Study guide · 2026 Edition
Series 66 — Uniform Combined State Law — Complete Study Guide (2026)
PrepPass's independent 2026 study guide for the NASAA Series 66 exam is 747 pages (193 teaching + question bank) with 1,161 practice questions and a full answer key, PDF + EPUB, $24.99 one-time; it is not affiliated with the exam provider. The book does not include PrepPass's separate online timed mock for this exam (100 questions, 150 minutes).
- Length
- 747 pages (193 teaching + question bank)
- Practice questions in the book
- 1,161
- PrepPass online timed mock
- 100 questions · 150 min
- Exam facts checked, file updated
- October 2026
- Delivery
- PDF + EPUB · English · instant download
Please read before you buy: This is an independent study aid, not affiliated with or endorsed by NASAA, FINRA, or Prometric.
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The Series 66 is a NASAA exam administered by FINRA; this guide is authored from the public Uniform Securities Act, NASAA model rules, and the Investment Advisers Act of 1940. Some dollar thresholds (the qualified-client net worth/AUM figures, the gift-tax exclusion) are indexed and change — this guide teaches the underlying rules and flags indexed figures to 'verify current year'; it is general educational information, not legal or investment advice.
What is in the NASAA Series 66 (Uniform Combined State Law) study guide?
The real exam: Uniform Combined State Law Examination (Series 66) — 110 questions (100 scored, 10 unscored pretest) · 150 minutes · Passing score: 73 of 100 correct.
Nineteen chapters that follow NASAA's four content areas, law first: the Uniform Securities Act, NASAA model rules and the Investment Advisers Act of 1940, plus the economics and product knowledge the Series 66 tests.
Exam fee: $177 per attempt, paid to FINRA. A retake pays it again. This guide: $24.99, one time.
Exam facts, who it suits and what changed
About the exam itself
| Administering body | North American Securities Administrators Association (NASAA) — exam delivered by FINRA |
|---|---|
| Questions | 110 questions (100 scored, 10 unscored pretest) |
| Time limit | 150 minutes |
| Passing score | 73 of 100 correct |
| Fees |
Source: NASAA — Exam FAQs |
| Languages offered | English Source: NASAA — Exam FAQs |
Look inside the book
Three real pages, rendered straight from the PDF you download — a reference page, a teaching page, and a worked question, always in that order. Nothing here was redrawn to look better.
- Quick referenceAppendix — Question Bank 1,161 practice questions with answers and explanations · PDF page 628
A page you can turn back to: the numbers, deadlines or terms gathered in one place.
- How it's taughtChapter 14 — Equity and Valuation Common stock, ADRs and shareholder rights · PDF page 153
An explanation page: the material taught in prose, in the order the exam tests it.
- A question, workedAppendix — Question Bank 1,161 practice questions with answers and explanations · PDF page 356
A practice question with its answer and the reasoning behind it — not just a key.
Exam inside two weeks?
This guide is the teaching, read over weeks. If your exam is inside two weeks, the printable colour cheat sheet is the other product: the figures the exam turns on, laid out by section.
See the NASAA Series 66 cheat sheet PDF — $9.99 →
6 pages · US Letter · printable PDF · yours to keep
What's included — and what isn't
Included
- Nineteen chapters covering NASAA's four content areas, law first (45%), with a table mapping the chapters to the official weights
- Every chapter closes with a key-facts box and a named exam-traps list
Not included
- No printed copy is shipped — this is a file you download and can print yourself
- No video course, instructor or tutoring comes with the book — the free videos on the site are separate
Everything included, and everything that isn't
Included
- Registration of broker-dealers, agents, advisers and representatives, exempt securities versus exempt transactions, Administrator powers, the Investment Advisers Act of 1940 and fiduciary duty
- Worked math: Sharpe ratio, beta, CAPM, taxable-equivalent yield, duration, time value of money
- Prohibited and unethical business practices, the most heavily tested trap area
- 193 pages of teaching, then a question bank of 1161 practice questions, grouped by topic, with answers and explanations
- PDF (print & tab it) + EPUB (phone / e-reader)
Not included
- Not your exam registration or the testing centre's fee, which you still pay to the official body
Contents
See 21 sections and the page each one starts on
- Chapter 1 — Federal Law Foundationsp. 11
- Section 15: broker-dealers register with the SEC, join a self-regulatoryp. 21
- Chapter 2 — Adviser Registration and Compliance Investment adviser representatives, qualificationp. 24
- Chapter 3 — Broker-Dealer and Agent Registration, Records and Supervisionp. 33
- Chapter 4 — The State Act, 1956 and 2002, and Communicationsp. 42
- Chapter 5 — Conduct, AML, Privacy, Seniors and Due Diligencep. 54
- Chapter 6 — FINRA Rules and Regulation Best Interestp. 64
- Chapter 7 — Client Types and Profilingp. 70
- Chapter 8 — Strategies and Techniques Modern portfolio theory and the efficient frontierp. 78
- Chapter 9 — Taxation Income tax brackets and marginal rates (2026)p. 85
- Chapter 10 — Retirement Plans and ERISA Retirement plan types and 2026 limitsp. 95
- Chapter 11 — Education, Health, Ownership and Estatep. 107
- Chapter 12 — Trading and Returns Order types and how they executep. 119
- Chapter 13 — Cash and Fixed Income Insured deposits and the money marketp. 130
- Chapter 14 — Equity and Valuation Common stock, ADRs and shareholder rightsp. 142
- Chapter 15 — Offerings and Equity Compensationp. 151
- Chapter 16 — Pooled Products and Derivatives Unit investment trusts, ETFs and REITsp. 160
- Chapter 17 — Annuities, Insurance, Alternatives and Digital Assetsp. 172
- Chapter 18 — Quantitative Methodsp. 181
- Chapter 19 — Financial Ratios and Valuation Modelsp. 188
- Appendix — Question Bank 1,161 practice questions with answers and explanationsp. 194
Taken from the PDF you download, with the page each one starts on — not typed here.
Read a chapter free, in full
One complete chapter, exactly as it ships in the eBook. Scroll the window to read it right here; no download, no email.
Read chapter 18 here, without leaving the page
We didn't give you the easy intro — the free chapter opens on one of the hardest-working parts of the book, so you can judge the teaching where the exam gets difficult.
Time value of money: future value, present value, NPV and IRR
Money received sooner is worth more than money received later, because it can be invested. All the formulas below use one idea: moving a dollar amount across time at a rate of return.
Future value
FV = PV x (1 + r)^n
Worked example. $10,000 invested at 6% a year for 8 years: $10,000 x 1.06^8 = $10,000 x 1.5938 = $15,938.48.
If interest compounds quarterly the rate per period is 6% / 4 = 1.5% and there are 8 x 4 = 32 periods: $10,000 x 1.015^32 = $16,103.24. More frequent compounding gives a larger amount.
Rule of 72. Years to double is about 72 divided by the annual rate in percent. At 6%, 72 / 6 = 12 years. Check: $10,000 x 1.06^12 = $20,121.96. The rule is an approximation that works best between 6% and 10%.
Present value
PV = FV / (1 + r)^n
Worked example. A client wants $20,000 in 5 years and can earn 7%. PV = $20,000 / 1.07^5 = $20,000 / 1.4026 = $14,259.72. The client needs $14,259.72 today.
Present value of a series. To receive $1,000 at the end of each year for 5 years with a 6% discount rate, discount each payment: $943.40 + $890.00 + $839.62 + $792.09 + $747.26 = $4,212.36.
A higher discount rate gives a lower present value; a longer time gives a lower present value.
Net present value
NPV is the sum of the present values of all cash flows, including the initial outlay, discounted at the required rate of return.
Worked example. A project costs $10,000 now and returns $3,000, $4,000 and $5,000 at the end of years 1, 2 and 3. The required return is 8%.
| Year | Cash flow | Discount factor | Present value |
|---|---|---|---|
| 0 | -$10,000 | 1.0000 | -$10,000.00 |
| 1 | $3,000 | 1/1.08 | $2,777.78 |
| 2 | $4,000 | 1/1.08^2 | $3,429.36 |
| 3 | $5,000 | 1/1.08^3 | $3,969.16 |
| NPV | +$176.29 |
NPV is positive, so the project earns more than 8% and adds value. Decision rule: accept if NPV is greater than zero; reject if negative. The profitability index (present value of inflows / outlay) is 10,176.29 / 10,000 = 1.018.
Internal rate of return
IRR is the discount rate at which NPV equals zero. There is no direct formula. Solve by trying rates.
Worked example (same project).
| Trial rate | NPV |
|---|---|
| 8% | +$176.29 |
| 9% | -$20.07 |
| 10% | -$210.37 |
The sign changes between 8% and 9%, so the IRR is just under 9%. Linear interpolation between 8% and 10%: 8% + 2% x 176.29 / (176.29 + 210.37) = 8% + 0.91% = 8.91%. Refining gives IRR = 8.90%. At 8.90%, NPV is almost exactly zero.
Decision rule: accept if IRR is greater than the required return (8.90% > 8%: accept). The NPV and IRR rules agree here.
When NPV and IRR disagree. For mutually exclusive projects of different size or cash-flow timing, IRR can rank the projects differently than NPV. NPV assumes cash flows are reinvested at the required rate; IRR assumes reinvestment at the IRR itself, which is less realistic. A project with cash flows that change sign more than once can have more than one IRR. In these cases NPV is the better guide because it measures the dollar value added.
Where it appears in advice. IRR is used to compare investments with irregular cash flows, such as private equity. The money-weighted return of a portfolio with deposits and withdrawals is an IRR.
Key facts — Time value of money: future value, present value, NPV and IRR - FV = PV x (1 + r)^n; PV = FV / (1 + r)^n. - Rule of 72: doubling time = 72 / rate. - NPV > 0: accept. IRR > required return: accept. - IRR is the rate at which NPV = 0. - NPV is preferred when NPV and IRR conflict.
Exam traps
- Using the annual rate with monthly periods.
- Forgetting the initial outlay in NPV.
- Assuming a higher IRR project is always better than a larger project with a higher NPV.
Descriptive statistics: mean, median, mode, range and standard deviation
Mean, median, mode and range
Worked example. A fund's monthly returns (in percent) over seven months: 4, 8, 6, 5, 3, 8, 9.
- Sort: 3, 4, 5, 6, 8, 8, 9.
- Mean = (4 + 8 + 6 + 5 + 3 + 8 + 9) / 7 = 43 / 7 = 6.14.
- Median = the middle value of the sorted list = 6. With an even count, the median is the average of the two middle values; for 2, 4, 7, 9 the median is (4 + 7) / 2 = 5.5.
- Mode = the most frequent value = 8.
- Range = highest minus lowest = 9 - 3 = 6.
The median is not changed by an outlier; the mean is. If the last value were 90, the mean would jump while the median would stay at 6.
Arithmetic and geometric mean. The arithmetic mean averages the returns. The geometric mean gives the true compound rate. A fund that gains 50% one year and loses 50% the next has an arithmetic mean of (50% + (-50%)) / 2 = 0%, but $100 becomes $150 then $75. The geometric mean is the square root of (1.50 x 0.50) minus 1 = square root of 0.75 minus 1 = -13.40% a year. The geometric mean is always at most the arithmetic mean, and the gap grows with volatility.
Standard deviation, calculated by hand
Standard deviation (SD) measures how far returns scatter around their mean. It is the square root of the variance.
Worked example. Four annual returns: 10%, 4%, -2%, 8%.
- Mean = (10 + 4 - 2 + 8) / 4 = 5.
- Deviations from the mean: 5, -1, -7, 3.
- Squared deviations: 25, 1, 49, 9. Sum = 84.
- Population variance (divide by n = 4) = 84 / 4 = 21. SD = square root of 21 = 4.58%.
- Sample variance (divide by n - 1 = 3) = 84 / 3 = 28. SD = square root of 28 = 5.29%.
Use the sample SD when the returns are a sample of a longer record (the usual case for a fund's history); use the population SD when the data are the whole group.
Interpretation. For a roughly normal distribution, about 68% of outcomes fall within one SD of the mean, 95% within two, and 99.7% within three. A fund with a mean return of 8% and an SD of 12% has a 68% range of -4% to 20% and a 95% range of -16% to 32%.
Coefficient of variation = SD / mean, the risk per unit of return. Fund A has mean 8%, SD 12%: 1.50. Fund B has mean 6%, SD 6%: 1.00. Fund B has less risk per unit of return.
Key facts — Descriptive statistics: mean, median, mode, range and standard deviation - Mean is sensitive to outliers; median is not. - Range = highest - lowest. - Population SD divides by n; sample SD divides by n - 1. - About 68%, 95%, 99.7% within 1, 2, 3 SDs for normally distributed returns. - Geometric mean is at most the arithmetic mean.
Exam traps
- Reading SD as a loss measure. It measures dispersion in both directions.
- Using the arithmetic mean to describe multi-year growth.
- A data set can have no mode, or more than one mode.
Covariance, correlation and combined risk
Covariance measures whether two assets tend to move together. Correlation rescales covariance to a number between -1 and +1:
Correlation = covariance(X, Y) / (SD of X x SD of Y)
Worked example. Annual returns of two funds over four years (in percent):
| Year | Fund X | Fund Y |
|---|---|---|
| 1 | 10 | 6 |
| 2 | 4 | 3 |
| 3 | -2 | 5 |
| 4 | 8 | -2 |
| Mean | 5 | 3 |
- Deviations of X: 5, -1, -7, 3. Deviations of Y: 3, 0, 2, -5.
- Products: 5 x 3 = 15; -1 x 0 = 0; -7 x 2 = -14; 3 x -5 = -15. Sum = -14.
- Sample covariance = -14 / 3 = -4.667.
- SD of X (sample) = 5.29 (from the earlier example). Squared deviations of Y: 9, 0, 4, 25 = 38; variance = 38 / 3 = 12.667; SD of Y = 3.56.
- Correlation = -4.667 / (5.29 x 3.56) = -0.248.
The correlation is weakly negative. Combining the funds should reduce portfolio risk.
Why correlation matters: a two-asset portfolio. Portfolio SD is not the weighted average of the SDs. For weights w1 and w2:
SD(portfolio) = square root of [ (w1 x SD1)^2 + (w2 x SD2)^2 + 2 x w1 x w2 x SD1 x SD2 x correlation ]
With 60% in a stock fund (SD 20%) and 40% in a bond fund (SD 10%), correlation 0.3:
- (0.60 x 20)^2 = 144
- (0.40 x 10)^2 = 16
- 2 x 0.60 x 0.40 x 20 x 10 x 0.3 = 28.8
- Variance = 144 + 16 + 28.8 = 188.8. SD = 13.74%.
The weighted average of the SDs is 0.6 x 20 + 0.4 x 10 = 16%. Diversification cut the risk to 13.74%. If the correlation were +1, the portfolio SD would equal 16%, so there would be no diversification benefit. The lower the correlation, the larger the benefit; at -1 risk can be eliminated with the right weights. Diversification reduces unsystematic risk only; it cannot reduce market risk.
R-squared is the square of the correlation with a benchmark: the share of a fund's movement explained by the benchmark. A correlation of 0.9 gives R-squared of 0.81, meaning 81%.
R-squared is usually read together with tracking error, the amount by which a fund's returns deviate from its benchmark's. A high R-squared says the fund moves with the benchmark. A low tracking error says its returns stay close to the benchmark's. An adviser who wants to know how closely a fund follows its index looks at both: R-squared close to 1 (100%) and a small tracking error describe an index-like fund. Sharpe ratio and standard deviation describe risk-adjusted return and volatility, and beta describes sensitivity to the market; none of them measures how closely a fund follows a benchmark.
Key facts — Covariance, correlation and combined risk - Correlation ranges from -1 to +1. Covariance has no fixed range. - Portfolio SD is less than the weighted average SD unless correlation is +1. - R-squared = correlation squared. - R-squared plus tracking error measure how closely a fund follows its benchmark.
Exam traps
- Correlation of zero means no linear relationship, not no risk.
- A negative covariance does not mean negative returns.
- Diversification does not remove systematic risk.
Questions buyers ask
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Yes — the EPUB is for phones and e-readers, the PDF is for printing and tabbing. You get both.
Is a study guide enough for the NASAA Series 66 (Uniform Combined State Law) exam, or do I need a course?
A book is exam review: it does not replace any education, training or experience North American Securities Administrators Association (NASAA) requires before you may sit the exam, so check those requirements first. For the exam content itself, this guide teaches the material chapter by chapter in 193 pages, then prints 1,161 practice questions with answers and explanations, grouped by topic. A prep course adds live instruction and a set schedule; whether you need one beyond any required education is your call.
What is the cheapest way to prepare for the NASAA Series 66 (Uniform Combined State Law) exam?
Start with what costs nothing: 1,161 practice questions on PrepPass, with explanations and no signup. If you want it taught in one file you keep, the full study guide is $24.99 once; the printable cheat sheet for the last days is $9.99. No subscription on any of them.
Who administers the Uniform Combined State Law Examination (Series 66)?
North American Securities Administrators Association (NASAA) — exam delivered by FINRA. A NASAA exam administered by FINRA; NASAA says it is given at Prometric test centers. FINRA: there is no prerequisite, but the Series 7 is a corequisite. NASAA's waiting periods after a failed attempt are 30 days, 30 days, then 180 days; NASAA has announced a shorter wait after a third failed attempt for enrollment windows opened from January 4, 2027.
How many questions are on the Uniform Combined State Law Examination (Series 66)?
110 questions (100 scored, 10 unscored pretest). NASAA's outline (effective June 12, 2023) spreads the 100 scored questions over four topics: 8, 17, 30 and 45 — the largest, 45 (45%), is Laws, Regulations and Guidelines.
How long is the Uniform Combined State Law Examination (Series 66)?
150 minutes
What is the passing score for the Uniform Combined State Law Examination (Series 66)?
73 of 100 correct. 73 of the 100 scored questions; FINRA's page states it as "73/100 correct".
How much does the Uniform Combined State Law Examination (Series 66) cost?
$177 — Exam fee (FINRA, per attempt)
What languages is the Uniform Combined State Law Examination (Series 66) offered in?
English. NASAA: "No, NASAA exams are only available in English." Eligible candidates whose primary language is not English may get extra time through FINRA.
Does the NASAA Series 66 (Uniform Combined State Law) study guide come as a PDF?
Yes — Series 66 — Uniform Combined State Law — Complete Study Guide (2026) downloads as PDF and EPUB, 747 pages in all: 193 pages of teaching plus 1,161 practice questions with answers and explanations. The download link is emailed the moment payment clears and does not expire.
How much does the NASAA Series 66 (Uniform Combined State Law) study guide cost?
$24.99, once. There is no subscription and no account to create; the PDF and EPUB files are yours to keep.
Are there free NASAA Series 66 (Uniform Combined State Law) practice questions?
Yes — 1,161 of them, free to use with no signup and an explanation on every one. This study guide has 1,161 practice questions with answers and explanations. The same free, no-account system also has practice modes (adaptive, new questions, spaced review of misses, weak-topic focus, saved, my mistakes); a timed mock exam (100 questions, 150 minutes) with a score report by topic; a 10-question readiness check (about 5 minutes); 4 study chapters. None of it needs this study guide.
Can I read part of the NASAA Series 66 (Uniform Combined State Law) study guide before buying?
Yes. A full chapter is free to read on this page — not a summary of one, the chapter itself.
What is the difference between the NASAA Series 66 (Uniform Combined State Law) study guide and the cheat sheet?
The study guide ($24.99) teaches the material chapter by chapter and is meant to be read over weeks. The cheat sheet ($9.99, 6 pages) drops the teaching and keeps the figures: every number on the exam grouped by value so the confusable ones sit together, each reference page paired with a recall page that blanks the answers, and four routes by days left — 14, 7, 3, or tonight. They are separate purchases; neither replaces the other.
Is there a cheaper way to buy the NASAA Series 66 (Uniform Combined State Law) study guide with anything else?
Yes. Series 7 + Series 66 is $34.99 for 3 files in one checkout — 41% less than the $59.97 those items cost bought separately today. It adds Series 7 — General Securities Representative Study Guide (2026), NASAA Series 66 — Cheat Sheet (2026). The saving is measured against the items' real current prices; there is no struck-through "original" price on this site.
Is this the official NASAA Series 66 (Uniform Combined State Law) study guide?
No. This is an independent study guide and is not affiliated with or endorsed by the exam's awarding body. It is written from Uniform Securities Act, NASAA test specifications and model rules, and the Investment Advisers Act of 1940. Always confirm current requirements with the body that issues your licence.
Why buy the book when the practice is free?
Our practice questions and timed mock stay free — nothing on the site moves behind this book. The $24.99 book is the studying half: the material itself, taught in order, in a file you own.
- Systematic teaching — every exam section explained chapter by chapter, start to finish, not just questions
- Print it & tab it — a paper-ready PDF you can highlight, mark up, and bring to your study table
- Study anywhere, offline — EPUB on your phone or e-reader; no wifi, no browser tabs
- Everything in one place — the chapters and the practice questions in one file
- Yours for life — one-time $24.99, instant download, no subscription
The details
- Verified from the official source(Uniform Securities Act, NASAA test specifications and model rules, and the Investment Advisers Act of 1940)
- 1,161 free practice questions
A Series 66 prep course runs $400–$800. This book teaches the same exam — same rules, verified to current standards — for a one-time $24.99 you keep for life.
Also free on PrepPass for NASAA Series 66 (Uniform Combined State Law)
Beside this guide, PrepPass has a free study system for the same exam. It needs no account, and buying the guide does not unlock or change it: 1,161 practice questions with explanations; practice modes (adaptive, new questions, spaced review of misses, weak-topic focus, saved, my mistakes); a timed mock exam (100 questions, 150 minutes) with a score report by topic; a 10-question readiness check (about 5 minutes); 4 study chapters.
Progress is saved in your browser; a free account keeps it across devices. The readiness gauge reflects your own practice, not a prediction of the real exam result. How the practice works
One-time purchase, lifetime access to the download. The eBook is the full NASAA Series 66 (Uniform Combined State Law) study guide in PDF and EPUB. Educational summary, not professional or legal advice — always confirm the current rules with the official source. Last updated: October 2026.