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FRM Part 1 Syllabus

The FRM Part 1 exam is considered among the hardest to crack in finance. There are 100 MCQs to test the candidates’ knowledge in the areas of risk management, financial markets and products, quantitative analysis and essential risk modelling. Before talking about the FRM Part 1 Syllabus in detail, let us take a look at the format of the FRM Part 1 Exam.

FRM Part 1 Exam Format

FRM Part 1 Exam is a paper-based exam consisting of multiple choice questions with 4 answer choices. It is conducted only in English language across 90 testing locations worldwide. The FRM part 1 and part 2 exams are offered on third Saturday in the months of May and November.

The duration of the FRM exam is 4 hours. There are 100 multiple choice questions in FRM part 1 exam. FRM part 1 exam is conducted in the morning session.

There is no negative marking for wrong answers. The FRM part 2 exam is not graded until the candidate qualifies FRM part 1 exam. The FRM Committee is responsible for determining the passing score.

Candidates are allowed to make use of the GARP approved calculators. Only certain models of Hewlett Packard (10B II, 20B, and HP-12C) and Texas Instruments (BA II Plus) calculators are permissible. If there is a violation to this rule, then the answer sheet will not be evaluated and graded.

FRM Part 1 Exam- Topic-wise weightage

There are 100 MCQs to test the candidates’ knowledge in the areas of risk management, financial markets and products, quantitative analysis and essential risk modelling. The table below gives a topic-wise weightage of the topic areas covered in FRM part 1 exam.

Topic Weight

Foundations of Risk Management


Quantitative Analysis


Financial markets and Products


Valuation and Risk models


The detailed topic wise syllabus for FRM Part 1 Exam is given in the following table:


• The role of risk management

• Basic risk types, measurement and management tools

• Creating value with risk management

• Modern Portfolio Theory (MPT)

• Standard and non-standard forms of the Capital Asset Pricing Model (CAPM)

• Single and multi-index models and the Arbitrage Pricing Theory (APT)

• Risk-adjusted performance measurement

• Enterprise Risk Management

• Financial disasters and risk management failures

• Case studies

• Ethics and the GARP Code of Conduct


• Discrete and continuous probability distributions

• Population and sample statistics

• Statistical inference and hypothesis testing

• Estimating the parameters of distributions

• Graphical representation of statistical relationships

• Linear regression with single and multiple regressors

• The Ordinary Least Squares (OLS) method

• Interpreting and using regression coefficients, the t-statistic, and other output

• Hypothesis testing and confidence intervals

• Monte Carlo Methods

• Estimating correlation and volatility using EWMA and GARCH models

• Volatility term structures

• Quantifying volatility in VaR models


• Mechanics of OTC and exchange markets

• Forwards, futures, swaps and options

• Mechanics

• Pricing and factors that affect it

• Uses in hedging and hedging strategies

• Delivery options

• Interest rates and measures of interest rate sensitivity

• Derivatives on fixed income securities, interest rates, foreign exchange, and equities

• Commodity derivatives

• Foreign exchange risk

• Corporate bonds


• Value-at-Risk (VaR)

• Applied to stock, currencies, and commodities

• Applied to linear and non-linear derivatives

• Applied to fixed income securities with embedded options

• Structured Monte Carlo, stress testing, and scenario analysis

• Extending VaR to operational risk

• Limitations as a risk measure

• Coherent risk measures

• Option valuation

• Pricing options using binomial trees

• The Black-Scholes-Merton Model

• The “Greeks”

• Fixed income valuation

• Discount factors, spot rates, forward rates, and yield to maturity

• Arbitrage and the Law of One Price

• One factor measures of price sensitivity

• Country and sovereign risk models and management

• Fundamental analysis

• External and internal credit ratings

• Expected and unexpected losses

• Operational risk

• Stress testing and scenario analysis


Global Association of Risk Professionals, Inc. (GARP®) does not endorse, promote, review or warrant the accuracy of the products or services offered by EduPristine for FRM® related information, nor does it endorse any pass rates claimed by the provider. Further, GARP® is not responsible for any fees or costs paid by the user to EduPristine nor is GARP® responsible for any fees or costs of any person or entity providing any services to EduPristine Study Program. FRM®, GARP® and Global Association of Risk Professionals®, are trademarks owned by the Global Association of Risk Professionals, Inc

CFA Institute does not endorse, promote, or warrant the accuracy or quality of the products or services offered by EduPristine. CFA Institute, CFA®, Claritas® and Chartered Financial Analyst® are trademarks owned by CFA Institute.

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