FRM Exam: Our Epic Financial Risk Manager Guide

Want to pass your exams? Start preparing the right way.
My email is and I'm preparing for

Wondering what the FRM certification all about?

If you’re keen on a career in risk management, consider the FRM exams by the Global Association of Risk Professionals (GARP): a two-part, self study set of examinations with global recognition. 

This comprehensive guide is packed with the latest information that will aid your decision making on this qualification. Let’s take a look!


Overview of FRM

Since the inception of FRM program in 1997, more than 71,546 certified Financial Risk Managers have successfully obtained the designation.

They are employed internationally at nearly every major bank, asset management firms, hedge funds, consulting firms, and regulators.

number of FRM candidate registrations since 2010

There is fast-growing demand for the Financial Risk Manager certification. 

FRM exam registrations have grown by an average of 12% per year since 2010, registering a growth of 20% in 2017-2018 alone. The 2020 figures were impacted by the pandemic, and are expected to recover.


What is FRM exam?

What is the FRM Exam? A Quick Overview

The FRM exam is a two-part computer-based examination consisting of a 4 hour multiple choice exam each. Its difficulty is equivalent to a Master’s degree, according to benchmarking done by UK NARIC (National Academic Recognition Information Centre of the United Kingdom).

There are 3 exam windows for Part 1 (May, July and November), and 2 exam windows for Part 2 (May and December) annually.

Candidates can still take both Parts on the same day, but you will need to pass Part 1 before Part 2 is scored.

The exams are conducted exclusively in English, in person at 100+ exam sites around the world. You can find out your nearest exam center here.

In terms of pass criteria, there are no negative markings for incorrect answers. The passing score is determined by the exam committee each year.

The exam results are sent to candidates via email approximately 8 weeks after the conduct of exam, and result is a simple pass or fail.

However, you will be provided with quartile results so that you can see how you scored on specific areas relative to other candidates.


FRM pass rates since 2010

FRM Exam: Our Epic Financial Risk Manager Guide 1

The latest May 2021 exam recorded pass rates of 47% (Part 1) and 59% (Part 2).

Check out our FRM pass rates article for a gauge of difficulty of the exams.


Exam topics & weightings

frm

FRM part 1 topics

​The Part 1 curriculum covers the tools used to assess financial risk. The topics and percentages are as below:

Part 1 Topic AreasTopic Weight
Foundations of Risk Management (FRM)20%
Quantitative Analysis (QA)20%
​Financial Markets & Products (FMP)30%
Valuation & Risk Models (VRM)30%

FRM part 2 topics

​The Part 2 curriculum highlights on the application of the tools studied in Part 1 with a deeper understanding of risk types and risk management. Topics and percentages are in the table below: ​

Part 2 Topic AreasTopic Weight
Market Risk Measurement & Management (MR)20%
Credit Risk Measurement & Management (CR) ​20%
Operation Risk & Resiliency (ORR)20%
​Liquidity and Treasury Risk Measurement and Management (LTR)15%
​Risk Management and Investment Management (IM)15%
Current Issues in Financial Markets (CI)10%

Fees and cost

wallet

There is a recent increase in FRM exam fees due to the transition to computer-based exams. Here are the latest costs:​

Fees in USD ($)Part 1Part 2
Enrollment​ (one-off)$400
Early Registration$550$550
Standard Registration$750$750

There is a one-off enrollment fee of $400 that applies to first time candidates. For example, if you’re retaking Part 1 exams, the exam fee varies between $550-$750 only depending on your registration date.

The fees for Part 2 candidates are the same as Part 1 (excluding the one-off enrollment fee), ranging from $550-$750 depending on registration date. 

That said, registration fees are only one part of the costs of Financial Risk Manager exams. Check out our FRM fees summary for a more thorough estimate of total cost, including FRM courses.


Exam dates and registration deadlines

frm exam dates

For the latest exam registration dates and deadlines, check out our FRM exam dates summary.


What are the FRM exam requirements?

FRM Exam: Our Epic Financial Risk Manager Guide 2

In order to be certified as a Financial Risk Manager and be able to use the FRM designation after your name, the following conditions must be fulfilled:

  • Pass FRM Part 1;
  • Pass FRM Part 2 within 4 years of passing Part 1; and
  • Demonstrate 2 years of professional full-time financial risk management work experience.

FRM work experience requirements:

  • To demonstrate relevant work experience, GARP requires a candidate submission of a minimum of 4-5 sentences (at least 300 words) detailing how he/she manages financial risk in their day-to-day work.
  • Experience completed for school will not be considered, including internships, part-time jobs, or student teaching.
  • The work experience submitted cannot be more than 10 years prior to having passed the Part 2 exam.

There are time limits to getting certified as a Financial Risk Manager:

  • Once a candidate passes Part 1, he/she must then pass the Part 2 within 4 years.
  • Then, the candidate will have 5 years from the date of passing Part 2 exams to obtain work experience verification. If this is not done in time, the candidate will have to re-enroll and pass both Part 1 and Part 2 exams again for certification, not to mention re-paying the required fees to do so.

Benefits of FRM certification

Financial Risk Managers are one of the most widely accepted global designation for risk management profession, and getting this certification certainly sets you apart from the rest.

Once you achieve this designation, you can expect to:

  • Differentiate yourself and further boost your risk management credentials in the financial industry
  • Enhance career growth and increase job mobility in the risk management sector
  • Become a part of the global elite group of risk management professionals who are certified as Financial Risk Managers
  • Be recognized globally as a leader in financial risk management
  • Command better remuneration package and job opportunities

FRM vs CFA – Which is right for you?

cfa vs frm

This is a popular topic which has a whole article in itself.

We compare the differences and similarities between these designations, in terms of syllabus, difficulty and career objectives. Check it out!


Are you considering this certification, as well as the CFA designation? Leave a comment below!

Meanwhile, you may find these related articles of interest:

blog1

38 thoughts on “FRM Exam: Our Epic Financial Risk Manager Guide”

  1. Please send me details about how the study materials for this course are to be purchased and from where.

    Reply
  2. Hello,

    Are there any free resources / guides for FRM Part 1 and Part 2 exams ? Please share if you have any ?

    Thanks,

    Reply
    • Hi Sundar! What particular free resources and guides are you looking for?

      To start, we have adapted our CFA study planner for FRM study plans as well. Just fill in the form at the bottom of the article, select FRM and whether you’re Part 1 or Part 2, then click ‘Next’. 🙂

      Reply
      • Sure Sophie, I did’t knew how CFA study planner is going to help me in preparing FRM exams. Hence, I was looking for FRM specific resources.

        Reply
        • Hi Sundar, what I meant was that we created a separate FRM study planner as well, just haven’t broadly advertised it yet, hence it’s accessible only from that link.

          Reply
          • Hello Sophie,

            Sorry, I could not find this form / link which you mentioned earlier”…Just fill in the form at the bottom of the article, select FRM and whether you’re Part 1 or Part 2, then click ‘Next’…” – please help me locate this.

            Thanks,
            Sundar.

  3. Hyy, i am doing my fy.bcom.so when my graduation complets and I do Frm only so can I get a job in this field or I do some else?

    Reply
    • Hi Dave, getting an FRM certification doesn’t guarantee a job in the field. It does improve your prospects for a financial risk management job, but it also depends on your job application and interview process.

      Reply
  4. Hi, myself Santosh, i am a commerce graduate with 15 years of experience in Finance and accounts field. since 2017 i have been working under GRC (Governance Risk & compliance). If i take FRM along with my job, after completion of both the parts can i apply for the certification with this experiance.

    Reply
  5. Hi I am an FYBBA a student And want to make career in Finance I am willing to do both CFA+FRM so can you please suggest when to start and from where to start.

    Reply
  6. Hi! So, if while I am completing my Exam 1 and 2 I work full-time job related to financial risk manager, once I finish Exam 2 can I get the FRM certification?

    Or does the work experience start once you finish Exam 2?

    Thanks!

    Reply
    • Hi Marc, if you refer to the work experience section in this guide above, you’ll see that the 2 years work experience “cannot be more than 10 years prior to having passed the Part 2 exam”.

      So you should be able to get your FRM certification once you passed Part 2 and showed that your 2 year work experience is relevant (and not more than 10 years prior to passing Part 2).

      Reply
  7. Hello;
    I am currently working as Manager Operational Risk & Business Continuity Planning from last 6 years and now interested in FRM; going to register my self for upcoming exam.
    Is FRM is OK for me or not ?
    I have also plan to move in Canada by end of this year; please advice….

    Reply
  8. If some is having 10 years of experience. Is he eligible for FRM 2. As per the guidelines, he is not eligible.

    Reply
    • Hi Vishesh, think you may have misunderstood the FRM work experience requirements here: A candidate needs to show 2 years of professional full-time financial risk management work experience. And this work experience submitted cannot be more than 10 years PRIOR to having passed the Part 2 exam. So if someone has 10 years of relevant risk management experience (say from 2010-2020) before passing Part 2 exams in 2020, that is fine, because it is more than the 2 years required. However, say if you passed FRM Part 2 in 2020, but the last time your relevant risk management experience was from 2000-2011, that would NOT qualify even though you had 11 years risk management experience previously, as for FRM work experience purposes, you only have 1 year relevant experience since they do not count work experiences more than 10 years PRIOR to passing FRM Part 2. Hope this is clear!

      Reply
  9. Thank you so much for sharing this Sophie. It was very informative and answered several of my questions. Thanks a ton!

    Reply
  10. I am MCA and having 10 yrs exp. and in murex(Amrket risk and credit risk reorts in datamart) development 5 yrs in it .can i do FRM

    Reply

Leave a Comment

Get our free guides: subscribers are 16% more likely to pass.

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.