FRM Exam Topics and Structure
The FRM exam is administered by GARP. The members of the FRM Committee are from diverse backgrounds having expertise in their risk professions. GARP is responsible to form a committee that includes professionals covering all the aspects of financial risk management. A regular survey is made across different financial and investment industries to synthesize the knowledge and skills that are required inefficient risk management.
Difficulty of FRM Exam
The FRM exams are among the most difficult to crack in Finance. In the past lots of FRM candidates did not clear FRM Part 1 and Part 2 exams in first attempt. Prior to 2009 there was only one FRM exam. After 2009, the FRM exam was split into two parts. GARP made the change to offering one exam at a time, twice a year (May and November). Now during the last 5 years on an average, less than 50% candidates are able to pass FRM part 1 and more than 50% candidates pass the FRM part 2 exam.
Main topics of FRM Exam
FRM part 1
There are 100 MCQs in FRM Part 1 Exam to test the candidate’s knowledge in the areas of risk management, financial markets and products, quantitative analysis and essential risk modelling.
FRM part 2
This part comprises of 80 multiple-choice questions in the areas of market risk, credit risk, operational risk, integrated risk management and current financial market issues
The table below gives a topic-wise weightage of the topic areas covered in FRM exam
| FRM Exam | ||
|---|---|---|
| Topic | Weightage (%) | |
| FRM part 1 | Foundations of Risk Management | 20 |
| Quantitative Analysis | 20 | |
| Financial markets and Products | 30 | |
| Valuation and Risk models | 30 | |
| FRM part 2 | Market Risk | 25 |
| Credit Risk | 25 | |
| Operational Risk | 25 | |
| Risk Management and Investment Management | 15 | |
| Current Issues in Financial markets | 10 | |
Exam Guidelines:
It is important to note that Part I and Part II of the FRM Exam must be passed sequentially. Therefore, while it is possible to sit for both parts of the examination on the same day, candidates must receive a passing score on Part I before GARP will mark their Part II examination. Most candidates elect to take Part 1 and Part 2 on separate Exam administration days.
- There aren’t any penalties for incorrect answers
- If candidates appear for FRM Part I and II at the same time then they have to pass part 1 otherwise exam for part II would NOT be evaluated.
- If you pass part I and fail in part II, you would still get a passing letter for Part I
- The passing score is decided by the FRM Committee
- Only GARP-approved calculators are allowed to be used at the FRM examination
- Exam results are in a binary format, with either pass or fail being awarded
- The results are published in approximately six weeks via email once the examination is run
- Quartile results are provided to the candidates so they can check their performance in the topic areas
FRM Registration Process
The Exam registration fee for FRM is not fixed. It depends on when you register for it. The earlier you make up your mind to take the exam, the lesser you will have to pay.
It has three deadlines and there is a onetime enrollment fee that is a sum of $300. You need to pay the onetime enrollment fee to enroll into the GARP.
| One time enrollment fee (USD) | Registration wise | Fees (USD) |
|---|---|---|
| 300 | Early | 350 |
| Standard | 475 | |
| Final | 650 |
EduPristine is an authorized training provider for FRM Course by GARP. Our world class facility and the level of faculty will never disappoint you throughout the whole process to become a Financial Risk Manager.
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