FRM Examination Tips & Guide

FRM Exam Tips Before the Exam

Set Aside Time. Realizing that you don’t have enough time to study all that is necessary is one feeling that
you cannot afford to have. Setting out a time chart showing the exam dates, your work deadlines, personal
and family commitments is a good way to make an assessment of the position that you’re in.

Target Weak Areas. Committing more time to your known weak areas and less time to your strong areas is
always a good thing to do. It is generally better to go into an exam as a more balanced student than being
one-sided in your knowledge.

Make a Calendar. Make markings on a large calendar and clearly write your study goa ls. Show to-do’s,
accomplishments and weak areas that require special focus. Having markings for your work, personal &
family commitments are also important. And show the exam date, time and where it is being held!

Set the Environment. Having a dedicated space that is conducive to concentrated study is also a good
thing to have when preparing for such a challenging exam. Try to get into an area that has as few
distractions as possible (be it visual or audio distractions). Some persons need their space to b e extremely
tidy, some need a certain type of music, and others need to have dead silence. Knowing what works best
for you is key.

Network. There can be several advantages to being part of a study group - you will be able to explain topics
that you are strong in (thus reinforcing your own knowledge) as well as hear from those that are strong in
your weak areas (thus aiding in your understanding of more subjects). If you ever find yourself in a group
that is always going off-course to discuss unrelated matters or simply wasting precious time, then politely
excuse yourself from such persons.

Eat Well & Hydrate. Be very weary of having high-sugar snacks before the exam, as you may feel
energized for an hour-or-so but will have to deal with the energy crash that follows! Have nutritious items
such as nuts, yogurt, bananas etc. that will provide a slow release of energy over a longer time period.
Having plenty of water throughout your study period will also be of benefit to your concentration abilities.

Exercise. Yes, exercise. Many students fall into the trap of saying time is short so they will have to cut
things out such as daily exercise. This is a terrible mistake! Regular exercise will improve the blood -flow to
your brain and through the body, lower stress levels and help you tremendously in concentrating. Whether
it’s going to the gym, walking, jogging or swimming – just do it!

Take Time Off. Everyone is different, but many persons simply cannot study for extremely long periods of
time and still do their regular day-to-day activities adequately. Take time away and do something that will
truly relax your body and mind. Don’t feel guilty about spending a bit of time at the beach in the sun or
sleeping a bit longer than usual over the weekend- having such breaks will almost-certainly rejuvenate your
energy levels.

Practice, Practice, Practice. Going through all the exams available in your text and those available
elsewhere is extremely important. Exposing yourself to the various forms of exam questions will not onl y
inspire confidence internally, but will ensure that you are a bit more settled under real -word exam
conditions.

Sleep. Yes, having a good night’s sleep is one of the critical components of functioning at your peak –
whether it’s for work or school. Having adequate sleep is a great way to lower stress levels and maintain a
mind that is totally refreshed. So, set the alarm clock and sleep well.

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FRM Exam Tips During the Exam
Scan the Paper. It is generally beneficial to have a look-through of the entire paper, making markings of
areas that are completely familiar and simple formulae that you can jot down quickly. This initial scan will
subconsciously focus your mind on those topics that are to be dealt with.

Read The Question Again. A simple request that many will not do. Carefully and slowly reading (and re -
reading) a question then figuring out what exactly is being asked is such an important task that we cannot
over-emphasize it enough.

Secure the Easy Ones. Going through the paper with a view to answer those questions that you are
extremely strong/confident about is normally a good strategy, as, in the event of time running out, this
ensures a securing of points that may make all the difference in the final outcome. This approach will al so
build confidence!

Review Your Paper. Assuming that this is possible, please carefully review all of your paper, even those
that you may be very confident about. Upon reviewing, students may find that they were asked a question
‘in the negative’ (such as… “Which of the following is not allowed…”) and rushed ahead to place its
opposite.

Focus. Do not be concerned about that guy who got up with a smile on his face and walked out of the
exam before everyone else. Do not be concerned about that lady who is as king for a ton of paper to write
things down on. Do not be concerned with what is happening on the outside. Focus on your paper and your
paper alone.

Be Calm. Having unsettled nerves will not help you one bit. Have a good breakfast. Plan the travel route
beforehand and try to arrive at the examination centre with plenty of time to spare. Go to the bathroom one
more time. If possible, sit in a quiet area, close your eyes and clear your mind, not thinking about any
specific topic or question. Avoid persons who are constantly complaining or stressing about the
examination.

FRM Exam Tips After the Exam

Treat Yourself. Regardless of how you feel afterwards, take some time and care for yourself – it may be a
movie, a good book, spending time with a certain person or even playing a video game! Just take some
time away and be happy with your efforts.

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FRM Exam Notables

Exam Type

 Both parts I and II of the FRM Exam are multiple-choice through use of pencil only. Part I is 100
questions (equally weighted). Part II is 80 questions (equally weighted).

Format
Exam Part I: Learn fundamental tools and techniques used in risk management and the theories that underlie
their use. To be completed in 4 hours or less. The focus includes:

 Foundations of risk management concepts

 Quantitative analysis
 Financial markets and products
 Valuation and risk models

Exam Part II: Apply the tools and techniques covered in Part I and dive deeper in investment management and
current market issues. To be completed in 4 hours or less. The focus includes:

 Market risk measurement and management

 Credit risk measurement and management
 Operational and integrated risk management
 Risk management and investment management
 Current issues in financial markets

Pass Rates

 The pass rate for the FRM exam is normally between 40% and 50%.

Z-Table Information

 A standard table presenting the values for the cumulative distribution function (CDF) of the standard
normal distribution (“z-table”) is provided, as is other relevant information pertaining to the CDFs of
other probably distributions (F, chi-square, etc.) where necessary and applicable. Memorization of CDF
values is therefore not expected. A list of common abbreviations used throughout the Exam is also
provided.

Study Time

 As a result of the relatively low pass rates, it is expected that at least 250 hours in study time will be
needed to cover all the material adequately. However, studies show that some candidates logged over
400 hours in preparing for each exam.

Exam Time

 Exams are offered in May and November of each year.

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Exam Locations

 The FRM Exam is offered in approximately 90 sites over the world. You may check the area nearest to
you at www.garp.com

Sitting Frequency

 You may register to sit for both exams on the same day. Please note that part I must be passed before
part II is to be graded.

Allowed Persons

 The FRM exam may be taken by anyone who desires to take it.

Educational Pre -requisites

 There are no educational pre-requisites as the FRM exam may be taken by anyone who desires to take
it.

Language

 The FRM Exam is offered in English.

Fees

 There is an enrolment fee required for each exam. Please visit www.garp.com to see updated fees.

Refunds

 GARP does not provide refunds for either the Exam Enrollment or Exam Registration Fee.

Exam Transfer to another Candidate

 Candidates cannot transfer a registration to another candidate.

Exam Deferrals

 A candidate can defer their Exam registration once to the next Exam date. Second deferrals will not be
considered. A deferral to the next Exam date must be submitted by the last day of registration. There i s
a $100 fee to defer.

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Exam Day Violations
The truth is, a “How to Pass FRM Exam Guide” will be of no use if you do the wrong things on exam day! Below
is a list of violations that have resulted in a candidate’s Exam not being graded.

 Candidate arrived after the doors were closed and continued to sit for the Exam.
 Opened the Exam booklet early.
 Began the Exam before “time to begin” was announced.
 Used a non-approved calculator during the Exam.
 Used a writing instrument that was not GARP issued on the Exam booklet and/or answer sheet (pen,
pencil, or mechanical pencil).
 Candidate possessed erasers, white-out, or correction fluid/tape, highlighters, or rulers.
 Was found with wearable technology devices such as Google glasses, smart -watches, a watch, a fit-bit,
clocks, or portable clocks.
 Wrote on the admission ticket or presented an admission ticket with writing on the back.
 Candidate had in his/her possession a mobile/cell phone.
 Candidate was caught cheating.
 Candidate left with the Exam material(s) and/or admission ticket.
 Continued to write after the proctor announced “stop writing.”
 Candidate communicating with another candidate during the Exam.

Paper admission ticket

 Candidates should not expect to gain admission to the Exam via a smartphone that contains an
electronic copy of their Admission Ticket. A paper Admission Ticket is required for entry to the Exam.
There are no exceptions to this.

Typical Exam Day Schedule

 Once the Exam doors have closed, for both the morning and afternoon session, candidates are not
allowed to enter and sit for the Exam. There are no exceptions to this rule.

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Sections Covered by Exam
The FRM Program is designed to demonstrate your skills and knowledge in financial risk management:

 Part I: Learn fundamental tools and techniques used in risk management and the theories that underlie
their use.
 Part II: Apply the tools and techniques covered in Part I and dive deeper in investment management
and current market issues.

Exam One

 Book 1 – Foundations of risk management concepts

 Book 2 – Quantitative analysis
 Book 3 – Financial markets and products
 Book 4 – Valuation and risk models

Exam Two

 Book 1 – Market risk measurement and management

 Book 2 – Credit risk measurement and management
 Book 3 – Operational and integrated risk management
 Book 4 – Risk management and investment management
 Book 5 – Current issues in financial markets

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