What Is the Series 87 Exam?

The Series 87 exam, formally known as the Research Analyst (Regulatory) Exam, is one of two qualification exams required for individuals who wish to function as research analysts within the securities industry. It is administered by the Financial Industry Regulatory Authority (FINRA) and is designed to test a candidate’s understanding of the rules and regulations that govern the creation, publication, and dissemination of equity research reports.

Series 87 is typically paired with the Series 86 exam, which covers the analytical and financial modeling components of research. Together, these exams assess both the content expertise and the regulatory knowledge required to conduct and publish research in a compliant manner. Candidates must pass both exams to be fully qualified as research analysts, unless they meet certain waivers or exemptions.

Purpose and Scope

The primary focus of the Series 87 exam is on compliance and regulation. It evaluates a candidate’s familiarity with the legal and ethical standards governing research practices, particularly those designed to prevent conflicts of interest and ensure investor protection. These rules are especially important given the potential influence research reports can have on investment decisions and market activity.

The exam covers topics such as:

• FINRA rules regarding research report disclosures
• Restrictions on communications between research analysts and investment banking personnel
• Supervisory requirements for firms that publish research
• Procedures for handling non-public information
• Requirements for transparency in ratings, price targets, and valuation methods

The content of the Series 87 is heavily based on Regulation AC (Analyst Certification), Regulation FD (Fair Disclosure), and FINRA Rule 2241, among others. Mastery of these rules is essential for ensuring that research is distributed in a way that is fair, transparent, and free from undue influence.

Who Needs the Series 87?

Any individual who is primarily engaged in writing research reports about equity securities must pass the Series 86 and Series 87 exams unless an exemption applies. This includes:

• Research analysts working at broker-dealers
• Junior analysts contributing to published research
• Supervisory analysts who review and approve research content

Exemptions from the Series 86 may be granted to individuals who hold certain credentials (such as the CFA charter), but these exemptions do not apply to the Series 87. Regardless of professional background, anyone writing or approving research must demonstrate a working knowledge of regulatory standards by passing Series 87.

It’s important to note that individuals must also pass the Securities Industry Essentials (SIE) Exam and be associated with a FINRA-member firm before taking the Series 87.

Exam Structure and Format

The Series 87 exam consists of 50 scored multiple-choice questions, with a testing time of 90 minutes. The exam also includes 10 unscored pretest questions that do not count toward the final score but are used for future exam development. These pretest questions are interspersed randomly and not identified to the test taker.

A passing score is typically 74%, although this is subject to change. The questions are focused solely on regulatory content and are scenario-based to assess practical understanding. Candidates can expect questions involving hypothetical communications between analysts and other departments, disclosure requirements in a published report, and proper procedures for handling material non-public information.

Exam Topics

The Series 87 exam is based on one major function:

Regulatory Administration of Research (100%)

This includes knowledge of:

• Disclosure of interests and conflicts
• Personal trading restrictions for analysts
• Restrictions on publishing during quiet periods or after public offerings
• Information barriers between research and investment banking
• Supervisory obligations and disciplinary consequences for violations

Although the subject matter may appear narrow, the exam expects precise knowledge of how these rules apply in real-world situations.

Registration and Cost

To register for the Series 87 exam, individuals must be sponsored by a FINRA-member firm. The exam is administered through the FINRA-administered Central Registration Depository (CRD) system using the Form U4.

As of the latest published fee schedule, the cost to take the Series 87 is $130. This fee is separate from the Series 86, which carries its own registration fee.

Preparation

Preparation for the Series 87 exam involves studying regulatory rules, interpretive guidance, and practical application of compliance principles. Because the exam is regulation-heavy, study materials often emphasize reading comprehension, application of policy, and ethical scenarios. Candidates often use FINRA-provided content outlines, commercial prep providers, and firm-based training programs.

Unlike Series 86, which demands technical and financial expertise, Series 87 emphasizes interpretive reasoning and regulatory interpretation. Candidates should focus less on memorizing isolated facts and more on understanding how regulatory rules interact with everyday research practices.

The Bottom Line

The Series 87 is a necessary credential for anyone seeking to work as a research analyst in the U.S. securities industry. It ensures that professionals publishing investment research are well-versed in the regulatory environment that governs conflicts of interest, ethical conduct, and investor transparency. When paired with the Series 86 exam, it forms a comprehensive licensing path that safeguards the integrity of research within financial markets.