SIE Exam Study Guide

Sources: FINRA SIE Content Outline (2025), FINRA SIE and Exam Restructuring FAQ, FINRA investor education pages, SEC Investor.gov glossary, FINRA and SEC rule texts linked in each section. Checked October 24, 2026, unless a section says otherwise.

Study the official outline

FINRA's content outline is the official list of what the SIE tests, so study it section by section in the order below. The exam has 75 scored multiple-choice questions split across four sections. Section 2 carries 33 of the 75, so give it the most time.

From FINRA's outline: "The exam consists of 75 multiple-choice items, and each item consists of four answer choices." FINRA, SIE Content Outline.

Each exam also includes 5 unscored pretest items, so you answer 80 in total within 1 hour and 45 minutes. The outline states there is no penalty for guessing, so answer every question. The passing score is 70 on a scale of 0 to 100 (FINRA SIE FAQ).

Use this route for each subtopic:

1. Read the "What to know" cell and say the idea back in your own words.
2. Read the common confusion and explain the difference between the two ideas.
3. Answer the sample questions for the section, then drill the section in the practice test.
4. Mark any subtopic you missed and come back to it before moving to the next section.

Section 1: Knowledge of Capital Markets (16%, 12 questions)

Section 1 covers who regulates the markets, how markets are structured, how the economy affects securities, and how new securities are offered. Start here, because the regulators and market participants named in this section come up again in the later sections.

Sources for Section 1: SEC role, laws that govern the securities industry, About FINRA, market participants, SIPC, FDIC, SEC broker-dealer guide, 17 CFR 230.501, OCC, DTCC, Federal Reserve monetary policy FAQ, SEC guide to financial statements, IMF on Keynesian economics, IMF on monetarism, BEA GDP, BEA GNP, Regulation D offerings, 17 CFR 230.415.

Drill Section 1 in the SIE practice test once both sample questions make sense.

Section 2: Understanding Products and Their Risks (44%, 33 questions)

Section 2 covers equity, debt, options, funds, 529 and ABLE plans, DPPs, REITs, hedge funds, exchange-traded products and investment risk. It is the largest section, and most of the calculations further down this page come from it.

The options subtopic has its own question set. Work through the rights and obligations of each side, then practice SIE options questions with explanations.

Sources for Section 2: Investor.gov stocks, ADRs, FINRA corporate actions, FINRA bonds, TreasuryDirect, Investor.gov municipal bonds, FINRA options, FINRA mutual funds, FINRA breakpoints, FINRA closed-end funds, IRS 529 Q&A, IRS ABLE accounts, FINRA Rule 2310, Investor.gov REITs, Investor.gov hedge funds, FINRA ETFs and ETNs, Investor.gov risk.

Drill Section 2 in the SIE practice test, then work the calculations further down this page.

Section 3: Understanding Trading, Customer Accounts and Prohibited Activities (31%, 23 questions)

Section 3 covers orders, returns, settlement, corporate actions, account types and registrations, anti-money laundering, records, communications and prohibited conduct.

Sources for Section 3: Investor.gov orders glossary, ex-dividend dates, basis point, FINRA settlement cycles, SEC T+1 release, stock split, FINRA brokerage accounts, FINRA Rule 3260, IRS 2026 limits, IRS RMDs, IRS Roth IRAs, FinCEN, 31 CFR 1010.311, 31 CFR 1023.320, FINRA Rule 3310, OFAC SDN FAQ, FINRA Rule 2231, 17 CFR 240.17a-4, FINRA Rule 4370, Regulation S-P, Regulation Best Interest, Form CRS guide, FINRA Rule 5270, insider trading, FINRA Rule 2150, FINRA Rule 3240, FINRA Rule 2165.

Drill Section 3 in the SIE practice test, and pay attention to which account or rule each scenario points to.

Section 4: Overview of the Regulatory Framework (9%, 7 questions)

Section 4 covers registration, continuing education, Forms U4 and U5, and the outside activities and events a representative must report. It is the smallest section, and its subtopics center on filings, notices and deadlines.

Sources for Section 4: FINRA Rule 1210, FINRA Rule 1230, FINRA Rule 1240, FINRA SIE FAQ, Form U4, FINRA By-Laws Article V, Form U5, FINRA Rule 1122, FINRA Rule 3270, FINRA Rule 3280, Regulatory Notice 26-05, MSRB Rule G-37.

Drill Section 4 in the SIE practice test. When all four sections are done, take the timed full exam.

Take the timed SIE practice exam

Choose useful free materials

Free SIE materials include FINRA's content outline, FINRA's practice test, the official investor pages behind each concept, and original practice questions. FINRA itself points candidates to the outline.

From FINRA's FAQ: "The content outline is available on FINRA.org. While FINRA does not endorse the materials created by any particular vendor, a number of test providers have created materials." FINRA, SIE and Exam Restructuring FAQ.

Pick each material for the job it does:

Flashcards test whether you can retrieve a fact from memory. Explanations teach why it is true. Use the guide first for a new subtopic, then flashcards to keep it.

From FINRA's practice test page: "Answer 75 multiple-choice questions that are similar to those you might find on the SIE exam." FINRA, Practice Test for the SIE.

FINRA notes that its practice test is not timed, and that your score on it is not an absolute prediction of your SIE result.

Concise rule and formula review

This review sheet lists the numbers and formulas the SIE outline expects you to apply, each with its official source. You cannot take it into the exam.

From FINRA's outline: "Candidates are not permitted to bring reference materials to their testing session." FINRA, SIE Content Outline.

Use the sheet for a last review the day before, and test yourself on each row by covering the value column.

Two rules changed in 2026, so older study material may show the earlier figure. FINRA raised the gift limit from $100 to $300, effective March 30, 2026. FINRA's intraday margin standards replace the pattern day trader $25,000 minimum equity rule.

From FINRA Regulatory Notice 26-10: "Effective Date: June 4, 2026; Phase-in Period: Ends October 20, 2027". FINRA, Regulatory Notice 26-10.

The formulas, each worked step by step in the sections below:

Solve SIE calculations with units and steps

SIE math uses a handful of formulas, and each one depends on the right denominator. Every calculation below names its denominator, works one original example with units, checks the answer a second way, and shows the wrong method that produces a tempting answer.

At a test center, FINRA provides the calculator.

From FINRA's test center page: you are provided "four-function calculator, erasable note boards, dry-erase markers". FINRA, Prepare for Your Test Center Appointment.

Use the same habits on every calculation:

1. Write the units next to each number (dollars, shares, percent).
2. Name the denominator before you divide.
3. Check the answer with a second method or by working backward.
4. Ask whether the answer is sensible, for example whether a discount bond's current yield is above its coupon rate.

Current yield

Current yield is the bond's annual interest in dollars divided by its current market price. When the price changes, the current yield changes with it.

From FINRA: "Current yield is the yearly coupon payment divided by the bond's price, stated as a percent." FINRA, Bonds.

Bond prices are quoted as a percentage of par. FINRA's example: a bond quoted at 105 trades at 105% of par, or $1,050.

Worked example. A $1,000 par bond pays a 4% coupon and is quoted at 80.

1. Annual interest: $1,000 x 0.04 = $40 a year.
2. Market price: 80% of $1,000 = $800.
3. Current yield: $40 / $800 = 0.05 = 5.00%.

Check. 5% of $800 is $40, the annual interest. The bond trades below par, so its current yield (5.00%) is above its coupon rate (4%).

Wrong method. Dividing $40 by the $1,000 par value gives 4%. That is the coupon rate, also called the nominal yield.

Coupon, price and yield relationships

A bond's price and its yield move in opposite directions. When market interest rates rise, the price of an existing bond falls until its yield matches the market.

From FINRA: "Price and yield are inversely related: As the price of a bond goes up, its yield goes down, and vice versa." FINRA, Understanding Bond Yield and Return.

FINRA's own example uses a $1,000 bond with a 6% coupon bought at face value. If a comparable new bond later pays 7%, you "might need to offer it at a price below face value because investors would now expect to be making a 7 percent return" (FINRA, Brush Up on Bonds).

Yield to maturity is the overall rate earned by buying at the market price and holding to maturity, counting both the coupons and the repayment of par. Yield to call uses the call date and call price instead. The coupon never changes, so only the price and the yields move.

Worked example. A $1,000 par bond with a 5% coupon pays $50 a year. At $1,250 (a premium), current yield is $50 / $1,250 = 4.00%. The bond repays only $1,000 at maturity, so the $250 premium is lost and the yield to maturity is below 4.00%.

Check. Premium bond: coupon rate (5%) is above current yield (4%), which is above yield to maturity. The order runs the other way for a discount bond.

Wrong method. Saying the coupon rate falls when the price rises. The coupon is fixed at issuance and tied to par.

Tax-equivalent yield

The tax-equivalent yield is the taxable yield that leaves you with the same after-tax income as a tax-exempt bond: divide the tax-exempt yield by (1 - your tax rate). The question gives you the tax rate as an assumption. You do not need to memorize a tax bracket.

From FINRA: municipal bonds "are typically exempt from federal taxation and, for investors who reside in the state where the bond is issued, from state and local taxes, too." FINRA, Bonds.

Worked example. A municipal bond yields 3.00%, its interest is exempt from federal income tax, and you assume a 25% federal tax rate with no state tax.

1. Keep share after tax: 1 - 0.25 = 0.75.
2. Tax-equivalent yield: 3.00% / 0.75 = 4.00%.

Check. A taxable bond yielding 4.00% loses 25% to tax: 4.00% x 0.75 = 3.00% after tax, the same as the municipal bond.

Wrong methods. Multiplying 3.00% by 0.75 gives 2.25%. That taxes income that is already exempt. Multiplying by 1.25 gives 3.75%, which is too low because the tax comes out of the taxable yield.

Conversion ratio, conversion value and parity

The conversion ratio is the number of shares one convertible bond buys: par value divided by the conversion price. Conversion value and parity both build on that ratio.

From FINRA: "A convertible bond is a bond with the option to convert into shares of common stock of the same issuer at a pre-established price." FINRA, Bonds.

Worked example. A $1,000 par convertible bond has a conversion price of $50 per share. The stock trades at $56 and the bond trades at $1,080.

1. Conversion ratio: $1,000 / $50 = 20 shares per bond.
2. Conversion value: 20 shares x $56 = $1,120.
3. Parity price of the stock: $1,080 / 20 shares = $54 per share.

Check. At $54 a share, 20 shares are worth 20 x $54 = $1,080, the bond's market price. The stock now trades at $56, above parity, so converting gives shares worth $1,120 against a bond worth $1,080.

Wrong methods. Dividing par by the stock price ($1,000 / $56) mixes up the conversion price with the market price. Dividing par instead of the bond's market price by the ratio ($1,000 / 20 = $50) returns the conversion price, which differs from parity.

NAV, offering price and load denominators

Net asset value (NAV) per share is a fund's total assets minus total liabilities, divided by the shares outstanding. The public offering price (POP) adds the front-end sales charge, which is stated as a percentage of the POP.

From Investor.gov: NAV is "the company's total assets minus its total liabilities." SEC, Net Asset Value.

From FINRA Rule 2341: "A 'front-end sales charge' is a sales charge that is included in the public offering price of the shares of an investment company." FINRA, Rule 2341.

Worked example. A fund holds $66 million in assets and owes $6 million, with 4 million shares outstanding. A second fund has a NAV of $14.10 and a 6% front-end sales charge.

1. First fund NAV: ($66,000,000 - $6,000,000) / 4,000,000 shares = $15.00 per share.
2. Second fund: NAV is 94% of the POP, because the charge is 6% of the POP.
3. POP: $14.10 / (1 - 0.06) = $14.10 / 0.94 = $15.00.

Check. 6% of $15.00 is $0.90, and $15.00 - $0.90 = $14.10, the NAV.

Wrong method. $14.10 x 1.06 = $14.95. That treats the charge as a percentage of NAV, so the POP comes out too low.

Sales charge percentage and invested dollars

The sales charge percentage is the dollar charge divided by the public offering price. The money left after the charge buys shares at NAV.

FINRA Rule 2341 caps aggregate front-end and deferred sales charges at 8.5% of the offering price for funds without an asset-based sales charge.

Worked example. A fund's POP is $15.00 and its NAV is $14.10. You invest $6,000.

1. Charge per share: $15.00 - $14.10 = $0.90.
2. Sales charge %: $0.90 / $15.00 = 0.06 = 6%.
3. Charge on your purchase: $6,000 x 0.06 = $360.
4. Invested at NAV: $6,000 - $360 = $5,640.
5. Shares bought: $5,640 / $14.10 = 400 shares.

Check. $6,000 / $15.00 POP = 400 shares, the same count.

Wrong method. $0.90 / $14.10 = 6.38%. That divides by NAV, and the rule states the charge as a percentage of the offering price.

Breakpoints lower the percentage at larger purchase amounts. Under one of Rule 2341's rights-of-accumulation schedules, the maximum aggregate charge is 7.75% on purchases of $10,000 or more and 6.25% on purchases of $25,000 or more.

Initial margin versus maintenance and equity

Initial margin is the 50% deposit Regulation T requires on a new margin purchase. Maintenance margin is the 25% of market value FINRA requires the account to keep afterward. Equity is the market value minus the debit balance (the loan).

From 12 CFR 220.12: the margin required is "50 percent of the current market value of the security." eCFR, Regulation T.

From FINRA Rule 4210: the maintenance margin is "25 percent of the current market value of all margin securities" held long. FINRA, Rule 4210.

Worked example. You buy 400 shares at $50 in a margin account.

1. Purchase: 400 x $50 = $20,000.
2. Initial margin at 50%: $10,000 deposit. Debit balance: $10,000.
3. The price falls to $35. Market value: 400 x $35 = $14,000.
4. Equity: $14,000 - $10,000 = $4,000.
5. Maintenance requirement: 25% x $14,000 = $3,500. Equity of $4,000 is above it, so no maintenance call yet.

Check. Equity reaches 25% of market value when the market value is $10,000 / 0.75 = $13,333.33. At that value, equity is $3,333.33, which is 25% of $13,333.33.

Wrong methods. Using the 50% initial requirement to test for a maintenance call. Taking 25% of the original $20,000 purchase price instead of the current market value.

Firms may set higher margin requirements. Rule 4210 requires firms to "formulate their own margin requirements". A margin account also needs equity of at least $2,000, except that cash need not be deposited beyond the cost of the securities purchased.

Stock splits and cost basis

A stock split changes your share count and the price per share, while your total value and total cost basis stay the same.

From Investor.gov: a stock split is "An increase in the number of shares of a corporation's stock without a change in the shareholders' equity." SEC, Stock Split.

From IRS Publication 550: "if you receive more stock from nontaxable stock dividends or stock splits, you must reduce the basis of your original stock." IRS, Publication 550, checked November 4, 2026.

Worked example (forward split). You own 150 shares bought at $90, a total cost basis of $13,500. The company declares a 3-for-2 split.

1. New shares: 150 x 3/2 = 225 shares.
2. New price: $90 x 2/3 = $60 per share.
3. Basis per share: $13,500 / 225 = $60.

Check. 225 x $60 = $13,500, the same total as before the split.

Worked example (reverse split). You own 500 shares at $2, worth $1,000. The company does a 1-for-5 reverse split: 500 / 5 = 100 shares at $2 x 5 = $10, still $1,000.

Wrong method. Keeping the old $90 basis per share after the split. That overstates your total basis as 225 x $90 = $20,250.

Compare SIE prep options

Compare SIE prep options on whether they match the current FINRA outline and current rules, how much timed practice they give, and what each costs. FINRA does not endorse any vendor's materials, as its FAQ quoted above states.

Commercial providers such as Kaplan, STC, Knopman Marks, PassMasters and Achievable sell SIE preparation.

Each provider's own pages showed the terms below. Prices were checked on November 8, 2026.

Sources: Kaplan SIE packages, Kaplan return policy, STC SIE packages, STC refund policy, Knopman Marks SIE course, Knopman Marks terms, PassMasters SIE course, PassMasters terms, Achievable SIE course, Achievable FAQ. Checked November 8, 2026.

Compare SIE books and editions

Compare SIE books by publication date, format and what the publisher says each title is for. Publisher pages showed the details below on November 8, 2026.

Sources: Wiley guide, Wiley question book, Kaplan study tools. Checked November 8, 2026.

Wiley presents the 2027/2028 guide as general exam prep with practice tests and online flashcards, and the 1001 title as extra question practice. Check any number you study against the rule review table above.

SIE study guide PDF

A printable version of this study guide carries the same outline route, explanations and worked calculations for offline study.

The PDF is free and needs no account.

To test yourself on paper after studying, use the printable SIE practice exam with its separate answer key.

Start the SIE practice test