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FRM Syllabus 2022 (Level 1 & 2) Financial Risk Management Topic Wise Syllabus

FRM Syllabus

Financial Risk Management Test is conducted by Global Association of Risk Professionals to check the knowledge and skills of applicants about How to Manage Financial Risk. Financial Risk Management Syllabus covers the fundamental tools and methods used in risk management and theories that underlie their use. Download FRM Syllabus 2022 Topic Wise for Level 1 & 2 along with FRM Syllabus PDF from this page.


FRM Syllabus 2022 – Overview

Association Name Global Association of Risk Professionals
Parts in FRM Syllabus Part 1 and Part 2
Category FRM Syllabus 2022
Official Website www.garp.org

FRM Syllabus

FRM Part 1 Syllabus

Foundations of Risk Management (20%)

Topics covered in FRM Exam Syllabus are as follows:

  • An understanding of corporate risk governance and the trade-off between risk and return
  • The construction of efficient portfolios
  • Fundamental asset pricing models
  • Enterprise risk management frameworks
  • Data quality management
  • A review of major financial disasters
  • To emphasize the importance of ethics as a fundamental requirement for sound risk management
  • applications of the GARP Code of Conduct to professional situations are covered in this section as well

Quantitative Analysis (20%)

Topics covered in FRM 2022 Syllabus are as follows:

In this section, aspirant’s knowledge of basic probability and statistics, regression and time series analysis is checked.

  • Monte Carlo methods
  • Volatility forecasting models
  • Value-at-Risk estimation

Financial Markets and Products (30%)

FRM Topics covered in syllabus are as follows:

Here questions are asked from financial products and the markets topics.

  • Futures and forwards
  • Equity options, swaps, and other derivatives
  • Commodities
  • Currencies
  • Corporate bonds and interest rates
  • A basic understanding of arbitrage arguments and hedging related to these financial products.

Valuation and Risk Models (30%)

  • Basic bond valuation and bond hedging
  • Valuation using binomial trees
  • An understanding of the Black-Scholes-Merton model
  • Value-at-Risk (VaR)
  • Expected and unexpected loss estimation
  • Stress testing.

Download PDF – FRM Level 1 Syllabus

FRM Part 2 Syllabus

Market Risk Management (25%)

  • Fixed-income interest rate sensitivities
  • Volatility exposures
  • Value-at-Risk (VaR) and back testing VaR
  • Expected shortfall (ES)
  • Correlations and copulas
  • Parametric and non-parametric estimation methods
  • Extreme value theory (EVT)
  • Exotic options and mortgage-backed securities

Credit Risk Management (25%)

In this section, aspirant’s understanding of credit risk management is checked. Lay emphasize on topics like finance and credit products to score well.

  • Counter party risk
  • Default risk and methodologies

Operational and Integrated Risk Management (25%)

  • Coverage of the tools and techniques necessary to measure, manage, and mitigate operational risk
  • Economic capital allocation
  • Enterprise risk management (ERM)
  • Knowledge of critical issues related to liquidity risk management, model risk, loss data modelling and IT infrastructure, stress testing, and risk appetite

Risk Management and Investment Risk Management (15%)

  • Risk management techniques applied to investment management process
  • Portfolio construction and performance analysis
  • Risk budgeting and portfolio and component VaR
  • Issues related to hedge funds and private equity investments

Current Issues in Financial Markets (10%)

  • Sovereign Risk and Financial Crisis
  • Flash Crash
  • Financial Innovation and Its Issues

Download PDFFRM Level 2 Syllabus

FRM Exam Pattern 2022

FRM Part I Exam Pattern:

  • A 100 question multiple-choice exam, the FRM Exam
  • Part I focus on the tools used to assess financial risk: quantitative analysis, fundamental risk management concepts, financial markets and products, and valuation and risk models.
  • Part I is always offered in the morning and must be completed in four hours or less.

FRM Part 2 Exam Pattern:

  • The FRM Exam Part II is an 80 question multiple-choice exam
  • Part I: market, credit, operational and integrated risk management, investment management as well as current market issues.
  • Part II is always offered in the afternoon and must be completed in four hours or less.

Preparation Books For FRM Exam

FRM Exam Part I Books

The four volume set includes:

  • Foundations of Risk Management
  • Quantitative Analysis
  • Financial Markets and Products
  • Valuation and Risk Management

FRM Exam Part II Books

The four volume set includes:

  • Market Risk Measurement and Management
  • Credit Risk Measurement and Management
  • Operational and Integrated Risk Management
  • Risk Management and Investment Management

FRM Syllabus 2022

Financial Risk Manager Paper is organized for measuring the skills and knowledge of candidates regarding how to manage risk. You may have understanding of risk management concepts and approaches. FRM Syllabus 2022 for Level 1 & 2 will guide applicants in better preparation of exam.

Know Here: How Do Toppers Study?

Financial Risk Management covers the fundamental tools and techniques used in risk management. Questions in Financial Risk Management paper are related to theory, practical, real-world, problems. All you need is to understand risk management concepts and approaches. Download FRM Syllabus 2022 from this page.

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