CFA vs FINRA Series 7
Last Update On 4th March 2025
Duration: 6 Mins Read
Among a wide variety of careers in finance and investments, two of the most discussed credentials are the CFA charter and the FINRA Series 7 license. Each has a different purpose and will lead you down a different career path. Understanding the key differences and similarities between the CFA and FINRA certifications is important in determining which one aligns with your professional goals. In this article, I explore some key features of the CFA program and FINRA Series 7 to help you decide for yourself.
What is the CFA?
The CFA Charter is a professional certification issued by the CFA Institute globally to investment
professionals who wish to be thought leaders in investment management and financial analysis. In extensive detail, the CFA curriculum covers portfolio management, equity research, derivatives, ethics, and fixed income. Such a highly acknowledged designation is achieved after three time-consuming levels of rigorous testing and difficult-to-meet job experience criteria.
The CFA program is ideal for candidates interested in pursuing positions such as financial analyst, portfolio manager, or risk manager. Due to the thoroughness of the program related to finance and investment principles, the CFA charter has typically been considered the gold standard within the profession.
What is the FINRA Series 7?
The General Securities Representative license, or Series 7 license, is obtained from the Financial Industry Regulatory Authority. This license empowers such professionals to operate or sell securities such as options, mutual funds, stocks, and bonds.
This license could be achieved in FINRA Series 7 after passing the SIE (Securities Industry Essentials) examination, along with sponsorship from any FINRA-registered firm. The FINRA Series 7 exam checks how well a candidate understands important concepts like taxation, risks associated with investment, and retirement plans. Such licenses are a must for one to practice as a stockbroker or in another profession dealing with securities.
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CFA vs FINRA Series 7: Key Differences
How Are CFA and Series 7 Similar?
Both the CFA and FINRA Series 7 are a suite of various exams that candidates must demonstrate their endurance for. Each also functions as a benchmark of competence in its respective field. While the CFA syllabus focuses on investment analysis and management, the Series 7 license is tailored for securities trading and client interactions.
What Are the Requirements for CFA vs. Series 7?
The following are the various eligibility criteria that a candidate must satisfy to pursue the CFA charter:
- Hold a bachelor’s degree or be in the final year of their undergraduate study.
- Have 4,000 hours of work experience in a profession or one that combines both education and experience.
To gain the FINRA Series 7 license, a candidate should:
- Pass the SIE Exam.
- Secure sponsorship from a FINRA-registered firm.
- Complete four months of employment with the sponsoring firm before registering for the Series 7 exam.
What Are the Exam Topics for CFA vs FINRA Series 7?
Some of the areas that are usually covered in the CFA program curriculum include:
- Ethics and professional standards
- Portfolio management
- Fixed income and equity investments
- Derivatives
- Alternative investments
- Corporate finance
Some issues to be covered in the FINRA Series 7 examination include:
- Taxation
- Equity and debt instruments
- Investment risk
- Retirement plans
- Packaged securities
- Client interactions
How Do CFA and Series 7 Exam Formats Compare?
The CFA exams are available at three levels, each with a combination of multiple-choice questions, together with constructed response questions at Level III. These examinations are available on certain dates throughout the year. However, the FINRA Series 7 license involves one computer-based examination accessible all year round and also allows a window of 120 days after enrollment into the exam.
What Are the Fees for CFA vs. Series 7?
It requires a one-time enrollment fee of $350 to the CFA program; the exam fees range from $900 to $1,200 per level depending on the date of registration. A candidate is required to pay an annual CFA Institute membership fee of $275.
The FINRA Series 7 exam fee is $300, and one will also have to pay for the SIE exam, which is $80. Employers usually pay these fees on behalf of candidates.
What Are the Pass Rates for CFA vs FINRA Series 7?
The CFA exams have a low passing rate:
- Level I: Approximately 41%
- Level II: Approximately 44%
- Level III: Approximately 56%
In comparison, the FINRA Series 7 exam is usually passed by an average of 71% of applicants.
How Should You Prepare for CFA vs FINRA Series 7 Exams?
There is a difference in the complexity level and focus area of the CFA and FINRA Series 7, which demands different approaches to preparing for them.
CFA Exam Preparation: The CFA program is considered one of the most difficult tests in the world and requires at least 300 hours of studying per level. The curriculum of the CFA program covers all areas of topics, including ethics, financial analysis, portfolio management, and derivatives. Candidates use comprehensive CFA preparation materials that include mock exams, practice questions, video lectures, and detailed summaries. This structured approach makes one comprehend some of the critical areas of finance that are quite critical to pass through the three levels of CFA.
FINRA Series 7 Exam Preparation: Though not as grueling as the CFA exams, the FINRA Series 7 does take some effort to pass. Candidates normally require studying 80 to 150 hours, which is very dependent on their background in finance. Targeted guides, practice exams, and interactive learning tools are considered crucial in mastering topics such as taxation, equity and debt instruments, and client interactions. Apart from that, the Series 7 test differs from the CFA program in that it is more practical, trading in securities and acting as a stockbroker.
How Can You Choose Between CFA and FINRA Series 7?
The choice between the CFA charter and the FINRA Series 7 license will depend largely on your goals and aspirations in the profession.
Choosing the CFA Program: The CFA course is ideal for anybody who wants to have a career in investment management, portfolio analysis, and financial research. Because of the depth of knowledge and competence that the CFA charter shows in making investment decisions, the CFA charter has earned global respect as the gold standard among financial professionals. The curriculum is demanding for candidates wanting high finance positions with credibility in that field.
Choosing the FINRA Series 7 License: On the other hand, the FINRA Series 7 license is a necessity for people who want to sell securities or practice as stockbrokers. This license thus permits practitioners to practice in the trading of stocks, bonds, mutual funds, and other securities. It is especially ideal for those individuals who have an interest in working with clients directly in brokerage firms or financial advisory services.
Making the Decision: Finally, your decision should take into account your long-term career goals. Here, you have to ask yourself whether you prefer the more analytical niche in investment management or the sales-oriented niche in securities trading. Often, it is advisable to pursue both designations since employees of brokerage firms may equally want to enhance their investment management skills.
This will enable you to understand the preparation requirements for various certifications and their career implications, hence helping you make an appropriate decision that fits your professional goals.
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Conclusion
Both the CFA and FINRA Series 7 enjoy their importance in their respective fields. Once the key differences are known to you, relating those differences to your career goals should help you make a prudent choice. Whether you choose to go with the CFA program for its comprehensive focus on investment analysis or the FINRA Series 7 license as a means to become experienced in securities trading, both paths are enormously rewarding in the finance sector.
FAQs on CFA vs FINRA Series 7
Is the CFA harder than the bar?
While both are moderately difficult exams, the CFA exams tend to be more challenging in their breadth, with a generally lower pass rate.
What are the hardest FINRA exams?
The Series 7 exam is considered one of the more difficult FINRA exams because it encompasses a wide range of topics about securities trading.
Is Series 7 easier than CFA?
Yes, the Series 7 is considered much easier as compared to the CFA exams, since the Series 7 concentrates on the trading of securities and does not go further in the aspect of intense financial analysis.
What is harder, SIE or Series 7?
The Series 7 exam is a little more difficult to pass than the SIE simply because it is more advanced, requiring greater depth in the understanding of trading in securities.
What does FINRA stand for?
FINRA stands for Financial Industry Regulatory Authority, the self-regulating organization that oversees United States brokerage firms and securities markets.
