Financial risk management refers to a professional designation given by global association of risk professionals. One becomes a pro in risk assessment if they get an FRM designation. A professional who has taken an FRM examination can work in accounting firms, insurance companies, banks and asset management firms.
One can become a financial risk manager after getting an FRM designation. A financial risk management designations therefore very necessary for financial professionals. You cannot however pass in your FRM examination if you are not very conversant with what it entails. Several guides will help you in passing your FRM examinations.
First, you should know that the FRM examinations includes two parts. You also need to know that the FRM examination has some multiple choices and only a pencil should be used. The first part of an FRM examination contains one hundred equally weighted questions. On the other hand, the FRM part 2 contains eighty questions that are equally weighted as well.
The essential tools and techniques applied in risk management and theories that underlie it is included in FRM part 1. You will have four hours for the FRM part one. FRM part 1 mainly deals with key concepts of risk management, quantitative analysis and general knowledge on financial markets. The FRM part 2 on the other hand uses the tools and techniques that have been learnt in part 1. The current market issues and investment management is also looked at depth in FRM 2. You are given a maximum of four hours to cover the FRM part 2 examination. Between 40% and 50% is the pass mark for the two FRM parts.
Normally, those taking a financial risk management examination are provided with a standard table known as the z table which contains the values for the CDF.There is no need to therefore memorize the CDF values. You will as well be provided with the common abbreviations used in an FRM exam.
You also need to know that there is need to do proper preparations for an FRM examinations. It is recommended that you study for at least two hundred and fifty hours for any FRM test. Every year, a financial risk management exam is done in the months of May and November. You can have your financial risk management examination in any of the ninety sites that offer it. The FRM site that is near you would be the best to choose.
You can be allowed to sit for the two financial risk management examinations parts the same day. However, for the FRM part 2 to be graded, you must have passed FRM 1. You may not pass your FRM exam if you do not work hard.