Following this step-by-step guide will help you to become a stockbroker in Massachusetts by registering as a broker-dealer agent with the Massachusetts Securities Division and a self-regulatory organization (SRO) while under the employ of broker-dealer firm registered to serve residents of the state.
Step 1. Get Your Education
- Becoming sponsored by a broker-dealer firm is required as part of the application process for the general securities exam. Broker-dealer firms will weigh your education in the recruitment process as they look for well-educated and enterprising candidates to sponsor.
Some degrees to consider include:
- BS-Business Administration- Finance
- BA-Consumer and Family Financial Services
- Quantitative business applications
- Behavior of persons, organizations, and groups
- Business law
- Accounting, especially managerial and financial accounting
- Business communications
Step 2: Take the Required Exams
- The Series 7 license is the standard for all stockbrokers. Applying for the Series 7 Exam requires you to first be sponsored by a broker-dealer firm registered to serve the residents of Massachusetts. There are both large global firms and local independent firms that are looking to sponsor the right candidates. Approach the firms that interest you and show them you would be an asset to their team.
- Complete the registration process for all required exams. Your sponsoring firm will assist you in this process.
Broker-dealer agents that will work with firms that are not FINRA members:
Complete Form U-10, Uniform Examination Request for non-FINRA Members.
This is an exam-only application and doesn’t satisfy registration requirements. If applying for the Series 7 Exam using this form, you’ll be required to submit a formal application for registration within two years of passing the exam.
To become a broker-dealer agent with a FINRA-member firm:
Complete Form U-4 Uniform Application for Securities Registration or Transfer.
The application consists of a questionnaire requiring you to detail some personal information including education, work experience, and any criminal history.
Your sponsoring firm will submit the proper form through the Central Registration Depository (CRD). Fees will be deducted from the firm’s general CRD User Account:
- Exam fees of $96 to take Series 63, $265 for Series 7, and $128 for Series 66 Massachusetts requires registered representatives to take the Series 63 or the Series 66. The Series 7 is not required by the state, but is required by sponsoring broker-dealer firm.
- FINRA registration requires a fingerprint card for all applicants. Contact your local sheriff’s office or police station for appointments and fees. FINRA will charge a fee of $30.25 to process your fingerprint card.
- Massachusetts initial $75 registration fee
Confirmation of the submitted application will be sent to a representative of your sponsoring firm allowing you to schedule the required exams:
Step 3: Get Your On-The-Job Training
You will be introduced to your new role as a broker-dealer agent by being provided with on-the-job training. You will likely listen to a senior agent’s sales calls to develop your sales skills and to increase your product knowledge. Many firms will offer additional courses either internally or through outside vendors to help you develop professionally.
Your training will help prepare you to properly align clients with suitable financial vehicles.
Potential areas of focus will include items covered in the Series 7 Exam:
- Corporate, municipal and treasury bonds
- Variable contracts
- Mutual funds
- Options on stocks
- Government securities
- Direct participation programs like non-publicly traded real estate investment trusts or oil and gas leases
- Corporate equity and debt securities
- Open-end and closed-end investment company shares
Step 4: Ongoing Requirements for License Renewal and Continuing Education
By law, you’ll be required to renew your license each year no later than 12/31. Your employer will pay the Massachusetts Securities Division renewal fee of $75 through the Web-CRD.
Continuing Education Requirements
The Securities Industry Continuing Education Program is the standard for all continuing education requirements. Continuing education will focus on two elements:
- The Regulatory Element
Registered representatives have four months from their second registration to complete Regulatory Element training program requirements, then again, once every three years.
- The Firm Element
An annual internal evaluation will be conducted by all broker-dealer firms to determine the areas of focus for the once-yearly Firm Element component of continuing education. It is established and delivered in accordance with Financial Industry Regulatory Authority (FINRA) guidelines to cover sales practices and suitability standards, investment features and associated risk factors, and regulatory requirements related to products, services, and marketing strategies.
Updating your Form U-4
If an amendment to any of the items on the following list is required, you must notify your supervisor or compliance team that your Form U-4 must be updated to reflect those changes.
- Customer complaints
- Civil judgments against you
- Pending or completed disciplinary actions
- Financial judgments against you
- Criminal disclosure
- Address updates
FINRA’s BrokerCheck allows the public to research broker-dealer agents in the state, so be sure clients can see your most current and accurate information.