FRM FAQs

Isn’t it wierd when your Friend’s Mother calls you? It is a moment when you start sweating and you cant decide whether to answer her call or not? You start thinking of all the possible ways in which your friend must have messed up and you start building which lie you can tell her this time. Such incident happened with me a few days back.

Today I am going to tell you such weird story of my friend and the reason behind writing this article. My friend, Matt, is going to appear the coming FRM exams and hence is full with anxiety.

But I happened to notice this general anxiety in him. You will get to know his weird habit when you go through the article and see his images.

My reason behind writing this article is to help Matt relax a bit before his Final FRM exam. He has being going nuts thinking about the exam site, exam hours, and study material. So I thought I could write this article based on FRM FAQs which will answer all his queries. Also Matt’s mother had called me and for the first time i did not have to come up with something to save Matt, but actually had to help her.  So if you want to know what was bothering her, read the article and see the conclusion. But I guess you will get the answer once you see the images below.  So let’s go through some general FRM FAQs and the answers for the same.

• General FRM FAQ’s

Why FRM?

The financial industry has seen some tremendous changes and developments over the past few years. And that is why the individuals who are able to manage risks and money at the same time are the need of the hour. So if you want to be amongst them, then the Financial Risk Manager designation is perfect for you. The “FRM” designation is an internationally renowned designation offered by “Global Association of Risk Professionals” (GARP). It is a qualification for risk managing professionals who are involved in analyzing as well as controlling various types of risks like credit risk, market risk, and liquidity risk. So if you are planning to give the FRM examinations, you are on right track.

What is the time duration required for FRM Exam preparation?

Candidates’ preparation times will vary based on their prior experience level, academic record, and understanding of the concepts. Hence the exam preparation time is best dependent on individual efforts. Total preparation time can vary between 300 to 400 hours.

What types of institutions is the FRM applicable to?

FRM degree is related to gaining the practical knowledge needed to function effectively as a financial risk manager globally.

What are the career prospects after Certified FRM?

FRM is the best known, global, and most widely accepted risk management designation in the world. You have to know that the demand for financial risk managers has always being strong. But at the same time your career prospects can vary according to your prior professional experience. Getting a FRM designation will help you differentiate yourself from your peers. It will act as a validation of your knowledge of the tools and techniques of risk management profession.  It is a valued designation by all the companies as well as employers all over the world. You can get employed at-

• Banking institutions
• Government regulating agencies
• Consulting firm
• Financial services institutions.

Is work experience needed before giving FRM Exam?

Yes, you need to have two year professional work experience before giving the FRM examination. But at the same time there is no educational or professional prerequisite to sit for either part of the FRM Exam.

What is GARP, and why is GARP qualified to certify risk managers?

GARP is the “Global Association of Risk Professionals “. It is the only globally recognized professional association for financial and risk certification and education. GARP has been successful in setting up the global standard for the risk profession. It was founded in 1996, is a nonprofit, nonpartisan membership organization of over 150,000 individuals. They develop, design, and administer certification programs that reflect best industry practices.

What is the FRM pass rate?

The historical pass rate is shown in the table below.

On what basis is the Exam score based?

The passing score is determined by the FRM Committee.

• FRM FAQ’s on exam Registration Process

Can I register to sit for the FRM Part I and Part II on different dates?

No. You need to understand that a candidate can only register for FRM Part II exam after they have successfully passed Part I. The other chance is that you will have to register to sit for both parts on the same day.

Can FRM Exam Part I and Part II exam be given on the same day?

Yes, it is possible to appear for both the exams on the same day. Part I exam will be conducted in the morning whereas Part II in the afternoon.

Is it possible to sit for both the ERP Exam and FRM Exam on the same day?

No, since both the exams are conducted at the exact same time, it is impossible for a candidate to sit for both Exams on the same day.

What are the different types of candidates sitting for FRM exam?

Different types of candidates sitting for FRM exam are as follows

• New Candidate

Never registered or sat for the Exam before.

• Returning Candidate

Candidates that have not cleared the earlier exam and who like to retake it again.

• Deferral Candidate

Candidate who has deferred taking the Part I Exam to the next available Exam date and now wants to register for Part I and Part II on the same day.

Being a New Candidate for the FRM Exam Part I, can one defer their registration to the next Exam?

Yes. One can always defer your registration until the last day of registration. However you will need to pay the administrative processing fee. Candidates can defer only once for Part I and once for Part II.

What is GARP, and why is GARP qualified to certify risk managers?

GARP is the “Global Association of Risk Professionals “. It is the only globally recognized professional association for financial and risk certification and education. GARP has been successful in setting up the global standard for the risk profession. It was founded in 1996, is a nonprofit, nonpartisan membership organization of over 150,000 individuals. They develop, design, and administer certification programs that reflect best industry practices.

How do I defer the FRM Exam?

For details about the procedure to defer the exam, you may like to visit the GARP website.

If I defer my Exam test date, is there a time limit on when I need to re-register?

In such case there is no need to re-register. The procedure only postpones your Exam test date to the next available Exam test date. Hence your registration will automatically be made and a confirmation email will be sent to you. If one defers the May Exam, he will be automatically re-registered to sit for the November exam.

Can one register for the FRM Part II Exam before Part I?

No. You have to first complete and pass the FRM Exam Part I in order to register for the FRM Exam Part II. However, one can choose to sit for both FRM Exams Part I and Part II on the same day. But in such case you must first pass Part I before Part II to be graded.

• Enrollment and Registration Fees

What are the fees for the FRM Exams?

The Fee structure is given in detail on the GARP website.

Are the Exam fees refundable?

No. There are no refunds given, nor can the candidates transfer a registration to another candidate. However the candidates can defer their FRM Exam to the following exam date, by paying US$100 administrative processing fee for the deferral.

What does the enrollment fee include?

The enrollment fee includes the costs associated with developing and administering the FRM Program. Also you are entitled with a complimentary one year GARP Individual Membership (a US$195 value). You may also like to know in detail about the Individual Membership benefits.

Do I have to pay an enrollment fee for each part of the FRM Exam?

No. The enrollment fee is for participation in the FRM Program and not to sit for the individual Exams. Candidates pay this fee when they initially register for the FRM Program. However, if the candidate fails to complete the FRM Program within the required 4 year time period after passing Part I, he has to re-enroll in the FRM Program as a New Candidate and pay all applicable fees.

Is the enrollment fee discounted for Individual Member of GARP?

No. The enrollment fee covers the basic costs associated with the program. However, the current Individual membership expiration date will be automatically extended for one additional year, once you pay the enrollment fee.

Does GARP offer scholarships to FRM candidates?

Yes, GARP offers scholarships to full-time students and university faculty taking the FRM Exam Part I only. It is not available for the part II exam.

• FRM FAQs on Exam Sites

Where will the FRM Exam Part I and Part II be offered?

Both the FRM Exam Part I and Part II are conducted at the same Exam sites. You can visit the GARP website to see the sites while you are registering for the exams.

Is it possible to change the Exam site?

Yes. The last day to change your Exam site for the May or November Exams is always the last day of registration.

Is there a fee for changes in the Exam site?

No. There is no fee charged for the change in the Exam site.

• FRM FAQs -Preparing for the  Exam

What kind of study materials are available to help prepare for the FRM Exam?

The study material is given in detail.

Are the Study Guides for the Part I and Part II exam separate?

No, there is only one Study Guide. This will include the syllabus, outline, and recommended reading materials for both FRM Part I and Part II Exams.

Are the study materials for the Part I and Part II Exam separate?

Yes. The study material is tailored according to the FRM Exams.

What topics will be covered in the FRM Exam Part I versus the FRM Exam Part II?

The Pie charts below display the topics as well as their weightage for Part I and Part II FRM exams.

 

What are the total number of questions for FRM Exam Part I and Part II?

The FRM Part I Exam will have 100 multiple choice questions whereas Part II will have 80 multiple choice questions.  

If you are looking for any preparatory course which will help you to prepare for the FRM exam you may like to take a look at FRM level 1 Course.

• FRM FAQs on Sitting for the  Exam

What is the exam duration for both the Parts?

Each Exam will be of 4 hours in duration. Part I exam will be conducted in the morning and Part II in the afternoon.

When will the admission tickets for the FRM Exams be received?

The day when the admission tickets are released will be put on the GARP website. You will also be receiving an email having the instructions on how to download the admission ticket. A paper Admission Ticket is required for entry to the Examination center.

Can the same admission ticket be used for May and November?

No. A new admission ticket will be issued for each Exam date.

Are there two admission tickets if someone has registered for both, Part I and Part II on the same day?

Yes. There are separate admission tickets for Part I and Part II FRM exams.

What languages can one take the Exam in?

The only language that the Exams are directed is in English.

• FRM FAQs on After the  Exam

When is the pass/fail results received?

All the notifications will be displayed on the GARP website. You may like to visit the website whenever any information about the result is displayed.

If someone sits for both the FRM Exam Part I and Part II on the same day, will they receive one or two pass/fail communications?

If you have passed the Part I exam, then you will receive a communication stating whether you have Passed/failed the part II exam. If you have not passed Part I, your Part II will not be graded. In such case you will have to register again for appearing for both the parts.

When the FRM Exam Part I is passed successfully, is re-registration for the FRM Exam Part II required within a certain period of time?

Yes. Once a candidate passes the Part I examination they must then pass the Part II within 4 years. If a candidate fails to do so, they have to re-enroll in the FRM Program as a New Candidate, and have to take Part I again.

After passing FRM Part I exam, can it be included on one’s CV/Resume?

Yes, one can include the following statement on your CV/resume:

“FRM Program – Passed FRM Exam Part I”

Can registration for Part II be done before the results for Part I are announced?

No. Registration can only be done when you have successfully passed Part I.

• FRM FAQs on Work Experience and Certification Process

What is the work experience requirement to become a Certified FRM?

GARP has mentioned in detail the Experience requirements for appearing for the exam.

What is the difference between someone who has passed the FRM Exam and a Certified FRM?

A Certified FRM is the one who has passed the FRM Exam, has met the two years of professional work experience requirement, and has been certified by GARP.

A Person who has passed both parts of the FRM Exam but has not yet met the professional work experience requirement is not considered as a Certified FRM.

When can someone begin using the FRM designation?

The FRM designation can be used only when you have passed both the FRM Part I and Part II exam, met the two years of work experience requirement and have received notification that CV/ resume submission for your FRM Certificate has been reviewed and is complete.

• FRM FAQs on GARP Membership 

Does someone have to be a member of GARP to sit for the FRM Exam?

No. Membership is not required for the FRM Exams. However, you will be automatically provided with complimentary membership privileges for one year once you pay for the enrollment fees in the FRM Program

How much is the GARP’s Individual Membership fee?

The Individual Membership fee is US$195. However, Certified FRMs are offered a discounted membership rate of US$150.

Finally..

I guess we have answered quite a few queries that will help Matt to Calm down before the exams and concentrate on his studies. Lets hope that he does pretty well in it and becomes a qualified Financial Risk Manager. But more than that , i hope that his mother is little relieved and gets some time for herself and does less cooking.

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1. Market Risk Premium
2. Financial Advisor
3. Personal Finance Basics 
4. Finance Certifications for a Professional