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Exam Feedback January 2021 Part 1 Exam Feedback (postponed 2020 exam)

Nicole Seaman

Director of FRM Operations
Staff member
Subscriber
We hope that everyone did well on the FRM Part 1 exam on Saturday! :) We would love to hear any feedback that you have about the exam. How did it go? Did you encounter unexpected questions? How was the experience with all of the new COVID guidelines? Thank you in advance for any feedback you can provide!
 
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pbhalava

New Member
From my opinion, the exam wasn't very tough, it was moderate, but, I did find it lengthy. Also, questions were asked from all nook and corners, like there was a qn on Jarque-Bera test. I had to make an educated guess on around 8-9 questions and wild guess on another 4-5. Let's hope I clear it.
 

Vrp

New Member
Subscriber
Not too tough, was do-able with some weeks of preparation. However I am not sure if I'll make it this time or not as the no. of participants might me higher this time due to last deferment. I am not able to register for Part 1 Exam in May'21.. Any idea when are returning candidates allowed to re-register ?
 

ktrathen

Member
I agree with other people's assessment on this forum, that the exam involved trickier qualitative questions than the mocks, but that the quantitative questions were quite easy. I had no issues with time, and finished with an hour to spare. There were 5 questions I was very unsure about, a couple where I realised afterwards my obvious mistakes, and maybe 20 that I had a question mark next to, mostly due to the annoying ambiguity of the qualitative answers. Some of the time it felt like they were testing my ability to interpret grammar rather than my underlying knowledge of risk.

If I had my time again (advice to new candidates), I would spend less time honing my skills on quantitative questions, and more time making detailed notes on qualitative material.

I'm hopeful that I will pass, especially given the trend on this forum that candidates tend to do better than they expected. But we shall find out in six weeks!
 

ktrathen

Member
From my opinion, the exam wasn't very tough, it was moderate, but, I did find it lengthy. Also, questions were asked from all nook and corners, like there was a qn on Jarque-Bera test. I had to make an educated guess on around 8-9 questions and wild guess on another 4-5. Let's hope I clear it.

For those wondering, the questions on things like Jacque-Bera and Durbin Watson/unit root were of a qualitative nature. So if you roughly understood what those things are, the wrong answers were pretty easy to exclude. This was consistent with the learning outcomes.
 
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RajivBoolell

Member
Subscriber
Hello all –
The questions were fairly in line with Garp’s practice exam and at least 1-2 levels easier than BT mock questions. Some of the qualitative questions gave me a bit of difficulty since a few questions required having gone through some very specific concepts in the GARP books.

From what I can remember:
[I'll Edit this if I remember something else]
  • 2 questions with on conditional probability and bayes theorem. 1 question provided a conditional probability table.
  • A question on Expected shortfall and VaR calculation in a discrete setting. I think the data went something like that on a portfolio of 8M USD 1611056508136.png
  • 2 qualitative questions on the assumptions of OLS
  • There were questions that were straightforward on Option pricing. N(D1) and N(D2) lookups were not required. [Edit : One of them I remember gave me a few difficulties due to it's ambiguity. We were given N(D1) and N(D2) with dividend but also the dividend amount and asked to calculate the price of the bond. I was initially confused by that wording]
  • 1 question on key rates. I do not remember it exactly.
  • 1 question on the interest futures. We were given the characteristics (maturity and duration I think) of the cheapest to deliver bond and asked to to infer whether the interest rates were above or lower 6% and whether the curve was upward or downward sloping
  • 1 qualitative question on Solvency 2 which is a bit astonishing given that this is not a core focus of garp reading.
  • There were a few questions about volatility. 1 question asked us to calculate volatility given EWMA assumptions. There were other questions, if I remember correctly, about the relationship between EWMA and GARCH (1,1) that were qualitative.
  • There was a question about the assumptions underlying APT vs the CAPM
  • We had 2 question asking us to rank portolios according to the sharp and the treynor ratio.The one with the Treynor ratio require a bit of attention, we were given the fact that the ranking was being done on well diversified portfolios but with the additional constraint of the sharpe ratio not being higher(or was it lower?) than 0.35
  • 2 questions on the role of Senior management. One was the role of senior management vs the Board in the context of stress testing. I cannot remember the other one,unfortunately
  • Barbell portfolio from a given bullet portfolio
Concerning the exam logistics:
[Edit : As per @Nicole Seaman request below - The test location was in Paris 17 eme Arrondissement ]
It was a mess!! We had a fair share of candidates in our exam venue that came without the correct calculator. Proctors were unsure to allow them to pass the exam without the use of their calculators or to send them on their way.
Moreover, several candidates, including me, were given the wrong exam booklet. ERP i/o FRM. We asked twice and the proctors told us it was the same thing...” you will see during the exam” was what I think they said. Given that this was my first sitting, I had a lot of doubt but let it pass at first.
I had to ask them a third time to cross check before they eventually asked their senior and realised that they made a mistake. The worse of it was that those who face that issue were not given additional time to enter fill in their candidate’s details. I was prepared and was able to finish with some time to spare but I think I lost a good 5-10 minutes not including the stress and loss of momentum that such situations create.
While I understand logistic issues are problematic with the covid, the fact that the proctors did not know their stuff was quite frightening and I would go further and say disrespectful given the cost and investment that the FRM requires.
 
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Nicole Seaman

Director of FRM Operations
Staff member
Subscriber
Hello all –
The questions were fairly in line with Garp’s practice exam and at least 1-2 levels easier than BT mock questions. Some of the qualitative questions gave me a bit of difficulty since a few questions required having gone through some very specific concepts in the GARP books.

From what I can remember:
[I'll Edit this if I remember something else]
  • 2 questions with on conditional probability and bayes theorem. 1 question provided a conditional probability table.
  • A question on Expected shortfall and VaR calculation in a discrete setting. I think the data went something like that on a portfolio of 8M USD View attachment 3089
  • 2 qualitative questions on the assumptions of OLS
  • There were questions that were straightforward on Option pricing. N(D1) and N(D2) lookups were not required. [Edit : One of them I remember gave me a few difficulties due to it's ambiguity. We were given N(D1) and N(D2) with dividend but also the dividend amount and asked to calculate the price of the bond. I was initially confused by that wording]
  • 1 question on key rates. I do not remember it exactly.
  • 1 question on the interest futures. We were given the characteristics (maturity and duration I think) of the cheapest to deliver bond and asked to to infer whether the interest rates were above or lower 6% and whether the curve was upward or downward sloping
  • 1 qualitative question on Solvency 2 which is a bit astonishing given that this is not a core focus of garp reading.
  • There were a few questions about volatility. 1 question asked us to calculate volatility given EWMA assumptions. There were other questions, if I remember correctly, about the relationship between EWMA and GARCH (1,1) that were qualitative.
  • There was a question about the assumptions underlying APT vs the CAPM
  • We had 2 question asking us to rank portolios according to the sharp and the treynor ratio.The one with the Treynor ratio require a bit of attention, we were given the fact that the ranking was being done on well diversified portfolios but with the additional constraint of the sharpe ratio not being higher(or was it lower?) than 0.35
  • 2 questions on the role of Senior management. One was the role of senior management vs the Board in the context of stress testing. I cannot remember the other one,unfortunately
  • Barbell portfolio from a given bullet portfolio
Concerning the exam logistics:
It was a mess!! We had a fair share of candidates in our exam venue that came without the correct calculator. Proctors were unsure to allow them to pass the exam without the use of their calculators or to send them on their way.
Moreover, several candidates, including me, were given the wrong exam booklet. ERP i/o FRM. We asked twice and the proctors told us it was the same thing...” you will see during the exam” was what I think they said. Given that this was my first sitting, I had a lot of doubt but let it pass at first.
I had to ask them a third time to cross check before they eventually asked their senior and realised that they made a mistake. The worse of it was that those who face that issue were not given additional time to enter fill in their candidate’s details. I was prepared and was able to finish with some time to spare but I think I lost a good 5-10 minutes not including the stress and loss of momentum that such situations create.
While I understand logistic issues are problematic with the covid, the fact that the proctors did not know their stuff was quite frightening and I would go further and say disrespectful given the cost and investment that the FRM requires.
Hello @RajivBoolell

Thank you very much for this detailed information. Can you include where you took the exam? This may be helpful to other candidates. I am very sorry to hear that the exam process went this way for those at your exam location. This is not acceptable, and I would expect more from a professional organization....although I will keep my thoughts about this whole process during COVID to myself ;) There is absolutely no reason that the proctors did not know the difference between the ERP booklet and the FRM. It is completely unacceptable in my opinion.
 

Nicole Seaman

Director of FRM Operations
Staff member
Subscriber
Not too tough, was do-able with some weeks of preparation. However I am not sure if I'll make it this time or not as the no. of participants might me higher this time due to last deferment. I am not able to register for Part 1 Exam in May'21.. Any idea when are returning candidates allowed to re-register ?
Hello @Vrp,

It is my understanding that you would not be able to register for the Part 1 exam again until you find out if you passed it the first time. I don't believe GARP allows you to register for an exam that you are waiting for the results on, but I could be wrong. GARP would definitely be able to answer this question for you (or another member may have experience with this also).
 

ktrathen

Member
The logistics of the exam in Melbourne were very good. My only two issues were the fact that the room was large and echoey, so difficult to hear the proctor, and that there was no clock. Relatively minor issues though.
 

Natarajanmelb

New Member
The logistics of the exam in Melbourne were very good. My only two issues were the fact that the room was large and echoey, so difficult to hear the proctor, and that there was no clock. Relatively minor issues though.
Agree. Wasn't able to hear anything the proctor was saying!
 

dtammerz

Member
For those wondering, the questions on things like Jacque-Bera and Durbin Watson/unit root were of a qualitative nature. So if you roughly understood what those things are, the wrong answers were pretty easy to exclude. This was consistent with the learning outcomes.
I don't think that Durbin-Watson test is part of the 2020/1 Learning Objectives or notes/GARP text from my search. Surprised they would ask about it, unless it was in passing?
 

Paras Chhabra

New Member
Subscriber
Hello all –
The questions were fairly in line with Garp’s practice exam and at least 1-2 levels easier than BT mock questions. Some of the qualitative questions gave me a bit of difficulty since a few questions required having gone through some very specific concepts in the GARP books.

From what I can remember:
[I'll Edit this if I remember something else]
  • 2 questions with on conditional probability and bayes theorem. 1 question provided a conditional probability table.
  • A question on Expected shortfall and VaR calculation in a discrete setting. I think the data went something like that on a portfolio of 8M USD View attachment 3089
  • 2 qualitative questions on the assumptions of OLS
  • There were questions that were straightforward on Option pricing. N(D1) and N(D2) lookups were not required. [Edit : One of them I remember gave me a few difficulties due to it's ambiguity. We were given N(D1) and N(D2) with dividend but also the dividend amount and asked to calculate the price of the bond. I was initially confused by that wording]
  • 1 question on key rates. I do not remember it exactly.
  • 1 question on the interest futures. We were given the characteristics (maturity and duration I think) of the cheapest to deliver bond and asked to to infer whether the interest rates were above or lower 6% and whether the curve was upward or downward sloping
  • 1 qualitative question on Solvency 2 which is a bit astonishing given that this is not a core focus of garp reading.
  • There were a few questions about volatility. 1 question asked us to calculate volatility given EWMA assumptions. There were other questions, if I remember correctly, about the relationship between EWMA and GARCH (1,1) that were qualitative.
  • There was a question about the assumptions underlying APT vs the CAPM
  • We had 2 question asking us to rank portolios according to the sharp and the treynor ratio.The one with the Treynor ratio require a bit of attention, we were given the fact that the ranking was being done on well diversified portfolios but with the additional constraint of the sharpe ratio not being higher(or was it lower?) than 0.35
  • 2 questions on the role of Senior management. One was the role of senior management vs the Board in the context of stress testing. I cannot remember the other one,unfortunately
  • Barbell portfolio from a given bullet portfolio
Concerning the exam logistics:
[Edit : As per @Nicole Seaman request below - The test location was in Paris 17 eme Arrondissement ]
It was a mess!! We had a fair share of candidates in our exam venue that came without the correct calculator. Proctors were unsure to allow them to pass the exam without the use of their calculators or to send them on their way.
Moreover, several candidates, including me, were given the wrong exam booklet. ERP i/o FRM. We asked twice and the proctors told us it was the same thing...” you will see during the exam” was what I think they said. Given that this was my first sitting, I had a lot of doubt but let it pass at first.
I had to ask them a third time to cross check before they eventually asked their senior and realised that they made a mistake. The worse of it was that those who face that issue were not given additional time to enter fill in their candidate’s details. I was prepared and was able to finish with some time to spare but I think I lost a good 5-10 minutes not including the stress and loss of momentum that such situations create.
While I understand logistic issues are problematic with the covid, the fact that the proctors did not know their stuff was quite frightening and I would go further and say disrespectful given the cost and investment that the FRM requires.


Hey Rajiv
Great explanation of the exam and circumstances around it
Btw, do u remember the conditional probability question (without the table) with credit card timely payment ?
Either i was reading it all wrong or somehow i wasnt getting the answer out of the options
Would love to hear..
 

ktrathen

Member
I don't think that Durbin-Watson test is part of the 2020/1 Learning Objectives or notes/GARP text from my search. Surprised they would ask about it, unless it was in passing?

I think I meant to say the Augmented Dickey Fuller test, sorry. It's all a big blur now!
 

ktrathen

Member
Hey Rajiv
Great explanation of the exam and circumstances around it
Btw, do u remember the conditional probability question (without the table) with credit card timely payment ?
Either i was reading it all wrong or somehow i wasnt getting the answer out of the options
Would love to hear..

I agree. Question 82. I kept getting 1.1%. The only answer where the conditional probability was less than the unconditional probability (which was 8.5%) was answer (A), 3%. So I went with that. I even tried annualising it to see if that was what they were going with. I reckon it might've been a mistake. Not sure.
 

Natarajanmelb

New Member
I agree. Question 82. I kept getting 1.1%. The only answer where the conditional probability was less than the unconditional probability (which was 8.5%) was answer (A), 3%. So I went with that. I even tried annualising it to see if that was what they were going with. I reckon it might've been a mistake. Not sure.
Same here. Just couldn't get the right answer
 

pbhalava

New Member
I agree. Question 82. I kept getting 1.1%. The only answer where the conditional probability was less than the unconditional probability (which was 8.5%) was answer (A), 3%. So I went with that. I even tried annualising it to see if that was what they were going with. I reckon it might've been a mistake. Not sure.
Yup, same issue here. Finally had to randomly guess the answer. All the options seemed wrong.
 

Paras Chhabra

New Member
Subscriber
Slowly but surely i am starting to find people joining me on this. I thought i misread the ques..but i kept re-reading it. Is it acceptable for garp if indeed the question did not have a correct answer choice?
 

RajivBoolell

Member
Subscriber
Hey Rajiv
Great explanation of the exam and circumstances around it
Btw, do u remember the conditional probability question (without the table) with credit card timely payment ?
Either i was reading it all wrong or somehow i wasnt getting the answer out of the options
Would love to hear..
Hi @PaParas - I had to guess that one; None of the answers seemed to fit.
 

Paras Chhabra

New Member
Subscriber
Well after reading all your thoughts on this, it looks highly likely that Garp got that question (its options) wrong..Seriously unacceptable. Aint it?
 
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