What is FRM ?

FRM full form is Financial Risk Management that refers to a globally recognised certification awarded by the body of the Global Association Of Risk Professionals (GARP) based in the USA. This qualification equips one with the expertise in managing financial risks across various financial industries and institutions. When the thought of pursuing this credential occurs, candidates often wonder about the course details that FRM entails. Through this blog, we aim to help you understand the FRM’s course duration, factors influencing FRM's course duration, FRM’s course structure, examination pattern, eligibility criteria and various career prospects as all these will help you plan your preparation seamlessly. 

 

FRM Course Duration

FRM course duration varies on many grounds, while the Global Association of Risk Professionals (GARP) recommends 300 hours of study for each Part 1 and Part 2 for full-time students which accounts for about 10 months. Meanwhile, for working professionals, GARP recommends 400 hours of study for each Part 1 and Part 2 estimates to around 14 months. However, on average, it takes about 1 to 2 years to complete your FRM certification. Nonetheless, to acquaint yourself better, let's put forth certain elements that go into the duration of the examination. 

 

Factors Influencing FRM Course Duration

FRM duration depends on various factors that influence it; therefore, it becomes essential for candidates to keep in mind that their journey is different and cannot be compared to the other aspirants. Some of the factors that significantly influence FRM course duration are as follows:

• Educational Background and Work Experience:

If you have prior knowledge or relevant work experience in finance, risk management, or quantitative disciplines, the FRM course material will seem familiar to you, thus reducing the FRM course duration. 

• Availability of Study Time: 

Another factor that profoundly influences the FRM course duration is time and how much it is available for you. If you are a full-time student or a professional with a flexible schedule, you may be able to dedicate more time to studying as compared to those with demanding work hours or personal commitments. 

• Preparation Strategy:

Undoubtedly, for obtaining any qualification, if you approach it with a well-structured study plan and the use of appropriate study materials, the overall duration is significantly impacted. 

• Learning Pace: 

Each individual has their own learning pace and preferred way of grasping concepts; therefore, your learning pace could also influence the overall FRM duration. 

 

FRM Course Structure

As we have discussed what FRM is, its FRM’s course duration and the factors that affect the overall FRM course duration, let's familiarise you with the FRM course details and structure because it'll help you estimate the modules you need to dedicate more time towards or the modules that will take the least of your time. The FRM course is divided into two distinct parts:

Part 1:

Aims to lay a thorough foundation and introduce quantitative tools used in risk management. The key modules included in this part are:

1. Foundations of Risk Management 
2. Quantitative Analysis 
3. Financial Markets and Products 
4. Valuation and Risk Models

Part 2: 

Aims to build upon the prior knowledge of Part 1 and explore more specialised areas of risk management. The fundamental modules included in this part are:

• Market Risk Measurement and Management 
• Credit Risk Measurement and Management 
• Operational and Integrated Risk Management 
• Risk Management and Investment Management 

 

FRM Paper Pattern

Comprehending the FRM course pattern plays a vital role in the FRM course duration, as it'll assist you in planning an effective studying strategy and allocating time for each topic appropriately. The FRM course examination (both parts) is held thrice a year in May, August, and November. 

The following table reflects the FRM course pattern:

Exam Part	Duration	No. Of Questions
Part 1	4 hours	100 MCQs
Part 2	4 hours	100 MCQs

 

FRM Career Prospects: Unlocking Doors in Risk Management

The various lucrative career prospects that the FRM course offers are:

• Risk Manager

• Regulatory Risk Analyst

• Risk specialist

• Chief Risk Officer

• Credit Risk Analyst

• Market Risk Analyst

• Operational Risk Manager

 

Eligibility Criteria of FRM Course

To partake in the various roles that the field of Financial Risk Management (FRM) offers, you must have:

• A relevant bachelor's degree from an accredited institution.
• A minimum of 2 years of relevant work experience concerning areas like risk modelling, risk analysis, risk management, or roles related to financial risk management.
• In case you have a master's degree in a relevant area associated with financial risk management or some aspects of it, then you can apply for the waiver policy of GARP that allows you to have at least one year reduced from your minimum 2-year of work requirement.

We hope this article has provided valuable insights into Financial Risk Management and the FRM course details. While FRM offers rewarding career prospects, if you're seeking a broader scope in finance, consider pursuing the ACCA (Association of Chartered Certified Accountants) qualification. ACCA is globally recognized and offers diverse opportunities in accounting, finance, and business. If you're ready to embark on this journey, explore our ACCA course for comprehensive preparation.

 

Frequently Asked Questions (FAQs) 

Can I complete FRM in 6 months? 

To complete your FRM course, the minimum time it requires is around 9 months to 1 year, and the maximum time demanded is around 1 to 2 years. Since it contains 2 levels, before completing the Level 1 examinations, one cannot attempt Level 2, and in 6 months, you can complete only Level 1, not both levels. Therefore, no, FRM cannot be completed in 6 months.

Is the FRM course difficult? 

The FRM course is considered challenging due to the time it requires to complete its broad and quantitative curriculum. However, if you have a well-structured preparation approach, guidance prior knowledge or work experience in risk management the difficulty level could be minimised significantly. 

Is FRM maths-heavy? 

The FRM maths could come off as demanding, as Part 1 of the examination broadly covers quantitative analysis, valuation models, and risk management techniques that mandate having a strong foundation in areas like statistics, numerical methods and calculus. Nevertheless, with your dedication, the right study material, the learning platform and rigorous practice, the FRM maths could be tackled. 

Which is better CFA or FRM?

Chartered Financial Analyst (CFA) and Financial Risk Manager (FRM) both are well-acknowledged and respected certifications, and they concern different areas in finance. The certification of CFA is suited for those who are inclined towards investment analysis, portfolio management, and asset management. On the other hand, the certification of FRM is more appropriate for those interested in risk management roles. Therefore, the choice depends on your career goals and the domain of finance to which you want to dedicate yourself.