Comparison of the FRM and CFA Designations
When candidates are trying to decide which designation they want to pursue, the comparison of the FRM vs CFA often comes to mind. The FRM is an excellent way for candidates to improve their knowledge of:
- market risk
- operational risk
- credit risk
- integrated risk management
- valuation and risk models, and
- risk management in investment management, among other topics.
Candidates can choose to take the FRM exam whether they are currently a CFA charterholder or if they plan on becoming one in the future.
Since the skills sets for the CFA and FRM complement each other very well, many CFA holders are also FRMs. For many finance professionals, it is not a case of FRM vs CFA, but instead FRM and CFA!
Demonstrating your competencies in financial risk via the FRM designation is a win-win for CFA charterholders, especially given the prominent role that CROs and risk managers are now taking in financial institutions in the wake of the global financial crisis.
The Bionic Turtle forum is an excellent place to discuss the benefits of becoming a certified FRM, and to speak with others who have chosen to pursue one or both of these designations. Our FRM study packages cover everything that you need to pass the FRM exam.
FRM vs CFA Comparison Chart
|CFA Exam||FRM Exam|
|General investment knowledge (broader than deep)||Focus on risk management (deeper than broad)|
Standards, Quantitative Methods, Economics, Financial Reporting & Analysis, Corporate Finance, Equities, Fixed Income, Derivatives, Alternative, Portfolio Management
Foundations of Risk Mgmt, Quantitative Analysis, Financial Markets & Products, Valuation and Risk Models, Market Risk, Credit Risk, Operational Risk, Liquidity & Treasury Risk, Investment Risk, Current Issues
Portfolio Management, Investment (Equities, Bonds) Research, and Alternatives (Hedge Funds)
Risk and risk-related at Banks, Insurance Firms, Assets Managers, Hedge Funds and Professional Services
|Global recognition as gold standard: over 90,000 CFA charter holders and 160,000 candidates per year||Rapidly growing at 16% per year since 2010: over 50,000 Certified FRMs and just breached 80,000 registered candidates per year|
|3 exams in sequence (quickest path is 18 months)||2 exams (is possible to sit both at once)|
|June and December of each year||May and November of each year|
|Level 1 cost is $1080 (early) to $1660 (late),
Level 2 cost is $630 to $1,210,
Level 3 cost is $630 to $1,210.
Cost includes books.
|Part 1 cost is $900 (early) to $1,200 (late),
Part 2 cost is $645 to $945.
Cost includes books.
|4 years of relevant work experience required||2 years of relevant work experience required|
|38 to 43% pass rate||42% to 60% pass rate|
|Multiple Choice, Item Set and Essay Questions||Multiple Choice Only (4 choices)|
|Exam by CFA Institute||Exam by Global Association of Risk Professionals (GARP)|
For more information about the FRM exam, including how to register for the exam and important deadlines, read through our other informational articles:
Why Should I Obtain My FRM Certification?
Many financial risk candidates have a difficult time deciding which designation would be best for them. There are many reasons that candidates should take the GARP FRM exam and pursue their certification to become a financial risk manager.
Passing the FRM exam makes you stand out from others who do not have their FRM certification!...
FRM Exam Overview, Registration Guide and Deadlines
To become a Certified FRM, candidates must pass the very difficult Financial Risk Management (FRM) exam. Candidates also have to complete two years of work experience. We put together this helpful FRM Exam Overview to help you understand the process...
FRM Exam Preparation Tips and Recommendations
Many of Bionic Turtle’s members have provided feedback with suggestions on the best practices for FRM exam preparation. Whether you use Bionic Turtle’s materials solely for your FRM exam preparation, or as a supplement to the GARP core books, depends on your individual education and...
What Your Colleagues Are Saying
I took the exam in Sydney and had a similar feeling about the exam being more qualitative (but no less rigorous). However, I felt I was better prepared thanks to the BT's relentless focus on throwing real life examples and methods.
I subscribed to BT for my Part 1 FRM exam and just wanted to say thanks for the depth and breadth of the study materials and practice questions. I found out that I scored in the top quartile of every topic and I absolutely could not have done this without using BT - I spent many, many hours going over the practice questions and answers! I wanted to express my appreciation and gratitude to your team for your hard work in creating these materials. Thanks!
The BT scripts, practice questions, global topic drills and mock exams were a great help in understanding the concepts (which I could already apply on the job!) and where structured in such a manner that the breadth and depth where optimal for exam preparation - clearly the exam would have been a catastrophe without BT!
Passed first time. Happy all the hard work paid off. BT was the right choice. Thanks David and Nicole for your work and commitment.
Passed! 1,4,1,2,1,4! Thank you David and Nicole for your efforts! Thank you BT! Couldn't have done it otherwise. I'm a mechanical engineer who had a career in petroleum services, then I decided to switch career to financial risk management. Passed part 1 from the first time with top quartiles and passed part 2 from the first time as well. All with BT! BT is always the recommendation I give to people aiming at the FRM designation! Thank you again!
Passed Part I and Part II first time - absolutely could not have done it without BT. Like a few others I didn't even both buying the GARP books for Part II and went solely with BT materials. Just read, answered questions, watched videos, read, more questions, and... more questions! All the practice question taking looked to pay off. Thanks again Bionic Turtle for a great curriculum. Keep up the fantastic work!