Most Frequently Asked Questions About the FRM® Exam

By: Kaplan Schweser
March 7, 2021
Visual representation of woman searching for most frequently asked questions about FRM Exam

If you are considering sitting for the FRM® Exam, you probably have questions. We’ve created this article to answer the most common questions we receive from people who are taking their first steps toward the FRM designation. You’re always welcome to reach out to Schweser’s knowledgeable Student Support team for help as well.

What is the FRM® designation?

FRM is an acronym for Financial Risk Manager. Offered by the Global Association of Risk Professionals (GARP), the FRM certification is recognized as the leading certification for risk managers. Those with the FRM designation are in high demand because of their demonstrated ability to anticipate, respond, and adapt to critical risk issues. The FRM designation lets banks and financial firms know that you take risk management seriously, and your knowledge has been validated by international professional standards.

What is the median salary of a Certified FRM®?

The FRM designation is valued by top employers and recognized globally as the highest standard of achievement in financial risk. As the FRM designation continues to grow, so do its benefits. According to Glassdoor, the average annual salary for financial risk managers in the United States is $101,404. Financial risk analysts earn approximately $56,000. On the top end of the scale are senior financial risk managers or executives, who earn an average of $151,000.

How do I earn the FRM® certification?

To earn the certification, you must take and pass Part I and Part II of the FRM Exam. There are no education or work requirements for taking the exam, but after you pass both parts, you must demonstrate that you’ve had at least two years of full-time work experience in the field of risk. Finance-related vocations are the only ones considered as acceptable work experience. Examples include portfolio management, industry research, trading, and risk consulting.

Considering earning the FRM designation? Download this free Before You Sit for the FRM® Exam eBook.

What is the difference between Parts I and II of the FRM® Exam?

The FRM Exam Part I focuses on the tools used to assess financial risk, and it is always offered in the morning. It has more questions than Part II. Part II focuses on the application of the tools, and it is always offered in the afternoon.

When is the FRM® Exam offered?

There are two parts to the exam. Both Part I and Part II FRM exam windows are in May and November.  View the FRM exam dates to find specific information about each window.

What is the format of the FRM® Exam?

Part I of the FRM Exam is computer-based, with 100 multiple-choice questions. multiple-choice exams; each part is four hours in length. Part I has 100 multiple-choice questions. Part II is also computer-based. The Part II exam has 80 multiple-choice questions. Both Parts of the FRM exam are four hours in length.

What topics are covered in the FRM® Exam?

Part I of the FRM exam tests your knowledge of the tools used for risk management.

FRM Part I Topics and Weights

  • Foundations of risk management (20%)
  • Quantitative analysis (20%)
  • Financial markets and products (30%)
  • Valuation and risk models (30%)

FRM Part II Topics and Weights

FRM Exam Part II topics are based on applying the tools tested in Part I and are weighted as follows:

  • Market risk measurement and management (20%)
  • Operational risk and resiliency (20%)
  • Credit risk measurement and management (20%)
  • Liquidity and treasury risk measurement and management (15%)
  • Risk management and investment management (15%)
  • Current issues in financial markets (10%)

How much time do I need to dedicate to studying for the FRM® Exam?

For each part, you need to study a minimum of 200–240 hours, and you should start studying as soon as you’ve registered. You will be tested on your ability to read a question, analyze it, and apply concepts to it. So cramming in the final weeks before the exam won’t help you. The topics require a type of knowledge that can only be gained over a structured, careful course of study—not last-minute, frantic reviews of core materials.

How hard is the FRM® Exam?

The FRM Exam is very quantitative, and the curriculum takes a lot of time to master. As a result, more people fail Part I than pass it, and barely half of those who take Part II pass it. One reason for this is the variations in the FRM Exam questions.

Some are straightforward, others appear straightforward but have a trick to them, and the wording of still others can be confusing. Therefore, there will undoubtedly be questions on the FRM Exam that give you trouble.

What To Do With Difficult FRM Exam Questions »

Some self-directed and motivated candidates are able to pass both parts of the FRM Exam using a course of self-study, but many use FRM study materials or classes to stay organized and ensure they are prepared for exam day.

What is the FRM® Exam pass rate?

November 2021 pass rates for Part I were 45% and 63% for Part II. You can greatly improve your odds of success by learning from other candidates’ experiences and avoiding common study mistakes.

How much does it cost to sit for the FRM® Exam?

The cost to sit for the FRM Exam varies depending on when you register. Enrollment for the FRM Exam requires a one-time enrollment fee of $400 (USD), due when you register for your first Part I FRM Exam, as well as individual exam registration fees.

Total FRM Program Fees »

What are the next steps?

Are you ready for the next step? Check out our FRM Exam prep study packages, designed for all learning styles. Or, learn more about how to become a certified FRM.

FREE eBook — Before You Decide to Sit for the FRM® Exam

Free eBook — SchweserNotes: FRM® Foundations

Ready to Pass the FRM Exam?