets functioning. Here at Fraser Exam, we recommend starting your preparation at least 3 months in advance if you have a particularly demanding work schedule. With the right resources, a consistent study habit, and a clear understanding of the exam’s format, you can confidently earn your General Securities Principal designation and take the next major step in your professional journey. Good luck!