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FAQ Before Exam What is the pass rate for the FRM?

David Harper CFA FRM

David Harper CFA FRM
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On January 6th, 2017 GARP posted the pass rates for the November 2016 exam:
  • The November 2016 Part 1 (P1) pass rate was 44.8% and
    • The updated long-term average P1 pass rate is 46.8%
  • The November 2016 Part 2 (P2) pass rate was 54.3%.
    • The updated long-term average P2 rate is 56.8% which is about 10.0% higher than the long-term average P1 pass rate (my long term averages include 14 exams from 2010 to 2016 inclusive).
I updated our historical graph below. With respect to the most recent (November 2016) pass rates, three observations:
  1. Both recent pass rates were at least 2.0% below the historical long-run average (November 2016 Part 1 was 2.1% below the prior average; November 2016 Part 2 was 2.7% below the prior average).
  2. The recent seasonal trend failed to re-appear for Part 1 but did show muted recurrence for Part 2. I previously itemized the P1 season trend here, but you can see below that in the last two years we had been seeing an alternating trend of lower pass rates in May followed by higher pass rates in November. This did not happen for Part 1 in November.
  3. The difference in P1 versus P2 pass rates in November was about 9.5%, and this is fairly consistent with history: the P2 pass rate tends to be 9.0 to 10.0% higher than the P1 pass rate.

 
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Nicole Seaman

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#3
why the passing rate is lower for may each year? It is giving me shivers @David Harper CFA FRM
Hello @surojitpalb

This is a post from another thread regarding the pass rates. David mentions a possible reason why the passing rate might be lower for the May exams.

https://www.bionicturtle.com/forum/...part-1-exam-feedback.10028/page-13#post-47504:

"The syllabus does not change from May to November which leads to a theory that November takers might do better because they have more time to prepare for the given syllabus (see my note here https://www.bionicturtle.com/forum/threads/may-2016-part-1-exam-feedback.9609/page-13#post-43494), but that "November bump" did not happen for P1 takers this time"
 
#4
Hello @surojitpalb

This is a post from another thread regarding the pass rates. David mentions a possible reason why the passing rate might be lower for the May exams.

https://www.bionicturtle.com/forum/...part-1-exam-feedback.10028/page-13#post-47504:

"The syllabus does not change from May to November which leads to a theory that November takers might do better because they have more time to prepare for the given syllabus (see my note here https://www.bionicturtle.com/forum/threads/may-2016-part-1-exam-feedback.9609/page-13#post-43494), but that "November bump" did not happen for P1 takers this time"
Does the question pattern or the difficulty level of the exams play a part in it? I mean the questions of May are tougher than November?
 

David Harper CFA FRM

David Harper CFA FRM
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@surojitpalb Re "Does the question pattern or the difficulty level of the exams play a part in it? I mean the questions of May are tougher than November?" Definitely not with any intention by GARP. Although in my prior post I did speculate on how, it seems reasonable to me that given a constant syllabus with the year, GARP might learn something from May to November; e.g., a question turns out to be tougher than expected after they have the data from May. Speculation on my part.
 
#6
My selection will be based on the overall performance of the top students i.e. percentile based and not based on the GARP percentage passing barrier? Am I right?
 
#7
In short, let's say GARP takes the best 1% of candidates and then sets a threshold (min. no. of questions) which other candidates have to get right in order to pass. No one knows how many questions out of 100 (Part I) or 80 (Part II) have to be right for a pass. Based on my own experience from the exam I can assure you that I was not able to answer a bunch of questions and still passed quite easily. As a benchmark I would say that if you can get 60 questions right out of 100 you are definitely on the safe side, but this is my own guess!
 
#8
In short, let's say GARP takes the best 1% of candidates and then sets a threshold (min. no. of questions) which other candidates have to get right in order to pass. No one knows how many questions out of 100 (Part I) or 80 (Part II) have to be right for a pass. Based on my own experience from the exam I can assure you that I was not able to answer a bunch of questions and still passed quite easily. As a benchmark I would say that if you can get 60 questions right out of 100 you are definitely on the safe side, but this is my own guess!
This is my first time. Still confused about my preps. :(
 

David Harper CFA FRM

David Harper CFA FRM
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I agree @emilioalzamora1 except just minor tweak, GARP has told us they set a ratio based on the top 5%. See https://www.bionicturtle.com/forum/...de-for-frm-part-1-and-part-2.9579/#post-42322
To my knowledge, @ShaktiRathore 's links above still apply (although we can confirm this week with GARP) and the exam methodology has not changed: the top 5% quantile (ie, the top ventile) score is determined from the overall score then a ratio is applied to that score. But the ventile cannot be known ex ante, and further the ratio varies; this amounts to a sophisticated version of "grading on a curve." @ShaktiRathore illustrates with an example (in links above) for P2 which seems plausible as an illustration of the mechanics: he assumes that the top ventile score is 75 out of 80, and the passing ratio is 70%, such that the passing score is 75 * 70% = 52.5. But it's just an illustration, GARP has certainly never guaranteed to us a fixed passing rate. It's my understanding that the intention is more along the lines of maintaining (eg) the P2 pass rate above 50%. Thanks!
 

Nicole Seaman

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#12
David updated our historical graph yesterday after the May exam results were released :)
  • The average pass rate since 2010 (i.e., May 2010 to May 2017) for Part 1 is 46.47%%
  • The average pass rate since 2010 (i.e., May 2010 to May 2017) for Part 2 is 56.58%

 
#15
Hello @annmohankunnath

Please notice that I moved your question here, where the pass rates for the exam are already discusses. The pass rate changes each year, as you can see above. We will update this once we have the information for the November 2017 pass rates.

Thank you,

Nicole
Thanks a lot Nicole. Also, usually what quartile scores do we need to clear Level 2?
 

Nicole Seaman

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#16

David Harper CFA FRM

David Harper CFA FRM
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Here is an updated (to include the most recent November 2017 pass rates) chart of pass rates for the FRM:
  • The November 2017 Part 1 (P1) pass rate of 42.4% was ~ 4.1% below its long-term (trailing) average of 46.5%
  • The November 2017 Part 2 (P2) pass rate of 51.9% was ~ 4.7% below its long-term (trailing) average of 56.6%
  • The 9.5% differential (= 51.9% - 42.4%) is consistent with the long-run average differential of about 10.0% (+/- 0.036σ)
 
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