Sample Series 66 Questions: What You’ll Actually See on Exam Day

You’re staring at a practice exam and the words "Investment Adviser Representative" start to look like a blur. It happens. Honestly, the Series 66—formally the Uniform Combined State Law Examination—is a beast because it’s not just about finance; it's about the law. You’ve already cleared the SIE and likely the Series 7, so you know how to trade a call option or explain a mutual fund. But now? Now NASAA wants to know if you understand the nuanced difference between a "person" and an "individual" under the Uniform Securities Act (USA). It sounds like semantics. It is. But those semantics determine whether you keep your career or end up with a fine that makes your eyes water.

Studying sample series 66 questions isn't just about memorizing facts. It’s about pattern recognition. The North American Securities Administrators Association (NASAA) loves to trip you up with "except" and "not" questions. If you aren't careful, you'll find yourself picking the most "ethical" sounding answer, only to realize the question was asking about a specific legal exemption for a federal covered adviser.

The Legal Logic Behind the Series 66

The exam is essentially a 100-question gatekeeper. You get 150 minutes. That’s plenty of time, but the mental fatigue is real. The weightage is lopsided, too. You’ve got about 45 questions on Economic Factors and Business Information, while the rest dives deep into Investment Vehicle Characteristics and, most importantly, Laws, Regulations, and Guidelines.

Why does this matter? Because you can’t "common sense" your way through the legal sections. If a sample series 66 question asks you about the registration of a broker-dealer that has no office in a state but has three retail clients there, your gut might say they don't need to register. Your gut would be wrong. In the world of the USA, one retail client is often enough to trigger registration requirements, unlike the "de minimis" rule for Investment Advisers, which usually allows for five or fewer retail clients.

Understanding the "Person" Concept

In the legal context of this exam, a "person" is almost anything. A corporation is a person. A partnership is a person. An estate is a person. The only ones who aren't "persons" are minors, deceased individuals, and those declared mentally incompetent. You’ll see questions that try to trick you by listing a deceased individual and asking if they can be a "person" under the act. They can't. It’s a binary thing.

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Breaking Down Sample Series 66 Questions on Ethics

Ethics and fiduciary duty make up a massive chunk of your score. This isn't just "don't steal." It's much more granular. For example, consider the rules regarding performance-based fees. Generally, they are prohibited. Why? Because they encourage "churning" or taking unnecessary risks to juice returns. However, if you’re dealing with a "qualified client"—someone with at least $1.1 million under management or a net worth over $2.2 million—the rules change.

I’ve seen students get frustrated because they remember the rule but forget the exception. Or they confuse "qualified client" with "accredited investor." They aren't the same. One is a SEC Rule 501 concept (Series 7 territory), and the other is an Investment Advisers Act of 1940 concept.

Soft Dollars and Disclosures

What about soft dollars? This is a classic sample series 66 question topic. An Investment Adviser (IA) gets "soft dollars" from a broker-dealer in exchange for directing trades their way. Is this allowed? Yes, but only for things that benefit the client. Research reports? Yes. Specialized software for analysis? Sure. New office furniture or a tropical vacation for the IA? Absolutely not.

If you see a question asking which of the following is an acceptable use of soft dollars, look for the item that directly helps the investment decision-making process. If it’s "marketing expenses," it’s the wrong answer.

Why the Federal vs. State Distinction is a Nightmare

This is where most people lose points. You have to keep two different rulebooks in your head at once: the Investment Advisers Act of 1940 (Federal) and the Uniform Securities Act (State).

Basically, the "cutoff" is usually $100 million in Assets Under Management (AUM).

• Under $100 million: You’re likely a State-registered adviser.
• Between $100M and $110M: You have a choice (the "buffer").
• Over $110 million: You MUST be a Federal Covered Adviser (SEC registered).

Wait, it gets weirder. Even if you are Federal Covered, the state still wants their cut. You don't "register" with the state, but you do a "notice filing." If a question asks if a Federal Covered Adviser has to follow state net capital requirements, the answer is no. Federal law preempts state law here thanks to NSMIA (the National Securities Markets Improvement Act of 1996).

If you get a question about a Federal Covered Adviser's brochure delivery requirements, don't use the state rules. Under federal law, the brochure must be delivered at or before the time of entering into a contract. There is no "5-day penalty-free withdrawal" rule in federal law like there is in many state-level interpretations of the USA (though the USA itself specifies the 48-hour rule or 5-day withdrawal).

Sample Series 66 Questions: Investment Vehicles

You might think you’re done with the math after the Series 7. You aren't. You won't be doing heavy equations, but you need to understand the concepts behind the math.

Discounted Cash Flow (DCF) and Net Present Value (NPV)

Expect questions that ask what happens to the price of a bond if the market interest rate rises above the coupon rate. (The bond trades at a discount). But the 66 takes it further. It might ask which valuation method uses the "internal rate of return" to find the present value of future cash flows. That's DCF.

You also need to be crystal clear on:

1. Current Yield: Annual Coupon / Current Market Price.
2. Yield to Maturity (YTM): The "true" return if held to the end.
3. Total Return: Capital gains plus reinvested dividends/interest.

A common trick in sample series 66 questions involves "Real Rate of Return." If you see this, just subtract inflation (the CPI) from the nominal return. If the portfolio returned 10% and inflation was 3%, your real return is 7%. Don't overcomplicate it.

Alternative Investments

Don't ignore REITs, DPPs, and Viatical Settlements. Viaticals are particularly "testable" because they are weird. You’re basically buying the death benefit of a terminally ill person’s life insurance policy. It’s a security. It’s risky. It’s illiquid. If a question asks about the suitability of a viatical for a retiree needing monthly income, the answer is almost always "unsuitable."

The "Not-a-Security" List

This is a freebie if you memorize it. Not everything is a security. If you see these on the exam, they are NOT securities under the USA:

• Fixed annuities (because the insurance company takes the risk).
• Life insurance (non-variable).
• Commodities (like gold or wheat).
• Collectibles (antiques, baseball cards).
• Your personal residence.
• Futures contracts.

If a sample series 66 question asks which of the following must be registered, and "Gold bullion" is an option, cross it off immediately.

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Navigating the Registration Process

Who has to register? This is the core of the exam.

• Broker-Dealers (BDs): Almost always.
• Agents: The humans working for BDs.
• Investment Advisers (IAs): The firms.
• Investment Adviser Representatives (IARs): The humans working for IAs.

Here is a nuance that kills scores: An IAR only registers in states where they have a place of business OR more than five retail clients. But if you work for a Federal Covered Adviser, you only register in the states where you have a physical office. The "five-client" rule doesn't apply to IARs of federal firms. It’s a tiny detail, but NASAA loves tiny details.

Form ADV

You need to know your forms.

• ADV Part 1: Information about the business, ownership, and any "disciplinary events" (the bad stuff).
• ADV Part 2A: The Brochure. It describes fees, investment strategies, and conflicts of interest. It’s written in plain English.
• ADV Part 2B: The Brochure Supplement. Think of this as the "bio" for the individual IARs.

If an IA makes a material change to their brochure, they have 120 days from the end of their fiscal year to send a summary of those changes to existing clients. Not 90 days. Not 30 days. 120.

Practical Application: How to Study Effectively

Don't just read the book. You’ll fall asleep by page 40.

First, take a diagnostic test to see where you’re weak. If you’re crushing the "Economic Factors" but failing "Laws and Regulations," stop reading about the Federal Reserve and start reading about the North American Securities Administrators Association's model rules.

Second, use flashcards for the timeframes. There are dozens.

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• 30 days for a registration to become effective.
• 30 days to report a change in Form U4.
• 60 days for a client to sue for a violation of the USA.
• 3 years is the statute of limitations for civil liabilities (or 2 years after discovery).

Third, watch out for the "Two-Client" trap. Some questions will mention a broker-dealer with no office in State A but two institutional clients (like banks) in State A. Does the BD register? No. Institutional clients don't count toward the registration trigger if there's no physical office.

Misconceptions That Will Cost You Points

A big one: People think "discretion" and "custody" are the same. They aren't.
Discretion is the authority to decide which security, how much, and whether to buy or sell.
Custody is actually holding the client's money or stock certificates.
If you have custody, the net capital requirements are much higher (usually $35,000 for an IA). If you only have discretion, it’s usually $10,000. If you have neither, you just need to be solvent.

Another misconception is that all "exempt" securities are exempt from everything. They are only exempt from registration and filing of sales literature. They are NEVER exempt from the anti-fraud provisions. Fraud is fraud, whether you're selling a Treasury bond or a speculative tech startup.

Action Plan for Your Final Week

• Take at least three full-length practice exams. You need to build the "sitting stamina" for 110 questions (100 scored, 10 "experimental" ones that don't count).
• Read the "Unethical Business Practices" model rule. Seriously. Go to the NASAA website and read the actual text. It’s surprisingly readable and covers things like borrowing money from clients (usually a no-no unless the client is a lending institution) and sharing in accounts.
• Drill the "Except" questions. When you see "All of the following are true EXCEPT," physically cover the answer choices and try to name three true things first.
• Focus on the Brochure Rule. Know exactly when it must be delivered and when the "summary of material changes" is due. This is a high-probability area.
• Don't ignore the SIE basics. Sometimes you’ll get a question on 12b-1 fees or the difference between an open-end and closed-end fund. If you’ve forgotten those since the Series 7, you're giving away easy points.

The Series 66 is a hurdle, but it’s a fair one. It’s designed to ensure you aren't just a salesperson, but a professional who understands the gravity of the fiduciary duty. Once you pass, you're fully registered to provide investment advice for a fee, which is a massive milestone in your career. Keep your head in the laws, watch the "de minimis" numbers, and remember that when in doubt, the Administrator has the power to look at your books and records whenever they feel like it—as long as it's during business hours.