The Financial Risk Manager (FRM) Part 2 exam is the final hurdle in obtaining the prestigious FRM certification. It builds on the concepts from Part 1, focusing more on real-world applications of risk management practices. In this guide, we will explore what is FRM Part 2, its syllabus, the best books, exam preparation strategies, important topics, and expert tips to pass the exam successfully.

What is FRM Part 2?

FRM Part 2 is the second and final exam in the FRM certification process, conducted by the Global Association of Risk Professionals (GARP). This exam emphasizes the application of risk management principles across various domains, including market risk, credit risk, operational risk, and liquidity risk.

Key Details About FRM Part 2 Exam:

• Conducted by: Global Association of Risk Professionals (GARP)
• Exam Format: 80 multiple-choice questions
• Duration: 4 hours
• Exam Windows: May, August, and November
• Passing Criteria: No fixed passing score; percentile-based ranking

FRM Part 2 Syllabus

The FRM Part 2 syllabus is divided into six key topics, with varying weights:

1. Market Risk Measurement and Management (20%) – VaR methodologies, stress testing, and risk factors.
2. Credit Risk Measurement and Management (20%) – Credit risk models, counterparty risk, and credit derivatives.
3. Operational and Integrated Risk Management (20%) – Basel framework, risk culture, and emerging risks.
4. Liquidity and Treasury Risk Management (15%) – Liquidity stress testing, funding models, and risk governance.
5. Risk Management and Investment Management (15%) – Portfolio risk, hedge funds, and risk budgeting.
6. Current Issues in Financial Markets (10%) – Emerging risks, fintech, and regulatory changes.

Best Books for FRM Part 2

Choosing the right study materials is crucial for success. Some of the best books for FRM Part 2 include:

• GARP Official Books – The most comprehensive resource covering the entire syllabus.
• Schweser FRM Part 2 Notes – Concise and exam-focused study material.
• Bionic Turtle FRM Part 2 Course – Known for its high-quality question banks and video lectures.
• Wiley FRM Part 2 Books – Offers additional practice questions and explanations.

FRM Part 2 Exam Preparation Strategies

1. Create a Study Plan – Allocate at least 4-5 months for structured preparation.
2. Understand Core Concepts – Focus on risk models, regulatory frameworks, and financial instruments.
3. Practice with Mock Tests – Solve 3-5 full-length practice exams to improve time management.
4. Use Multiple Resources – Combine official books with third-party notes and video lectures.
5. Stay Updated on Market Trends – Keep an eye on current financial issues relevant to the exam.
6. Join a Coaching Program – RBei Classes offers expert-led courses that simplify complex topics.

Important Topics for FRM Part 2

Some high-weighted and frequently tested topics include:

• Expected Shortfall (ES) and Value-at-Risk (VaR)
• Basel III Regulations and Risk Frameworks
• Counterparty Credit Risk (CCR) and CVA
• Liquidity Risk and Treasury Management
• Hedge Fund Risk and Risk Budgeting
• Operational Risk and Cybersecurity Threats

Tips to Pass the FRM Part 2 Exam

1. Prioritize High-Weightage Topics – Focus on market and credit risk management first.
2. Develop a Conceptual Understanding – Don’t just memorize; understand the logic behind formulas.
3. Time Management – Allocate time wisely to each question during the exam.
4. Revise Regularly – Consistent revision ensures better retention of key concepts.
5. Take Guidance from Experts – Enroll in RBei Classes for structured coaching and expert mentorship.

Conclusion

Passing the FRM Part 2 exam requires dedication, strategic preparation, and the right resources. By focusing on important topics, practicing extensively, and leveraging expert guidance from RBei Classes, you can increase your chances of success.

Need Expert Guidance?

Join our FRM Part 2 coaching program at RBei Classes and get access to high-quality study materials, live classes, and expert mentoring. Contact us today and take your FRM preparation to the next level!

FAQs

Q1. Is FRM Part 2 harder than Part 1?
Yes, FRM Part 2 is more application-based and conceptually deeper than Part 1.

Deepak Goyal CFA & FRM

Founder & CEO of RBei Classes

• 16,000+ Students Trained in CFA, FRM, Investment Banking & Financial Modelling
• 95% Students Successfully Placed • 94.6% Pass Rate In Exam

Contact Deepak Sir

Q2. How many months are needed for FRM Part 2 preparation?
Most candidates need four to six months of disciplined and structured preparation.

Q3. What is the pass rate of FRM Part 2?
The FRM Part 2 pass rate changes every exam cycle announced by GARP.

Q4. Which coaching is best for FRM Part 2?
Choose coaching with expert faculty, mocks, doubt support, and updated study material.

Q5. Can I prepare for FRM Part 2 without coaching?
Yes, self-study is possible with proper planning, books, mocks, and consistency.

Q6. What are the best books for FRM Part 2?
GARP books, Schweser notes, and Bionic Turtle are popular preparation resources.

Q7. How many hours should I study daily?
Studying two to four focused hours daily is effective for most candidates.

Q8. Is FRM Part 2 useful for finance careers?
Yes, it helps careers in risk management, banking, consulting, and investments.

Q9. Does FRM Part 2 include numerical questions?
Yes, the exam includes calculations, case-based concepts, and analytical questions.

Q10. When is FRM Part 2 conducted?
FRM Part 2 exams are usually conducted in May, August, and November.

Read Also Blogs: 

Best FRM Coaching in Noida for Beginners

Best FRM Coaching in Delhi

FRM Coaching in Gurugram

FRM Coaching in Hyderabad