Series 87 — Research Analyst Qualification Examination (Part II) Exam Blueprint

How to Use This Exam Blueprint

Use this checklist as a practical study map for the FINRA Series 87 — Research Analyst Qualification Examination (Part II), official exam code Series 87. The goal is not to memorize isolated rule names. The goal is to recognize what a research analyst, supervisor, compliance reviewer, or member firm may, must, or must not do in realistic research scenarios.

For each topic area, ask:

• Can I identify the regulatory issue quickly?
• Can I distinguish a research report from other communications?
• Can I spot conflicts of interest and required disclosures?
• Can I decide who may review, approve, influence, or distribute research?
• Can I apply restrictions to analyst conduct, public appearances, personal trading, and interactions with investment banking?
• Can I explain the compliance purpose behind the rule?

Exact official weights are not assumed here. Treat the areas below as readiness areas for final review and practice.

Topic-Area Readiness Table

High-Value Definitions to Control

These terms appear repeatedly in Series 87-style scenarios. You do not need only a dictionary definition; you need to know why the classification matters.

Research Report Readiness Checklist

You should be able to review a research communication and answer each question quickly.

Classification

• Is this a research report, market commentary, sales material, internal communication, public appearance, or issuer communication?
• Does it analyze an issuer, security, industry, sector, or investment thesis?
• Does it include an express or implied recommendation?
• Is it intended for distribution to clients, investors, the public, or only internal personnel?
• Is the audience retail, institutional, internal, issuer-facing, or mixed?
• Does the format matter: written report, email, slide deck, model update, call transcript, webcast, social media post, or conference remarks?

Content Standards

• Are statements fair, balanced, and not misleading?
• Are risks disclosed with enough prominence?
• Are assumptions behind projections or price targets clear?
• Is the valuation method or basis for the recommendation explained where relevant?
• Are facts separated from opinions?
• Are material limitations, uncertainties, and conflicts addressed?
• Are ratings or recommendations consistent with the firm’s rating system?
• Are charts, historical performance references, and price targets presented in a way that avoids cherry-picking?

Required Review and Approval

• Has the appropriate supervisory person reviewed or approved the report when required?
• Were legal or compliance personnel involved when conflicts, MNPI, issuer review, or offering-related issues were present?
• Were draft comments limited to permitted purposes?
• Were prohibited reviewers excluded from influencing conclusions?
• Was the final version controlled so that unauthorized changes could not be made after approval?
• Are approval records, drafts, comments, certifications, and disclosures retained as required by firm procedures?

Disclosure Mapping

For each fact in a research scenario, ask whether it creates a disclosure, restriction, or escalation issue.

Conflicts of Interest Checklist

Series 87 scenarios often test whether you can recognize a conflict and choose the right control. A conflict may require disclosure, but some conflicts require more than disclosure.

Can You Spot These Conflicts?

• Investment banking relationship with the subject company
• Expected investment banking compensation
• Analyst participation in soliciting investment banking business
• Firm or affiliate ownership interest in the subject company
• Analyst personal holdings or related-account holdings
• Analyst compensation tied to specific banking transactions
• Pressure from issuer management to improve rating or price target
• Pressure from sales or trading to publish favorable research
• Pressure from large clients or institutional accounts
• Market-making or trading position conflicts
• Research issued around offering-related events
• Selective distribution of research to favored clients
• Inconsistent internal and external views
• Public appearance that omits required conflict information
• Third-party research distributed without appropriate review or disclosure

Conflict Response Matrix

Analyst Independence and Influence Controls

Be ready for questions where the issue is not the final report but the process used to produce it.

Permitted vs. Problematic Conduct

Independence Prompts

• Who benefits if the rating changes?
• Who asked for the change?
• Was the request about factual accuracy or investment conclusion?
• Was compliance involved before information crossed a barrier?
• Was the analyst’s compensation, review, or promotion tied to a banking outcome?
• Was the research timing connected to an offering, pitch, roadshow, or client demand?
• Did anyone outside research receive advance notice of a material change?
• Does documentation show independent analysis?

Prepublication Review Decision Path

Use this decision path when a scenario asks whether a draft report may be reviewed or changed.

    flowchart TD
	    A[Draft research report exists] --> B{Who wants to review it?}
	    B --> C[Research supervisor / legal / compliance]
	    B --> D[Subject company]
	    B --> E[Investment banking / sales / trading]
	    C --> F[Review for supervisory, legal, factual, disclosure, and compliance issues]
	    D --> G{Limited factual review under controls?}
	    G --> H[Yes: route through proper procedures]
	    G --> I[No: improper influence risk]
	    E --> J{Permitted purpose and controlled channel?}
	    J --> K[Yes: document and limit scope]
	    J --> L[No: escalate and prevent influence]
	    F --> M[Finalize approval, certification, disclosures, and records]
	    H --> M
	    K --> M
	    I --> N[Do not publish until resolved]
	    L --> N

Disclosure Readiness Table

Do not study disclosures as a memorized list only. Study the fact pattern that triggers each disclosure or concern.

Regulation AC Readiness

Regulation AC is commonly tested through analyst certification scenarios.

Can You Do This?

• Identify when an analyst certification issue exists.
• Explain that the certification relates to the analyst’s personal views.
• Recognize compensation-related certification issues.
• Distinguish certification from a generic conflict disclosure.
• Spot a problem when research language does not reflect the analyst’s actual view.
• Spot a problem when compensation is directly or indirectly tied to a specific recommendation or view.
• Recognize that certification supports analyst accountability and research independence.

Scenario Cues

Regulation FD, MNPI, and Insider Trading Checklist

A strong Series 87 candidate can stop a scenario at the moment information becomes sensitive.

Material Nonpublic Information Prompts

• Is the information specific enough to affect an investment decision?
• Is it about earnings, guidance, mergers, offerings, credit events, regulatory events, product developments, or management changes?
• Has the information been publicly disseminated?
• Did it come from the issuer, an insider, an investment banking colleague, a client, a consultant, or another restricted source?
• Was the analyst wall-crossed or subject to confidentiality?
• Could publication, trading, or tipping misuse the information?
• Should the security be placed on a restricted list or watch list?
• Should legal/compliance be contacted immediately?

Correct Responses to Potential MNPI

Personal Trading Readiness

Personal trading questions often test timing, access, and conflicts.

Can You Identify the Problem?

• Analyst buys before initiating favorable coverage.
• Analyst sells before publishing a downgrade.
• Analyst’s spouse trades in a covered issuer.
• Analyst trades during a restricted period.
• Analyst trades contrary to the recommendation without required approval or disclosure.
• Analyst receives shares in an issuer connected to research coverage.
• Analyst trades after learning of a pending rating change.
• Analyst uses another account to avoid surveillance.
• Analyst fails to report holdings.
• Analyst claims the trade is allowed because the report has not been published yet.

Personal Trading Decision Questions

Public Appearances and Media Checklist

Series 87 is not limited to written research. Analysts can create regulatory issues in live or informal settings.

Review These Formats

• Television or radio interview
• Webinar or webcast
• Industry conference
• Investor conference call
• Podcast
• Social media post
• Live chat or online forum
• Press interview
• Panel discussion
• Internal call later forwarded externally

Public Appearance Risk Table

Investment Banking Interaction Checklist

Expect scenarios where business pressure is subtle.

High-Risk Interactions

• Analyst attends issuer pitch meeting.
• Analyst promises favorable coverage to help win business.
• Banking asks analyst to delay negative report.
• Banking asks to review a draft before publication.
• Analyst is evaluated by investment banking personnel.
• Analyst compensation is based on a specific banking transaction.
• Issuer complains to banking about an analyst’s rating.
• Banking passes issuer comments to analyst without controls.
• Research is used in marketing an offering.
• Analyst joins roadshow-like activities.
• Analyst receives confidential deal information.

Decision Table

Supervision, Procedures, and Records

The exam may ask for the best firm response, not only the analyst’s personal obligation.

Supervisory Controls to Know

• Written supervisory procedures for research activities
• Principal review and approval where required
• Legal/compliance review for conflicts and sensitive events
• Information barriers between research and investment banking
• Restricted and watch list procedures
• Personal trading surveillance
• Disclosure review and maintenance
• Analyst account and holdings monitoring
• Public appearance tracking
• Third-party research review procedures
• Training and certification processes
• Escalation procedures for MNPI, conflicts, and rule breaches
• Record retention for drafts, approvals, disclosures, certifications, and communications

“Best Supervisory Response” Prompts

When answers look similar, choose the response that:

• Stops ongoing risk.
• Escalates to the right control function.
• Prevents misuse of MNPI.
• Preserves analyst independence.
• Documents the decision.
• Corrects or withdraws misleading communication if necessary.
• Applies firm procedures consistently.
• Avoids relying only on after-the-fact disclosure.

Third-Party Research Checklist

Third-party research questions often test whether a member firm can avoid responsibility by saying, “We did not write it.”

Can You Do This?

• Distinguish internal research from third-party research.
• Identify whether the firm is distributing, adopting, endorsing, or merely making available the research.
• Recognize when review is required before distribution.
• Identify conflicts of the third-party provider.
• Identify conflicts of the distributing firm.
• Determine whether disclosures are needed.
• Spot misleading, incomplete, stale, or inconsistent third-party material.
• Recognize when supervisory procedures should block distribution.

Scenario Cues

Offering-Related and Restricted-Period Judgment

Avoid relying only on memorized timing. The exam can test whether you understand the reason for restrictions: research should not be used to condition the market improperly or support an offering in a conflicted way.

Review Questions

• Is the subject company involved in an offering?
• Is the firm participating in the offering?
• Is the research being issued before, during, or after an offering-related event?
• Is the analyst involved in solicitation, marketing, or roadshow activity?
• Is the report initiating, changing, or reiterating coverage?
• Is the public appearance connected to offering promotion?
• Are there lockup, quiet-period, or other timing restrictions to consider?
• Has compliance approved the timing and content?

Common Exam Pattern

Communications Standards Checklist

Research rules overlap with broader communication principles. A technically complete disclosure does not save a misleading report.

Can You Identify Problems in the Message?

• Exaggerated claims
• Promises or guarantees
• Unsupported price targets
• Selective use of favorable data
• Omission of material risks
• Unclear rating definitions
• Confusing time horizon
• Inconsistent recommendation and narrative
• Unbalanced discussion of upside and downside
• Misleading comparison to peers or indexes
• Stale information presented as current
• Projection without assumptions
• Opinion presented as fact
• Inadequate explanation of conflicts

Fair Presentation Prompts

Scenario and Decision-Point Practice

Use these prompts to test exam judgment.

Scenario 1: Issuer Review

An analyst sends a draft report to issuer management. The issuer corrects a factual error and asks the analyst to remove a negative discussion of margin pressure.

Can you answer?

• Which part of the issuer’s response may be acceptable?
• Which part creates improper influence risk?
• Who should control communications with the issuer?
• What records should be retained?
• Should the analyst change the investment conclusion?

Scenario 2: Banking Pressure

Investment banking tells research that a negative report will harm a pending mandate and asks for a delay.

Can you answer?

• Is the issue content, timing, or both?
• Is disclosure enough?
• Who should be notified?
• What research independence principle is implicated?
• What would be the best supervisory response?

Scenario 3: Analyst Trading

An analyst plans to sell shares of a covered issuer before publishing a downgrade.

Can you answer?

• What makes the trade high risk?
• Does publication status matter?
• What account restrictions may apply?
• Should preclearance resolve the issue automatically?
• What records and escalation are expected?

Scenario 4: Public Interview

An analyst appears on a financial news program and recommends a covered company without mentioning firm conflicts.

Can you answer?

• Is this a public appearance?
• What disclosures may be relevant?
• Is the recommendation subject to fair-presentation standards?
• What if the analyst’s firm has an investment banking relationship?
• What if the analyst owns the stock?

Scenario 5: Possible MNPI

During a private call, issuer management tells the analyst that quarterly earnings will miss expectations. The analyst has not seen the information publicly reported.

Can you answer?

• Is the information potentially material?
• Is it nonpublic?
• Can the analyst publish a downgrade based on it?
• Can the analyst tell the trading desk?
• What is the correct escalation path?

Scenario 6: Third-Party Report

A member firm distributes a favorable report written by an outside provider that is paid by the subject company.

Can you answer?

• Is this third-party research?
• Does the issuer-paid relationship matter?
• What review or disclosure issues arise?
• Can the firm avoid responsibility because it did not write the report?
• Is the communication fair and balanced?

Common Weak Areas and Traps

Artifact and Documentation Checks

Be ready to recognize what records or compliance artifacts should exist.

Rapid “Can You Do This?” Checklist

Before test day, you should be able to do all of the following without notes.

• Define the practical scope of the FINRA Series 87 research analyst rules.
• Identify when a communication is likely a research report.
• Identify when a public statement is a public appearance.
• Spot investment banking conflicts in subtle fact patterns.
• Separate disclosure issues from prohibited-conduct issues.
• Determine when issuer review is limited to factual verification.
• Recognize improper analyst involvement in investment banking solicitation.
• Identify compensation arrangements that threaten independence.
• Apply Regulation AC certification logic.
• Respond correctly to potential MNPI.
• Apply Regulation FD concepts to issuer communications.
• Identify analyst personal trading problems.
• Recognize selective disclosure of pending research.
• Identify required conflict disclosures from scenario facts.
• Evaluate whether a research communication is fair and balanced.
• Recognize when a report’s price target needs a basis and risk explanation.
• Apply public appearance disclosure logic.
• Evaluate third-party research distribution issues.
• Identify supervisory and recordkeeping responsibilities.
• Choose escalation when facts show uncertainty, MNPI, or improper influence.
• Avoid answers that prioritize revenue generation over analyst independence.

Final-Week Review Plan

Five to Seven Days Out

• Rebuild your conflict-disclosure chart from memory.
• Review research report vs. public appearance vs. sales communication distinctions.
• Drill scenarios involving investment banking pressure.
• Drill scenarios involving issuer review of drafts.
• Review analyst compensation and evaluation restrictions.
• Review personal trading restrictions and related-account issues.
• Review Regulation AC and Regulation FD concepts.
• Review MNPI escalation steps.
• Practice mixed questions where more than one issue appears.

Three to Four Days Out

• Work timed sets focused on judgment, not just definitions.
• For each missed question, label the miss: definition, disclosure, restriction, supervision, timing, or MNPI.
• Re-read explanations for questions you answered correctly by guessing.
• Create a one-page list of “stop and escalate” triggers.
• Review public appearance and third-party research scenarios.
• Practice identifying the best supervisory response.

One to Two Days Out

• Stop adding new obscure material unless it fixes a repeated miss.
• Review your error log.
• Memorize your conflict trigger map.
• Review common traps.
• Do a final mixed set under exam-like timing.
• Focus on reading every fact: role, timing, audience, relationship, compensation, ownership, and information source.

Test-Day Mental Checklist

For every scenario, ask:

1. What is the communication or conduct?
2. Who is involved?
3. Is there a research report, recommendation, or public appearance?
4. Is there a conflict?
5. Is disclosure required, or is conduct restricted/prohibited?
6. Is MNPI involved?
7. Is investment banking influencing research?
8. Is analyst trading or compensation involved?
9. Does supervision or recordkeeping appear in the answer choices?
10. Which answer best protects independence, fairness, and compliance?

Practical Next Step

Use this checklist to diagnose weak areas, then practice mixed Series 87 scenarios that force you to choose between disclosure, restriction, escalation, supervision, and documentation. The highest-value practice is not memorizing isolated rule names; it is repeatedly identifying the regulatory issue hidden in the facts and selecting the most compliant response.