Re: FRM preparation

[eddfung]

Hi David,

I wish I'd come to your website before enrolling the exam. I picked the full version because it seemed it was less troublesome to sit in two levels in two dates. Having read the discussion in the forum, I can feel that the course has expanded its coverage significantly. The best I can do is to start early and to get well-prepared. ( I was fooled by my co-worker who said passing FRM was not difficult as the exam setting was not designed to fail you like CFA. Maybe he was correct back in seven years ago when he took his, but definitely is not the case now. Look like CFA level4 to me!)

My questions are as follows:
As you know, the readings list is so huge. Budget and time are always a problem to the candidates except to those sponsored by the employer. (The exam already costs me $550 and handbook another 100-something. If adding the cost of your notes and core readings, the total cost will be $2000!) How sufficient will it be if I primarily rely on your notes?

If not, will reading both the handbook and notes will a good alternative? Any suggestions on the must-read articles/readings in the syllabus?

How valid the 2007 handbook is for the 2009 exam? My feeling is that the fundamentals like stats, fixed income, derivatives should not change a lot, should be a good reference but subjects like credit risk and ops risk may be totally different today. I am less willing to buy the 2009 copy too. Any tips where I should beware of the recent changes or insufficiency when I go through the handbook?

You can see that I am tight in the budget trying to save every penny. Will you offer the $100 discount to those who bought the handbook or readings list from the GARP?

I can understand that it takes time for you to revise the notes to fit into the 2009 syllabus. if I join the premium service now, will I be able to go through the notes & materials that you posted in 2008?

Thank you so much for offering this forum to all the candidates. I can see that you have a bigger goal than other commercial course-providers!

With best wishes,

eddfung

 

[troubleshooter]

This a good post. I wanted to know some of things myself.

 

[David Harper CFA FRM]

Hi eddfung,

Thanks for liking the forum and sharing your (thoughtful) perspective.

"...I can feel that the course has expanded its coverage significantly."

By my count, from 2008, 53 readings were added (some quite dense) and 21 substracted for a net addition of 32 readings. Clearly, the full test has expanded significantly. (figure +30% if they were equally weighted). I hope you noticed this XLS prepared by a former customer, Simoen Fishman which gives excellent detail.

"...my co-worker who said passing FRM was not difficult as the exam setting was not designed to fail you like CFA."
Yea, i don't agree with that. Pass rates have generally been 40-45%. I'd rather say the FRM is nearer to being designed to fail you, in the sense that it is difficult and a bit unpredictable (mostly in a good way)

"....the total cost will be $2000!"
Yikes, I hadn't quite punched the numbers that way. Does anybody want to start an open-source certification? I'm serious. (Please contact me at .(JavaScript must be enabled to view this email address) if you want to discuss this. Certification is ripe for "innovative disruption;" i.e., what's exam administration aside from a reading list and logistics?).

"How sufficient will it be if I primarily rely on your notes?"
In the forum I advise reading the source notes. I have three motivations for doing so, in order from selfish to alturistic:
1. (selfish) My emphasis are video tutorials (and PPT as flashcards) - I'll never be in the business of making large notes: at a certain point, they are roughly equivalent to the source anyway! Bluntly, Schweser has better notes than me...It frankly suprises me that a few customers wrote here than mine are better (I guess I'd have to disagree!). I do use graphics, but they are outlines. I could spend more time on notes, but I prefer to devote the extra time to where I am unique (videos, XLS) and the learning is more efffective.
2. (selfish) Because reading the source increases the odds of passing. Predicting pass/fail cannot be done generally, it is individual-specific. Passing is a function of (i) preparation and (ii) capability [skill, experience]. It's a kind of (selfish) hedge for me, to insist you read the notes, because I want the high pass rates and high customer satisfaction. And people vary. Some can pass with amazingly little help; others require much redundant exposure.
3. (not selfish) I like most of source authors, I helped select some of the readings (this year). When I sat for the FRM (long ago), it wasn't to get the certification, it was to impose a reading list on myself. So, I'm a fan of the savoring the source material.

"How sufficient will it be if I primarily rely on your notes?"
Combined with the outline notes, I do intend for the total BT program to be *sufficient* to pass the exam without the source notes.
Many customers have passed using only my materials and many will continue to do so. But individuals vary. Some require a lot of help. So, IMO, it is irresponsible of me or anyone to advise generally to skip the source, lacking knowledge about individual capabilities. I fear this will encourage spending less time than is needed.

Does this make sense? I have many customers who pass using only my materials. But given the difficulty of the exam, I just don't recommend this as a general rule...

"If not, will reading both the handbook"
Cannot answer this until we see (i) the AIMs/learning outcomes and (ii) the 2009 FRM Handbook (5th Edition)

"Any suggestions on the must-read articles/readings in the syllabus?"
I have already started working on this...not ready to share...I understand this is a useful question, indeed. I intend to provide prioritzation help.

"How valid the 2007 handbook is for the 2009 exam?"
Did you know the handbook will be updated? Haven't seen it but it will almost certainly by (i) very helpful and (ii) incomplete (it's not meant 1:1 with exam). I think of the handbook as another book on the reading list, but key and worth maybe 3 or 4 books. Caveat: don't know about the questions. If question are good/relevant, will elevate role of handbook (they aren't good in current handbook)

"My feeling is that the fundamentals like stats, fixed income, derivatives should not change a lot, should be a good reference but subjects like credit risk and ops risk may be totally different today."
I agree, credit risk, ops risk and, to an extent investment risk change are more dynamic
- ops due to its nature;
- credit due to the times;
- investment because frankly GARP hasn't perfected its coverage.

In that vein, the best early, relevant preparation remains to be found in the four texts I recommended in the early birds: Gujarati, Hull, Tuckman, Jorion VaR (book). See "critical texts" in this post.

"Will you offer the $100 discount to those who bought the handbook or readings list from the GARP?"
It is not my current plan; rather i offer a -$100 if you buy a competitor product. Frankly, I have much more work to do than GARP, they only have to give the exam, I have to teach it all.
(But let me consult with my business advisor about this. I will see what is possible. Please just don't expect. My pricing helps me hire key help to address the f/back from last year. It is an enormous undertaking to update everything; e.g., fresh videos.)

"If I join the premium service now, will I be able to go through the notes & materials that you posted in 2008?"
By Mon/Tue,yes, this will be true. Some have already joined but we are still debugging/ adding functionality, and organizing the 2008 assets. So, it's a few days away from readiness.

Hope that helps! David

 

[narayananvenkat]

Hi David..

For candidates like me (True loyalists!!!!?) the admission fee sounds a bit costly. A further downards revision is requested. Already FRm exam fees is hiked up But sure you deserve much much more than that. Also a general feel is that DAvid is also becoming costlier(In a lighter vein) for people in this continent where there are less qualitative service providers.

Regards
venkat

 

[David Harper CFA FRM]

Hi venkat,

Thanks, I value your opinion. Can you please clarify b/c I am not sure I completely follow?
Do you think $399 is reasonable/right? Please note: either (i) renewal or (ii) with-proof-of-competitor is -$100. So renewal or "supplement with competititor" = $299.
Do you think, as eddfung suggests, I should be -$100 if candidate buys core readings and/or handbook?

You wrote, "Also a general feel is that DAvid is also becoming costlier(In a lighter vein) for people in this continent where there are less qualitative service providers."
I apologize, I don't understand this can you please clarify?

Thanks! David

 

[narayananvenkat]

Hi David..

Apologies for not being clear to you.
My views are based on my assessment and a host of my friends in Chenai, India, who 1) have successsfully used your services, 2) Still ussers like me and 3) Guys who have come to know about Bt and are positive about it.
1. Current price of US $ 399 looks on higher side for the fees in India for providers who supply materials seminars charge between Rs 12-15k which is roughly Us $200-300. But again the quality, one to one communication of instructors, forum, always available, replayable videos totally absent in them.Considering the affordability and buying capacity, the feel around here is US$ 200-250 is most wanted. Regarding Handbook, Study notes , I bet they are xeroxed and shared. So giving incentives for such guys , I feel does not really benefit. Core reading is an exception and very very few buy teh core readings.So new canidiaes expect the fees around Us & 250-300.
2. ,
t.Regarding returning candidates like those who were members in the past but could not write, against proof of deferral/registering for exam , fees cold be Us $ 100-150. This benefit could be restrcted to only once in a life time.
David these are honest feedback and are not intended to confuse/influence . These are feedback from our heart given our association with Bt on long standing and are without prejudice to your planning and starategies.

Again apologies for being candid.

venkat

 

[David Harper CFA FRM]

Hi venkat,

(please no apologies needed, your candid view is extremely helpful)

In regard to (2), I agree that if a candidate was not able to sit/write, the "renewal" should be inexpensive (e.g., $100 - $150 ) as that implies candidate was not able to utilize resources. Okay, so we can add two options:

(a) renewal: regular = -$100
(b) renewal: with proof of deferral. This can be $149.

In regard to (1), I hear you. Unfortunately, GARP has made everything quite expensive. The price of the core readings this year is so high; i.e., exam + handbook + core = very expensive. And (of course) they have higher margins. But course providers like myself do not have high margins, especially given the expanded test, which is significantly more work. Or, at least in my case, where there are multiple asset types and the videos are refreshed. At $250, for example, given the work it takes to produce all the videos, etc, I cannot afford to hire any help -- at $250, there really isn't a business worth pursuing. At $399, it allows me to hire some part time help, frankly. But I am very appreciate to understand the perception (i.e., the expectation around $300)....I think i need to keep $399 as regular but I can try to add helpful discount options, as per above. Thanks, David

 

[narayananvenkat]

Hi David..

I fully respect your perspective. Looking forward for the rest of the season.

Thanking you

venkat

 

[harmeetsokhi]

Hi David,

I was going through this entire conversation and I couldn't resist to mention here that your attitude towards the queries and the clarity and openness of your responses is just amazing. I've never witnessed this standard before.
No wonder the appreciaton levels in testimonials is so high.
Keep it up.

Regards,
Harmeet Singh Sokhi

 

[[email protected]]

Hi David,

With all due respect to your precious time I will directly ask my question. I am a student in a financial engineering program and would like to supplement my prep in financial stochastic calculus modelling in finance. In your experience will your program benefit me in my preparations ? If so which parts 1 or 2 ?

Many thanks in advance for your reply.

KR

Ahmet Cemil

 

[David Harper CFA FRM]

Hi Ahmet,

I apologize that it is hard for me to answer your question because it depends on what you mean by the goal that you "would like to supplement [your] prep in financial stochastic calculus modeling in finance."

If you mean: will either FRM P1 or P2 help you with stochastic calculus? No, it will not. The FRM frankly only flirts in language with stochastic calculus (the converse is more true: a calculus prep makes some of the FRM easier to follow quickly). In a rough nutshell, the quant in the FRM is a mile wide and a few inches deep (much varied application of quantitative methods over various instruments/situations, made easier if you are schooled in calculus, but not particularly advanced/deep in any given area). For example, GARCH(1,1) and Black-Scholes-Merton are explored only in introduction...

David