FAQ Before Exam FRM exam and study summary

[brunnim]

Overview and Caveats

While the FRM exams are still fresh in my mind I wanted to put some words together which summarizes my experience and hopefully provides some color to future candidates. Each candidate will study and experience the program in a different way, so this is by no means an intended guide or lecture, merely a summary of my experience which hopefully will have some use.

For reference I undertook the Nov 2013 Part I exam and the May 2014 Part II exam. I had been working in the financial industry for 3 years prior to taking the exams.

Knowledge required to take FRM qualification

Do you need to have studied Maths at higher levels (high school) or University to pass the FRM exam?

Answer: NO! When I first looked at the FRM AIMS I was overwhelmed by the number of mathematical topics. This was my biggest fear- my math skills are not up to scratch! I have not studied mathematics in detail since I was 16! I studied Business at University which involved some basic statistical techniques and probability theory, but nothing else. If you are able to rearrange equations, understand basic mathematical symbols and generally work a calculator you can pass these exams. FRM does not require you to derive and continually calculate complex equations. The FRM books contain a number of equations and derivations that are not required for the actual exam and can essentially be ignored. What is challenging is learning the mere quantity of equations, what is actually in them is not overly complex! I really feel people overestimate the level of math skills you require to undertake this exam. Yes you can’t do the exam if you have zero math knowledge but undertaking some basic mathematical primer courses will put you in good stead to study. Don’t forget that you will learn many of the concepts gradually along the way.

Do you need to have a detailed understanding of banking and risk management prior to studying?

Answer: Absolutely not! If you have a basic understanding of how banks and trading works then this will give you a good platform to study. Understanding the basics of credit, market and operational risk will also give you a good base knowledge for studying. This is what you are taking FRM for, to learn these topics so you are not expected to already be proficient in understanding the industry and topics.

Amount of studying and study ethic

Study hours-

Don’t think that you can “wing” it with FRM. Sometimes I would just cram study for certain University exams 2 weeks before. Don’t make that mistake with FRM. If you put the time in to study, you will get the results. There is no magical way to skip parts or cram in studying in a month and pass the exam. Take the time to study. I spent at least 200-300 hours studying for each part.

Given this, my advice is to start reviewing the material as early as possible. You can register 6 months prior to the exam and BT gives you a year of access so why not start early. There is no harm in being prepared. The worst thing you can do is just leave it all till 2 months before the exam. Start early and you have flexibility.

Study ethic-

There are plenty of useful articles on the forum for the method of study, but ultimately you know the way you study best. It was hugely tempting to just forget about studying for a while, go away on that weekend, just have a “few” beers with mates, but being disciplined is key, especially if you are taking the exam whilst in a full time job. The key bonus to being disciplined and dedicating study time is that you save more money because you are in the office or at home.. money that you can generously spend when you pass the exam!

Maximizing the value of Bionic Turtle

The FRM books are overwhelming if used as a sole source of learning. BT offers excellent summary notes and videos that cement the course AIMS. It’s clear to me that I could not have passed FRM without BT. BT has beefed up their notes in recent years as well so arguably you could potentially just rely solely on BT and not even bother buying the official FRM books (I seldom used them in both parts).

However it is worth noting one thing with regards to maximizing the value of Bionic Turtle. The GARP committee will refresh the AIMS on an annual basis at the start of the year. This can sometimes result in 10-25% of the material changing. Unfortunately this means that the BT team must refresh their notes as well. Obviously this does not happen instantaneously and although the BT team makes every effort to produce material, candidates that like to be well prepared may find they don’t have all the available notes for the May exam adequately in advance for studying. The simple solution here is if you want to maximize the value of the BT material, take the exam in November. The AIMS don’t change between May and Nov and in most cases all the BT material will be published for the at least 6 months prior to the Nov exam.

Overall Value of FRM

If anyone is having thoughts about taking the FRM exam and its value to a role in finance/risk I really urge you to take it. I was quite skeptical of the quotes I saw on the GARP website promoting the value of FRM, however now I have taken it I can honestly say my knowledge of financial topics has grown exponentially and I can really see it taking affect already in my work. If you are interested in working in any role that is linked to trading or active risk management, FRM is your baby.

I welcome others to reply to pass on their experiences to future candidates

 

[David Harper CFA FRM]

Wow @brunnim that's just really really helpful and (btw) also really well-written. (Your post prompted me to inquire into adding tagging functionality to our forum, so that we can tag this post for future ease of reference, is how much i think about it!).

I've been asked many times variation(s) "Do you need to have studied Maths at higher levels (high school) or University to pass the FRM exam?" To that questions, I think you've given one of the best answers I've read anywhere. And, I wholeheartedly agree with your answer. But, of course you are addressing the question in the context of what is required to pass the exam.

I would just like to add that merely passing the exam is only one hurdle and, candidly, not my (BT's) highest mission. And the explains we often go deeper on the math. I personally need to be inspired by more than just passing the exam (to take nothing away from your advice, of course) and I am interested in learning more math and, also, new applications (like coding R and applications of code to the concepts), so it's just to say that bionicturtle.com aspires to stand for more than passing an exam. Thank you so much for taking the time to share generously!

 

[m123mikmik]

@brunnim - VERY helpful. Thank you. However, I just want to be EXTREMELY clear I'm understanding terminology and what's expected as I've never taken this before. I've signed up for the first FRM test. Am I correct that all of the study materials for the first test is under Part I: Tools & Theory. The reason I ask is when I logged on to the website I saw a Part I and a Part II. I thought that both of these parts were the study materials for the first test but I'm now under the impression that that is not the case.

Additionally, for the exam it sounds like from the GARP website you will have four hours to answer 100 questions.

Am I understanding this correctly? I believe the term "Part" is what has been throwing me off but I believe to be on track now. If someone could confirm that is the case that would be great.

 

[David Harper CFA FRM]

@m123mikmik "Part" is a specific FRM term defined by GARP (years ago, GARP called them "Levels" is why you occasionally see Level, but Level = Part). Your first exam is Part 1 (= Tools & Theory, which consists of the first four Topics only), which you must pass in order to have Part II (= Applications, which consists of Topics 5 to 9) graded (see http://www.garp.org/frm/exam-overview/exam-format.aspx). Therefore, if your next exam is only Part 1, you will be largely unconcerned with Part II. (Our study plan does structurally show both, it's true .... ). Thanks,

 

[Tipo]

Take the time to study. I spent at least 200-300 hours studying for each part.

Did you do every single practice question? There are way too many practice questions imo. Im planning my schedule before i start and was wondering how should i go about tackling them?

 

[brunnim]

Hi Tipo,

By no means did I attempt every practice question. As you rightfully pointed out there are simply thousands of questions on BT and it would be counterproductive to attempt every one. I tended to stick to the mock exams from both GARP and BT. In fact some of the GARP questions in the real exam were lifted from their practice papers, just with different numbers, so make to look at those. Its good that you plan time to do practice questions into your revision schedule. It can be easy to just get carried away with just raw studying, but ultimately getting comfortable with answering the questions in a timely manner is vital. Do remember though that some of BT's and GARP's past mock questions will be based on material that is no longer in the AIMS, this can be a a little frustrating sometimes because you think "I have clue what this question is referring too!" But broadly the majority of questions are relevant.

Good luck

 

[Tipo]

Hi Tipo,

By no means did I attempt every practice question. As you rightfully pointed out there are simply thousands of questions on BT and it would be counterproductive to attempt every one. I tended to stick to the mock exams from both GARP and BT. In fact some of the GARP questions in the real exam were lifted from their practice papers, just with different numbers, so make to look at those. Its good that you plan time to do practice questions into your revision schedule. It can be easy to just get carried away with just raw studying, but ultimately getting comfortable with answering the questions in a timely manner is vital. Do remember though that some of BT's and GARP's past mock questions will be based on material that is no longer in the AIMS, this can be a a little frustrating sometimes because you think "I have clue what this question is referring too!" But broadly the majority of questions are relevant.

Good luck

Could you share in greater detail your study schedule? Source first?notes? or?etc
I'll be taking P1 in nov

 

[Naziera]

@David Harper CFA FRM CIPM,@brunnim
Dears
Kindly note that i am now in book 3 at topic 28 ,till now i did not solve any question in the bionic turtle ,i repeat the exam twice but this is my first time i use Bionic turtle .Do u recomment to deffer the exam or still is have time ,Appreciate your advise

 

[m123mikmik]

@Naziera - Others may disagree but here are my thoughts. First of all, only you know how quickly you go through the material, what you know and what you don't. How comfortable are you with the remaining sections? Next, how well do you know the material you've already studied? One of the things I've learned the hard way through studying is that I will read the material, think I have a solid understanding of everything and then take practice questions only to realize that I never completely understood it. I may be speaking for myself but taking practice questions is the only real way to gauge whether or not you have an understanding of the material. Hope that helps!

 

[ClaudiaM]

Hi,
I just signed up for FRM exam 1 and will purchase the BT Tier 2 material today. I have a question for those of you who have studied/taken/passed the exam: Do you think BT materials are sufficient to prepare for the exam or is it better to get Schweser or GARP books in addition?

 

[m123mikmik]

Hi @ClaudiaM - I might not be the best person to answer this but I found BT to be more than sufficient for PT 1. I got some Kaplan study tests at the end to mix it up but I found them overly difficult and just trying to trick me as opposed to asking challenging questions. I did find the GARP books VERY helpful though. Question #1 was right out of a GARP practice test (and BT). Starting off the exam 1 for 1 is a great feeling. I didn't ace the exam. I was 2,1,3,2 but I felt very confident going in and felt that I had a good understanding of the material. Hope that helps!

 

[ShaktiRathore]

Hi @ClaudiaM,
I think BT material is more than sufficient. Also visit: https://forum.bionicturtle.com/thre...cturtle-notes-and-garp-books.6106/#post-19165
Thanks

 

[Rf67]

Thanks for your points @brunnim. Aside from some formatting issues / typos I am very impressed with the Bionic Turtle material and will likely use this only (as opposed to GARP + Bionic + supplementary material from other third party providers). I find that the material I have covered so far is not as difficult as I expected, but the sheer quantity of what is required makes it a tough grind. It will likely be a demanding exam (as it should be to make it worthwhile). My concern is GARP increasing the visibility of the FRM certification (I have worked in 2 global banks and neither had heard of FRM (this of course I can only say for the departments I worked in!). I hope in a few years time that the FRM will have the recognition that the CFA enjoys. And that I am a holder!

P.S. For those that are certified FRM holders, do you still pay the GARP fees to remain on the register? If not, why?

Thanks!

 

[frm_risk]

P.S. For those that are certified FRM holders, do you still pay the GARP fees to remain on the register? If not, why?

Thanks!

@Rf67 : Certified FRMs do not need to pay any membership fees to GARP, unlike how CFA charterholders need to pay the CFA Institute annual membership fees to use the designation, at least as of now.

The FRM designation is still not that popular. My guess is that GARP would rather have certified FRMs use the designation to get sort of "free advertising" than charging certified FRMs. I don't know if this will change in the future, but at least as of now, I appreciate GARP's kind gesture to not force certified FRMs to pay annual membership dues to get the right to use the designation.

 

[Natalia13]

I wouldn't say FRM is not popular, there are a lot of job postings saying 'CFA or FRM preferred' at least in NYC metro area and there are a lot of different size companies asking for FRM.
I am also looking at CFA as a possible next certification. What I find interesting is why do you have to pay for the "right to use the designation"? It's like getting your MBA and continue paying for the right to put "MBA" on your CV. I understand Medical Doctors have to pay every two years license fees so they can practice medicine in a particular state and it is law required but I don't get why is it the case with CFA, just curious?

 

[brian.field]

I think it is a revenue play by the issuing entity. I would be very surprised if CFA charterholders are actually paying the fees themselves; rather, I suspect that most employers pick up these fees for their employees with the CFA (or any other) designation.

 

[Rf67]

Overview and Caveats

While the FRM exams are still fresh in my mind I wanted to put some words together which summarizes my experience and hopefully provides some color to future candidates. Each candidate will study and experience the program in a different way, so this is by no means an intended guide or lecture, merely a summary of my experience which hopefully will have some use.

For reference I undertook the Nov 2013 Part I exam and the May 2014 Part II exam. I had been working in the financial industry for 3 years prior to taking the exams.

Knowledge required to take FRM qualification

Do you need to have studied Maths at higher levels (high school) or University to pass the FRM exam?

Answer: NO! When I first looked at the FRM AIMS I was overwhelmed by the number of mathematical topics. This was my biggest fear- my math skills are not up to scratch! I have not studied mathematics in detail since I was 16! I studied Business at University which involved some basic statistical techniques and probability theory, but nothing else. If you are able to rearrange equations, understand basic mathematical symbols and generally work a calculator you can pass these exams. FRM does not require you to derive and continually calculate complex equations. The FRM books contain a number of equations and derivations that are not required for the actual exam and can essentially be ignored. What is challenging is learning the mere quantity of equations, what is actually in them is not overly complex! I really feel people overestimate the level of math skills you require to undertake this exam. Yes you can’t do the exam if you have zero math knowledge but undertaking some basic mathematical primer courses will put you in good stead to study. Don’t forget that you will learn many of the concepts gradually along the way.

Do you need to have a detailed understanding of banking and risk management prior to studying?

Answer: Absolutely not! If you have a basic understanding of how banks and trading works then this will give you a good platform to study. Understanding the basics of credit, market and operational risk will also give you a good base knowledge for studying. This is what you are taking FRM for, to learn these topics so you are not expected to already be proficient in understanding the industry and topics.

Amount of studying and study ethic

Study hours-

Don’t think that you can “wing” it with FRM. Sometimes I would just cram study for certain University exams 2 weeks before. Don’t make that mistake with FRM. If you put the time in to study, you will get the results. There is no magical way to skip parts or cram in studying in a month and pass the exam. Take the time to study. I spent at least 200-300 hours studying for each part.

Given this, my advice is to start reviewing the material as early as possible. You can register 6 months prior to the exam and BT gives you a year of access so why not start early. There is no harm in being prepared. The worst thing you can do is just leave it all till 2 months before the exam. Start early and you have flexibility.

Study ethic-

There are plenty of useful articles on the forum for the method of study, but ultimately you know the way you study best. It was hugely tempting to just forget about studying for a while, go away on that weekend, just have a “few” beers with mates, but being disciplined is key, especially if you are taking the exam whilst in a full time job. The key bonus to being disciplined and dedicating study time is that you save more money because you are in the office or at home.. money that you can generously spend when you pass the exam!

Maximizing the value of Bionic Turtle

The FRM books are overwhelming if used as a sole source of learning. BT offers excellent summary notes and videos that cement the course AIMS. It’s clear to me that I could not have passed FRM without BT. BT has beefed up their notes in recent years as well so arguably you could potentially just rely solely on BT and not even bother buying the official FRM books (I seldom used them in both parts).

However it is worth noting one thing with regards to maximizing the value of Bionic Turtle. The GARP committee will refresh the AIMS on an annual basis at the start of the year. This can sometimes result in 10-25% of the material changing. Unfortunately this means that the BT team must refresh their notes as well. Obviously this does not happen instantaneously and although the BT team makes every effort to produce material, candidates that like to be well prepared may find they don’t have all the available notes for the May exam adequately in advance for studying. The simple solution here is if you want to maximize the value of the BT material, take the exam in November. The AIMS don’t change between May and Nov and in most cases all the BT material will be published for the at least 6 months prior to the Nov exam.

Overall Value of FRM

If anyone is having thoughts about taking the FRM exam and its value to a role in finance/risk I really urge you to take it. I was quite skeptical of the quotes I saw on the GARP website promoting the value of FRM, however now I have taken it I can honestly say my knowledge of financial topics has grown exponentially and I can really see it taking affect already in my work. If you are interested in working in any role that is linked to trading or active risk management, FRM is your baby.

I welcome others to reply to pass on their experiences to future candidates

Are there any particular readings / topics I should be paying special attention to? (For part 1 exam)

Thanks

 

[ShaktiRathore]

Hi
Yes you have to pay equal attention to all the readings. There is no favorite topics for Frm exam that shall carry extra weights. In quant analysis i think all the readings are important,in foundations too, in fin mkts and products everything u need to study i mean u should know every product, and also in valuation u should cover all topics. All readings are i think important. Question can come from anywhere.
Thanks

 

[brian.field]

While I agree with Shakti here, (and you will soon find that he is virtually always right,) I would also remind you that GARP provides weightings.

For example, for Part I, Foundations is 20%, Quantitative Analysis is 20%, Financial Market and Products is 30%, and Valuation and Risk Models is 30%.

This is a pretty clear indication of where you should focus your energy.

Brian