Some Things to Know about the GARP FRM Course – Part 3

Estimated reading time: 2 minutes



We continue our series about some of the aspects you should know about the FRM course by GARP.

Click here to read Part 1.

Click here to read Part 2.


About level 1

You will have to face 100 questions in part 1 of this course. All of these questions will be in multiple-choice format.

An extremely important thing to remember is that you are not penalized for any incorrect answer, so be sure to put an answer for every single one.

The areas to be tested in part 1 and their respective weightings are as follows:

  • Foundations of Risk Management (20%)
  • Quantitative Analysis (20%)
  • Financial Markets and Products (30%)
  • Valuation and Risk Models (30%)


About level 2

In part 2, there are 80 questions to get by and, again, these will be in multiple-choice format.

Likewise, there are no negative consequences of incorrectly answered questions, so feel free to make an educated guess (if necessary) and just move on to the next one.

The areas to be tested in part 2 and their respective weightings are as follows:

  • Market Risk Measurement and Management (20%)
  • Credit Risk Measurement and Management (20%)
  • Operational Risk and Resiliency (20%)
  • Liquidity and Treasury Risk Measurement (15%)
  • Risk Management and Investment Management (15%)
  • Current Issues in Financial Markets (10%)


Examination hours

Both parts allot you 4 hours each to complete. As a result of this, you will be spending approximately 2 and a half minutes per question (on average) for level 1, and approximately 3 minutes per question (on average) for level 2.

Remember there are 20 fewer questions to face in part 2 so you’ll have a little bit more time per question (on average).

Please use your time wisely and don’t spend too much time for any particularly difficult question.

Also try to manage your time in such a way that you will have a bit of extra at the end to recheck your answers.


How to secure the designation

In addition to getting through both levels, all candidates will be required show to the governing body that you have at least 2 years of related/relevant working history.


Historical pass rates

The pass rates for both levels have typically been in the 40% range. We have said this many times before- this is no easy examination.

Discipline and focus are key to attaining this certification.


Hours of studying

Giving an exact answer to this given issue is next to impossible. This is so for the simple reason that every single candidate comes to the table with varying experience and knowledge.

That said, data purists have said that you should typically study for somewhere between 200 and 300 hours for each level.

Remember, what works for one may not work for another. Some may manage on fewer hours of study while others will need more.


Permitted calculators

Please check the GARP website to see the most up-to-date information on this. Presently, the permitted calculators are:

  • The Texas Instruments BA II Plus
  • The Texas Instruments BA II Plus Professional
  • The Hewlett Packard 10B II, 10B II+ and 20B
  • The HP 12C, 12C Platinum and 12C Anniversary Edition


Thank you!

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