Everything You Need to Know About the FRM Exam: Pattern, Registration & Dates

One of the most valued and globally recognized certifications that a finance student or professional can receive is the Financial Risk Manager (FRM) certification. The exam, which is conducted, justifies its prestige with its difficulty while it tests your understanding of concepts like market risk, credit risk, operational risk, liquidity risk, and financial risk modeling. Millions of students enroll for this exam, out of which many give it for the first time. For them all, the first step of cracking this exam is understanding the exam structure, dates, syllabus, and registration process, along with how rewarding it is.

What is the FRM Exam?

The FRM exam is a globally recognized exam conducted by GARP to analyze the expertise of students across the world in financial risk management. The exam is conducted in two parts, namely Part I and Part II. Due to the difficulty of the exam topics, many students depend on the preparation offered by the best online FRM course in India rather than self-study. This difficulty is why it should not be underestimated and is considered suitable for:

• Finance graduates looking to occupy risk management roles
• Professionals in banking or financial roles
• Experts from other domains transitioning into finance

FRM Exam Pattern

The two parts of the FRM among the FRM exam details are important to know about. Both of them are conducted in the form of computer-based MCQ exams and focus on different concepts. The FRM Part I in the FRM exam pattern tests your knowledge of foundational risk concepts and quantitative tools. 

Meanwhile, the FRM Part II highlights the importance of advanced risk applications and real-world case-based understanding. Only after passing Part I is your Part II graded. To clear both exams, students are recommended to dedicate 240 to 300 hours to their studies. 

FRM Part I

The FRM Part 1 consists of 100 MCQs that emphasize the knowledge of probability, statistics, time value of money, regression analysis, fixed income, and derivatives pricing basics. The major topics you will find in its syllabus, with the FRM course explained, are:

• Foundations of Risk Management (20% weightage)
• Quantitative Analysis (20% weightage)
• Financial Markets and Products (30% weightage)
• Valuation and Risk Models (30% weightage)

FRM Part II

While the FRM Part I tests your theoretical knowledge of concepts, the FRM Part II syllabus is made to analyze your knowledge in applications of concepts with 80 MCQs. This part tests Value at Risk (VaR) models, basel frameworks, stress testing, credit derivatives, and enterprise risk management. The core topics of this part include:

• Market Risk (20% weightage)
• Credit Risk (20% weightage)
• Operational Risk (20% weightage)
• Liquidity Risk (15% weightage)
• Investment Management (15% weightage)
• Current Issues (10% weightage)

How are the FRM Exam Marks Shown?

For the FRM exam, marks are not evaluated on a scaling system. Rather, students get the results in the form of a pass or fail declaration and quartile performance (1 to 4) in each topic area. Here, quartile 1 indicates that you scored among the top 25% among all who appeared for the exam, while quartile 4 categorizes your result in the lowest 25% of students. The FRM pass rates for both exams are:

• Part I: 47%
• Part II: 56%

FRM Exam Dates

Both parts of the FRM exam are conducted in different phases throughout the year. While they occur in fixed months, the exact date for the exams changes every year. Knowing these dates helps you, as an aspirant, calculate how much time you have remaining to prepare, along with when to register for those exams. 

How to Register for the FRM Exam?

Registering for the FRM exam is an easy process that involves creating your account on the GARP website, enrolling in the FRM program, paying the enrollment and exam fees, and selecting the preferred exam window and location you find suitable to appear for. The following is the step-by-step FRM registration process:

• Create a GARP account on the official website of GARP
• Enroll in the FRM program
• Select Part I or Part II to appear for 
• Choose your desired exam time window and location
• Pay the exam fees
• Process ends when you receive the confirmation email

FRM Exam Fees

The total cost associated with FRM typically includes the one-time enrollment fee for new candidates and the exam registration fee, which varies by the phase of registration. What could be added to the two is a possible late registration fee. The overall cost of the program includes:

• One-time enrollment fee: $400 for new candidates only
• Early registration fee: $600 per part
• Standard registration fee: $800 per part

FRM Eligibility Criteria

Unlike other professional exams, the FRM eligibility criteria ask for no previous specific educational qualification to register for this exam. The only eligibility requirement to award the certification is:

• You must clear the FRM Part II after Part I.
• You must have two years of relevant full-time work experience in financial risk management or related areas within the specific time frame set by GARP.
• Candidates who hold a master’s degree in relevant areas need only one year of work experience to get the certification.

Conclusion

The FRM exam is a globally recognized certification conducted by GARP, whose two parts are considered very difficult to clear by people across the globe. However, with the right understanding of the syllabus of the exam, weightage of the topics, and by following the right preparation strategy aligned with the exam date, cracking the exam and gaining this qualification is sure to become relatively easier for you.

To boost your preparation as well as your chances of clearing the FRM exam, enroll at Fintelligents, the approved education provider of FRM, for offline or online batches of coaching.

FAQs

Q. Can I take FRM 1 and 2 together?

Yes, you can give the FRM I and II in the same year or in the same month, even on the same date in August. However, you need to clear the FRM Part I to have the Part II graded.

Q. How long does it take to study for FRM?

For the FRM exam, it is recommended that you spend 240 to 300 hours studying for each part.

Q. What are the requirements for the FRM exam?

There are no requirements to give the FRM Part I and Part II exams. However, to gain the official FRM certification, you need to show two years of work experience within five years of passing Part II. If you hold a master’s degree in a relevant domain, you need to only show one year of work experience.