About FRM & PRM

[Sunil Natarajan]

Dear David,
Iam Sunil Natrajan. Iam currently working as a Credit Analyst in a local bank in Mumbai (India).
I would be interested in register for a risk management designation. Which of the 2 major designation i.e FRM or PRM is preferable. I say preferable on the basis of global recognition i.e in North America say Canada or USA, Middle East say Dubai or Doha,in India etc.The curriculam content that each of these designations test on as well as which of the two designations is difficult to obtain even if the duration taken for studying each of them is same i.e say 6-6.5 months. Iam asking this since PRM is demand based exam and can be taken part by part as well whereas FRM is held once in a year and has all the parts/sections jumbled in one paper of 5 hrs with 140 questions.
I would like to know what are the opportunities for FRM or PRM designated professional.Considering today the US & UK financial markets are going through a turmoil.Is this designation more valuable to a CFA designation.Does these designations help an individual looking to enter into corporate finance like M&A;advisory,Restructuring Advisory of Private Equity Advisory field.
I would like to know from you whether you conduct for both FRM as well as PRM. If yes what is the fees you charge for each of these courses.What is the mode of payment for these review programmes (i.e credit cards, swift payment through banks,drafts etc).
What all do you provide in your review programme (i.e notes, CD's, Question Bank etc.). For FRM what are the materials to be reviewed from examination point of view. I mean to say what materials of GARP to be reviewed i.e (4th Edition Hand Book, GARP readings etc). Is the course content for FRM 2008 same as in FRM 2007.
How long before the exams does your review lectures get over i.e as a relative new comer how long does one need to be through with his reading and then start with revision and taking sample/practice test. I would also like to know whether you take review programmes for CFA designation. If yes what is the fees you charge for each level.
Thanking You. Could I have your personal e-mail ID if possible.
Iam sorry to have written a pretty long e-mail since I would like to know about these designations in detail.Please do reply for all my queries.
Once again Thanks. Eagerly awaiting your reply.

Thanks & Regards,
Sunil Natrajan

 

[jyothi1965]

Sunil,

I have completed both my PRM & FRM (the latter was in great part due to BT, and David) and I am a die-hard BT/David admirer. I think there is enough materials on BT itself/the web which compares both these exams so obviously you can do some bit of homework.

Also if you are a credit analyst in India, you would have doubtless heard of Basel II. Well think of Y2K and how life changed for Indian software guys - something close like that is happening worldwide with Basel II. the demand for risk management professionals is growing exponentially. Regardless of the country or area, Basel II is driving huge changes in risk management.

PRM is more doable since the exam can be split into four (although the PRM candidate of the year - from India passed it at one shot). But it does not make the exam any less easy as the absolute passing is 60% in each exam. A 2 sigma effort is required to get you 50%, but it would take a 3 sigma effort to get 60%, and a 4 sigma effort to be absolutely sure that can get 60%. Questions are fairly straightforward, but there are some tricky ones. Most people get stumped by Exam 2 which is fully quant and where you will need to access the 11th /12th class school books - Matrices, determinants, calculus/Integration. But for most Indian engineering students, the level is nothing great.

FRM is an risk examiner's favourite hunting ground. This is where you will begin to realise the devious minds of the Prof setting the questions - the questions are tricky enough, but the choices are so well thought out to ensure that you fall into a trap - which you will. Also I have realised that there is NO WAY anyone an predict the exam questions - a favourite pastime in India - the FRM questions are so well crafted with incredible patience that you marvel that somebody can even set set questions which can test your knowledge to THAT level of understanding!!

Undoubtedly, FRM exam is the gold standard in risk management certifications. But the moot question - what do you learn by passing the exam? I found that I learnt more in PRM partly because I read the handbook (among the most well written and lucidly explained risk books) and you can stagger it at your own pace. So in a sense you will enjoy the thrill of learning and passing the exam.


The FRM is a killer with high anxieties and never knowing whether you will pass or fail, or whether your preparation is adequate or not. It is also a battle of nerves and strategy to peak during the last stages of preparation. There is a fair bit of luck in passing the exam, as it is relative grading, so one is not sure of what performance counts as a pass. I have seen BT bloggers claiming that they got 70% right in the exam only to be stumped on the D day.

Hope this helps anybody who is looking at PRM/FRM comparisons

Jyothi
Bahrain

 

[David Harper CFA FRM]

@Jyothi: thanks, I really appreciate your answer!

Hi Sunil,

Jyothi didn't mention her background but, trust me, she has a better global perspective than I on PRM/FRM. I will add to her answer below as best i can:

"Which of the 2 major designation i.e FRM or PRM is preferable. I say preferable on the basis of global recognition i.e in North America say Canada or USA, Middle East say Dubai or Doha,in India etc. "

In regard to better recognition, I frankly do not have a global perspective on which might hold an advantage. I don't perceive a huge advantage for either. It seems to me that both are respected risk designations; i.e., both symbolize a threshold competence, and maybe more relevantly, an *affinity* for risk study.

"The curriculum content that each of these designations test on as well as which of the two designations is difficult to obtain even if the duration taken for studying each of them is same i.e say 6-6.5 months. I am asking this since PRM is demand based exam and can be taken part by part as well whereas FRM is held once in a year and has all the parts/sections jumbled in one paper of 5 hrs with 140 questions."

A key difference between the exams, and why I selected the FRM instead of the PRM for a product four years ago when i started BT, is that the FRM is dynamically updated each year - like this year, securitization of subprime has been added. And the Basel readings are fresh. It is not visible, but GARP each year devotes significant time to updating the cirriculum, which I value. I agree with Jyothi that the PRM handbooks are excellent but, on the other hand, to my knowledge they have not been updated in a few years. So this is interesting: you are right the readings are a jumble but IMO that's because they are annually refreshed. But still the PRM is excellent on the quantitative foundation, I consider their handbook on quant better than anything in FRM.

"I would like to know what are the opportunities for FRM or PRM designated professional.Considering today the US & UK financial markets are going through a turmoil.Is this designation more valuable to a CFA designation.Does these designations help an individual looking to enter into corporate finance like M&A;advisory,Restructuring Advisory of Private Equity Advisory field."

They do each have a job board:
http://prmia.org/index.php?page=jobs
http://careers.garp.com/search.cfm
(I do not know if reg/membership is required, as i am member of both)

I will say, just my mere opinion, that they key difference btwn FRM & CFA is "life cycle:" the CFA is mature (having entered its so-called membership phase) but GARP/FRM is younger and growing @ 25%/year. Many FinServices jobs routinely require/prefer CFA but very few require/prefer FRM/PRM. But what is INTERESTING to me is that recently we have started to see jobs preferring FRM or "both CFA and FRM."

I would like to know from you whether you conduct for both FRM as well as PRM. If yes what is the fees you charge for each of these courses.What is the mode of payment for these review programs (i.e credit cards, swift payment through banks,drafts etc).

I only offer the FRM (unless and until I can persuade Jyothi to quit her high-paying job and run the PRM product, I have current plans to offer PRM. That's me teasing!).

The FRM is $399 ($299 before May 1st), returning customers get a $100 discount.

What all do you provide in your review programme (i.e notes, CD’s, Question Bank etc.). For FRM what are the materials to be reviewed from examination point of view. I mean to say what materials of GARP to be reviewed i.e (4th Edition Hand Book, GARP readings etc).

The details to the product are here: https://www.bionicturtle.com/features-pricing/

"Is the course content for FRM 2008 same as in FRM 2007. "
No, everything is refreshed. I record entirely new tutorials based on the new AIMs (also, to improve each year)

"I would also like to know whether you take review programmes for CFA designation. If yes what is the fees you charge for each level. "
Thanks for asking, I get this question a lot. I do not currently. I would need to recruit somebody so, please, if anybody is interested please email me at .(JavaScript must be enabled to view this email address)

Thanking You. Could I have your personal e-mail ID if possible. .(JavaScript must be enabled to view this email address)

Thanks for your interest, Sunil!

 

[piyush.rastogi]

Thanks David,

Would really appreciate if you could help for some past papers for PRM also. I have been through the self study guide for PRM, it just mentions a type of question on the subject and nothing else.

Would require some set of questions to practice on.

I would be giving all the four exams at one shot.

Thanks

Piyush.

 

[ankit015]

hey piyush,
I am also think9ng of giving PRM. Could you please telll me what lead you to choose PRM over FRM. AND apart from PRM handbook, where else are you studying from?

 

[gshah]

I am planning to giv the PRM exams. Could someone please pass on the Mock papers of PRM I and II exams. Also let know how much time would eb required to study for PRM I.I am from an engineering background working on wealth management systems in IT industry.

Thanks in advance.

 

[rsharathkumar]

hi
i am planning to study for the PRM exam and from non math background . so could anyone let me know how do i go about achieveing the PRM and what books do i need to study for maths and also work in sales but nothing related to risk management