If you’re in Equity Research, chances are you need to take the Series 86 Exam. If it seems like a daunting task, you’re not alone. I tutor many, many FINRA exams and this one is definitely the hardest, in my view. If you want to know how to pass the Series 86 Exam in 90 days or less, keep reading 🙂

How to Pass the Series 86? Get the Right Study Material

Every single one of my students uses Securities Training Corporation (STC) study material. In fact, I haven’t seen any other reliable Series 86 study material offered that I would personally recommend. You also might like to know that as a Series 86 tutor, we at Professional Exam Tutoring have more than a 90% success rate with those that use our services.

Side Note: By no means does our high success rate guarantee a pass among our students, but if you closely follow our advice, then we can almost certainly increase your odds of success. Unfortunately there is no official Series 86 exam pass rate published by FINRA but our experience and deep understanding of the curriculum can give you a great shot.

In terms of STC’s study material, their practice questions are much more effective than the textbook. Various online forums, and anecdotal conversations with dozens of students have led me to this conclusion. The textbook is fairly thin, and the practice questions they offer online cover some material not found in the text. All of that said, with enough studying STC’s questions are a sufficient resource to achieve a passing grade!

Practice, Practice, Practice…Questions

Similar to my advice for the CFA Exam, I recommend a heavy focus on practice questions for the Series 86 Exam. As mentioned above, reading alone won’t get you by. Take STC’s practice quizzes at least twice each. The first time through you should expect to score well below what’s required to pass. It’s the second (and quite possibly, third) time when the concepts should be sinking in. Since there is a limited set of questions, you will likely memorize some of the answers. To combat this, I recommend students wait until they score in the 90%-plus range before they take the exam. I should note that this is the score you should eventually expect after having taken the exam multiple times.

Manage Your Time Wisely

You will likely notice that FINRA‘s Series 86 Exam’s questions are very involved. Even when you know them well, some can take as long as three to four minutes to solve. On the flip side, there are others that will take less than 20 seconds. You have 4.5 hours to complete about 100 questions. That’s a little over 2.5 minutes per question. Although this might seem like a lot, if you get stuck on two or three really long questions, you could find yourself crunched for time. Make sure to time yourself before you take the exam. To be sure, leave yourself a margin of safety. For example, aim to finish your practice questions at least 20 minutes before the 4.5 hour mark so you’re not sweating for time.

All in all, to pass the Series 86 exam is not impossible. A little studying, and a lot of practice questions should help you on your way!

Series 86 Exam Pass Rate: How to Get Yourself Over The Hump

As mentioned, the Series 86 exam pass rate is not a metric that you can easily find with a quick Google search. In fact, FINRA doesn’t publish (as of this writing) the Series 86 exam pass rate.

To get a general idea of the pass rate, you’ll have to settle for some anecdotal evidence. Fortunately, I have plenty. I have spent years not only as a CFA tutor, but as a Series 86 tutor as well. Of all of the exams that I tutor, the Series 86 exam is one of the hardest. Although the Series 86 Exam is officially changing (as of May 2023), the below is still relevant.

Note: This includes the CFA exam! 

(And I’ve seen many folks experience a failed CFA Level 1 exam)

Let’s walk through the ways in which you can be on the right side of the Series 86 exam pass rate.

Series 86 Exam Pass Rate: The Unknown Knowns

Without any hard data on the Series 86 exam pass rate, I can’t give you an exact probability of success. What I can tell you however, is that it’s not easy. From my own experience, I can tell you that it is the only FINRA exam that I ever failed (I passed on my second attempt). For the students I tutor, I have seen many experience the same outcome.

Students from all different backgrounds have trouble with the Series 86 exam. From state schools graduates to the Ivy Leagues, most students start out getting in the 50% range on their practice exams. It typically takes up to two months of studying before most people are “test ready.”

Best Resources

When it comes to studying for the Series 86 exam, there is really only one resource as discussed above: STC. As you can imagine, this has its drawbacks. For instance, most of my students run out of practice questions. The only alternative unfortunately, is to go over the same ones multiple times. As such, it’s hard to gauge when exactly you’re ready for the exam. You might be scoring in the low-to-mid 80s but have memorized more than you think (so your practice scores aren’t a true reflection of you potential “exam day” score). For this reason, I highly recommend that you only take the exam when you score in the high 80s or low 90s if you’ve been repeatedly practicing the same questions. I have seen others pass with lower scores but don’t risk it. The STC is a great resource, so stick to the questions and make sure you know them thoroughly before you take the exam.

Try and pay particular attention to the questions that are fairly involved. Practice identifying the necessary information to solve a problem so you are quick when it comes to the real thing. It’s a challenging test, and it’s better to go in knowing all you can.

So what makes it so hard?

Longer Questions

For starters, some questions on the exam can take several minutes to answer due to their complexity. You will notice that many of the questions resemble mini case-studies. They require careful reading, analysis, and comprehension. For this reason alone, I believe that the Series 86 exam is harder than most other FINRA exams. The questions are significantly longer, and the calculations involved are generally more difficult than the Series 7 Exam.

The Series 86 exam is 100 questions in length. Despite a more truncated exam than the Series 7 Top-Off Exam, 80% of it comprises analysis, modeling, and valuation. These questions can be long and time consuming. Here is a quick tip to help you on your test-taking strategy: When you come across a difficult question that you think will take you at least a few minutes, skip it! Yes, you read that right. Skip it and move on.

Don’t worry, you will come back to it later, but only once you finish all the other questions. Of course, you might find this happens to you several times during the exam. That’s ok (and should be expected). The reason you want to skip these long ones is that you want to be sure to get to as many of the questions you can quickly (or at least confidently) answer right off the bat.

Series 86 Passing Score

To pass the Series 86 exam you need at least a score of 73%.Unfortunately, this is not so easy. One way to avoid having to take the Series 86 entirely however is if you have already passed CFA Level 1 and CFA Level 2. You can request an exemption from FINRA if you fit this bill.

As challenging as it sounds, the Series 86 exam is still passable. The exam is dwarfed when compared to the CFA exams. Furthermore, despite being 100 questions long, you will have 4.5 hours to finish the exam. If you have some time left over I highly recommend you use every second to review your answers even if you finish early. More than likely you made a mistake somewhere and this extra effort could help you correct any errors made in haste.

All the above is not to discourage you, but to make sure you take the Series 86 exam seriously.

Series 86 Exam Tips: How to Master a Tough Exam with Little Time

As a Series 86 tutor we often get the same questions again, and again. One we get this a lot is “Are there any Series 86 Exam tips that you can share to get me through this exam faster?”

The short answer is: Yes. The longer answer is: These Series 86 Exam tips will not likely accelerate progress as fast as you’d probably like.

Series 86 Exam Tips

Our tips and tricks at Professional Exam Tutoring are our secret sauce but below I will share some broader tips that we also offer in our private sessions. In fact, our success rate is quite good for this exam (referenced above) so these little tidbits should be helpful. The Series 86 exam pass rate is extremely high among our students. Nonetheless, studying for this exam takes time. Here are some things you should know.

1. The Study Material is Limited - The Securities Training Corporation(STC) is the standard bearer when it comes to Series 86 curriculum. We have yet to come across a Series 86 student that has not be assigned STC’s text for their exam. Nonetheless, if you search on Amazon.com you can find one or two obscure practice resources. We don’t recommend these. Although the STC text is not a huge help, their material is valuable if just for the practice questions.
2. A Lot of Content to Cover - Many students expect to ramp their practice scores by the third practice exam. The average student won’t experience a ramp until the sixth practice exam, and sometimes later. Sometimes this ramp might not happen until the second time through the practice exams. The best tip we can offer here is to be patient. This is the hardest exam (in our opinion) of all the FINRA exams. Don’t expect to learn everything you need to know after taking two or three practice exams.
3. The Questions Are Complicated - The questions are hard and time consuming. The most common frustration we hear is that the questions take a long time to solve. Not only that, but toward the beginning of your study journey, they will take even longer. You can expect the first practice exam to take upwards of five to six hours. There are a few reasons for this. First, remember what I mentioned above. Namely, even if you read the entire text book, there will be questions that cover material not found in the text. You will need time to understand the concept, and then how it applies to the question. Second, there are myriad ways to ask the same question. You will be tested on the same concepts multiple ways, so learn to how to approach the questions from different angles.

If you need a tutor, you know where to find us. If not, just take your time (if you have it). This exam trips up a lot of people, and is one of the few FINRA exams that many smart people fail. Put in the time, and you’ll get it done.

The Best Series 86 Study Material: Where’s the Beef?

Try to do a search for Series 86 study material and you may be underwhelmed. I have been a Series 86 tutor for years, and it’s rare to find practice questions beyond STC on the subject. I frequently get asked what a student’s best options are for studying for the Series 86. While I touched upon this earlier, what follows is more detail on the matter.

STC Series 86 Study Material: Where’s the Beef?

If you’re looking for additional practice questions for the Series 86, you may be out of luck. Although the Series 86 study material from the Securities Training Corporation (STC) is not all there is, this company is the main source for study material out there. I frequently hear from students that they need more practice questions. The STC offers a number of practice exams, but many students get through them quite quickly. Furthermore, if a student fails, they have to reuse the same practice questions – which they’ve probably memorized. Mometrix is another Series 86 prep provider. You can get more questions through them, and their text, although STC remains our favourite.

Review Concepts, Don’t Memorize

Since the Series 86 study material out there is so limited, most students run out of practice problems. Consequently, it is often tough to know what your real score is when you’re repeating the same practice tests. Many of my students can’t help but memorize the answers to their practice exams after they take them 3+ times.

If you still have a lot of time until you’re exam, and you’ve already thoroughly gone through your practice tests, then the best that you can do is to make sure that you truly understand the underlying reasons to the answers to problems. This may seem like common sense. However, you’d be surprised how many people convince themselves that they know the underlying reasons for an answer, but in reality they’ve just memorized them. If you feel like you’re memorizing then aim for 90% plus on your practice questions. Alternatively, a tutor can also help by taking you through different examples on the fly to show you variations of the problems you’ll practice.

CFA FR&A Level 1 and Level 2

For those of you fortunate enough to have completed CFA Level 1 and 2, you lucked out. You’re exempted from the Series 86 and Series 87 exams. If you have only finished CFA Level 1, then you’ll have some overlap with the Series 86. It covers LIFO, FIFO, depreciation expenses, deferred tax assets/liabilities, and many other shared topics. The main topic that you will find overlaps the Series 86 Exam and the CFA Level 2 is the accounting for acquisitions section. For example, the cost method, equity method, and acquisition method of accounting for mergers and investments are discussed in both.

While there is not a lot of study material out there for the Series 86, you really have all you need with STC. Nobody wants a failed Series 86 exam, and if you study enough, you’ll get by.

Failed Series 86 Exam Got You Down? There’s Hope

When a student comes to me after a failed Series 86 exam, it’s not surprising. Of all the different FINRA exams that I tutor, the Series 86 exam for equity research associates is the most challenging. Here I offer some suggestions as to how you can avoid this unfortunate fate. There’s hope yet, I promise!

A Failed Series 86 Exam: What Went Wrong

There is one issue that I consistently see from students that request my services after a failed Series 86 exam. That is, a lack of thorough preparation. What I mean by this is that many students that fail this exam the first time assumed that they could go in with practice exam scores in the high 70% range and they would be ok (as is often the case for the SIE Exam).

The Series 86 exam pass rate is not published anywhere, but anecdotally speaking it’s definitely lower than the other FINRA exams. The questions are very challenging. Thus, more than a small cushion above the required passing grade (a score of 73%) is needed on your practice tests to ensure that you pass. As mentioned above, I encourage my students not to go into the exam unless they are scoring somewhere in the high 80% range on their practice exams. This typically does the trick.

STC or Bust

If you’re reading this, then you are likely familiar with the STC. Owned by a private equity firm, they are one of the only providers of a comprehensive batch of study material for the Series 86 exam. Their practice tests are great, and I recommend them highly. To avoid a failed Series 86 exam, be sure to use these practice tests.

That said, I have seen many students still score in the low-to-mid 80% range (after retaking the same questions) and fail the exam. If you’re taking the same practice questions, then remember what I mentioned above (aim for the 90% range). If that doesn’t convince you, then try a famous Richard Feynman quote: “The first principle is that you must not fool yourself – and you are the easiest person to fool.” Make sure you can tell the difference between whether you know the material, or have memorized the answers to those practice questions.