MidhaFin Blog · Career Guidance
FRM vs CFA: Which One Is Better?
Candidates almost always start this decision with the word better, and that is the wrong word. The FRM and the CFA are not competing for the same seat. One trains you to decide what an asset is worth and whether it belongs in a portfolio. The other trains you to estimate how much you can lose on that same asset, and then to ask whether your own estimate can be trusted.
Once you can see the question each programme is built around, the choice usually answers itself. The fees, the pass rates and the hours all follow from that split rather than deciding it.
Key Takeaways
- The CFA asks what an asset is worth. The FRM asks how much can be lost on it and whether that estimate holds under stress.
- CFA Level 1 covers 10 topics. FRM Part 1 covers four modules and Part 2 covers six different ones, so Part 2 is not Part 1 taught deeper.
- Official guidance is about 300 hours per CFA level and about 240 hours per FRM part. MidhaFin recommends around 600 hours per part and per level.
- 600 hours lands as 25 hours a week for 20 weeks of coverage, then 30 hours a week for a final revision month.
- Exam fees run USD 3,520 to 4,570 across the three CFA levels and USD 1,600 to 2,000 across both FRM parts, first attempt.
- Passing FRM Part 1 does not make you an FRM, and passing CFA Level 1 does not make you a charterholder. Both carry an experience requirement.
The question each programme is built around
Both curricula teach fixed income, derivatives, quantitative methods and portfolio management, so the two contents pages look heavily overlapped. They are not, because the two programmes do different things with the same instrument.
Take a single corporate bond. The CFA curriculum asks what it is worth: discount the cash flows, read the spread over the benchmark, judge whether the compensation is adequate for the credit, and decide whether the position fits the mandate.
The FRM curriculum largely begins after you own it. Part 1 computes a 1-day 99% VaR on that position. Part 2 backtests the number against what actually happened, checks whether the exceptions cluster rather than arriving independently, examines why VaR is not subadditive, and moves to expected shortfall.
That split explains almost every other difference between the two, including the roles each one hires into, and it is why the question of which is harder never settles cleanly. They are hard in different directions.
One contrast changes how you prepare more than most candidates expect. Ethics is a single short reading in FRM Part 1. In the CFA Program it runs across all three levels and it can decide a borderline result.
What sits inside each curriculum
CFA Level 1 covers 10 topics: quantitative methods, economics, financial statement analysis, corporate issuers, equity investments, fixed income, derivatives, alternative investments, portfolio management, and ethical and professional standards. Level 2 takes the same map and moves from computation to application and valuation. Level 3 moves to portfolio construction and asset allocation, carries a constructed response section, and since the 2025 exams offers three specialised pathways: Portfolio Management, Private Markets and Private Wealth.
The FRM is built differently. Part 1 covers four modules and Part 2 covers six, and they are different modules rather than the same ones taught deeper.
| FRM Part 1 module | Weight | FRM Part 2 module | Weight |
|---|---|---|---|
| Foundations of Risk Management | 20% | Market Risk | 20% |
| Quantitative Analysis | 20% | Credit Risk | 20% |
| Financial Markets and Products | 30% | Operational Risk and Resiliency | 20% |
| Valuation and Risk Models | 30% | Liquidity and Treasury Risk | 15% |
| Risk Management and Investment Management | 15% | ||
| Current Issues in Financial Markets | 10% |
Treating FRM Part 2 as a revision of Part 1 with harder arithmetic. The module lists do not match. Part 1 teaches you to compute the number. Part 2 asks whether the model behind it can be trusted, which is a different skill and needs a different preparation plan.
The roles behind each credential
The CFA Program points at investment decision making: research analyst, fund manager, portfolio manager, rating analyst, and modelling and valuation roles. The work is largely client facing or mandate facing, and the output is a recommendation someone acts on.
The FRM points at risk measurement and control: credit risk analyst, market risk analyst, operational risk manager, risk quantification manager, enterprise risk manager. Hiring concentrates in global banks, risk advisory practices, rating agencies, and increasingly in digital lending and analytics. The output is a number, a limit, or a challenge to somebody else’s number.
Our position has not changed in over a decade of teaching both. If you are interested in investment, portfolio or fund management, no designation beats the CFA. If you see risk as your future, none beats the FRM.
One asymmetry matters if you are starting out. Without work experience the CFA opens more doors, simply because more roles are written against it. The FRM is narrower by design, and that narrowness becomes an advantage once you are inside a risk function.
Both credentials carry a tail beyond the exams. FRM certification requires both parts plus two years of relevant professional risk management experience, demonstrated within five years of passing Part 2. The CFA charter requires all three levels, 4,000 hours of relevant experience, a degree or final year standing at registration, and CFA Institute membership.
Exam structure and what a pass rate tells you
FRM Part 1 is 100 multiple choice questions in 4 hours, about 2.4 minutes each. Part 2 is 80 questions. Both parts are computer based and neither carries negative marking. The CFA Program runs across three sequential levels, with several windows a year at Level 1 and fewer as you go up.
Because there is no negative marking on either FRM part, an educated guess is better than leaving a blank. Work the paper in two passes: answer what you are confident about first, flag and skip the rest, then return in the final hour. A workable pace is about 25 questions in the first hour, 50 cumulative by the end of the second, and 70 to 75 by the end of the third.
Treat every published pass rate as history rather than forecast. CFA Level 1 has averaged around 40% over the past decade, with the February 2026 window at 45%. FRM Part 1 usually lands around half.
What the headline hides is the composition of the cohort. CFA Institute published the split for that February 2026 window: first time candidates passed at 50%, candidates who had deferred at least once passed at 30%. Same exam, same window, 20 percentage points apart. A pass rate is not a probability that applies to you. It is an average across a group that includes many people who were never on schedule.
Your preparation is the variable you control. Plan against hours, not against percentages.
How much time this actually takes
Start with the official figures. CFA Institute recommends roughly 300 hours per level, about 900 across the three. GARP publishes that candidates typically spend around 240 hours per part, with reported study time ranging from under 100 to more than 400.
Both are accurate as averages, and neither is a plan. An average blends the candidate who already works in a treasury function with the one who has not opened a statistics textbook since school. At MidhaFin we plan against two different candidates instead.
The just to pass range, 250 to 300 hours
This works, and we will not pretend otherwise. If financial statements, statistics and time value of money are already comfortable, 250 to 300 hours can get you across the line.
Be clear about what you are buying. You will pass with gaps, and the gaps do not stay quiet. They show up in FRM Part 2, where the model you learned to run in Part 1 is the model you are now asked to criticise, and at CFA Level 2, where the computation you memorised is now assumed. They show up in interviews too, where nobody asks you to reproduce a formula but everybody asks what the output means.
Below 250 hours you are not planning, you are hoping.
The mastery range, around 600 hours, which is what we recommend
If the point of the certification is the job and not the certificate, plan for around 600 hours per FRM part and per CFA level.
That sounds heavy against the published 240, and it is not inflated. It is the difference between computing a 99% VaR and being able to say which assumption inside it breaks first, and what happens to the number when volatility regimes shift. The second candidate holds the conversation past the first follow up question. The first one cannot.
A candidate has fixed an FRM Part 1 exam date 24 weeks away and wants the mastery plan. How should the 600 hours be laid out?
- Reserve the final revision month first, because it is the block candidates always surrender. That leaves 20 weeks for coverage.
- Revision runs harder than coverage, at 30 hours a week. 4 x 30 = 120 hours.
- Take the remainder. 600 minus 120 = 480 hours across 20 weeks.
- 480 / 20 = 24 hours a week, which rounds to the 25 we plan coverage at.
- Insert one planned break week after every fourth week, to absorb illness and work travel rather than pushing the exam date.
Answer: 25 hours a week for 20 weeks, then 30 for the final 4. With the break weeks, the honest window is around six months.
For CFA Level 1 the same arithmetic gives six months as the ideal window. Three months works only at 25 to 30 hours a week with a strong finance background already in place.
Practice volume matters as much as coverage. Per FRM part, plan 2,000 to 2,500 questions and four to five timed full length mocks in the last six to eight weeks. For CFA Level 1, the final 60 days run roughly 70% on questions and 30% on revising formulas, concepts and your error log.
The last month is intelligent repetition, not frantic new learning. Wind down heavy studying about three days before the exam and give the final days to your error notes and formula sheets.
What each programme costs
The two are priced differently in structure, not only in amount. The CFA Program charges a registration fee per level and has carried no enrolment fee since April 2025, so older figures still circulating are out of date. GARP still charges a one time enrolment fee alongside each part registration. In both cases the early window is cheaper.
| CFA Program | Early registration | Standard registration |
|---|---|---|
| One time enrolment fee | Nil | Nil |
| Level 1 | USD 1,140 | USD 1,490 |
| Level 2 | USD 1,140 | USD 1,490 |
| Level 3 | USD 1,240 | USD 1,590 |
| Total, first attempt at all three levels | USD 3,520 | USD 4,570 |
| FRM certification | Early registration | Standard registration |
|---|---|---|
| One time enrolment fee, with the Part 1 registration | USD 400 | USD 400 |
| Part 1 | USD 600 | USD 800 |
| Part 2 | USD 600 | USD 800 |
| Total, first attempt at both parts | USD 1,600 | USD 2,000 |
Two points belong with both tables. These are exam fees only, excluding study material, coaching and retakes. And a single failed attempt costs more than the whole gap between early and standard registration, which argues for registering early and then preparing as though you only get one attempt. Verify both tables on the CFA Institute and GARP websites before registering, because both bodies reprice between cycles.
On earnings, published entry level ranges for the two overlap heavily, and the spread inside each range is wider than the gap between them. What moves a candidate within the range is employer type, location, prior experience and the technical skills carried alongside the exam. The credential gets the application read. It does not set the number.
Choosing between them
The right answer varies, and it depends on four things.
- Your intended function. Do you want to decide what to own, or to price and control what can go wrong with what is already owned?
- Your starting point. A fresher faces a different opportunity set from someone already inside a bank, an advisory firm or a rating agency.
- Your time horizon. The CFA Program runs three to four years including the experience requirement. The FRM exams take one to two years, though certification still waits on the experience.
- Your comfort with quantitative work. The FRM stays quantitative from the first module to the last. There is no section of it where that eases off.
There is a fifth test, and it is the most useful hour you will spend on this decision. Open 20 live job postings for the role you want, and count which credential appears in the requirements.
Whether to do both
The overlap is real. Quantitative methods, fixed income, derivatives, corporate finance and portfolio management appear in both, so the second programme costs less effort than the first, and holding both is useful for senior risk or investment roles.
We want to be careful here, because this is where the advice usually turns optimistic. The two complement each other. They do not combine into a job guarantee, and stacking a second certification is a poor answer to not getting interviews after the first.
We have been writing about FRM and CFA career outcomes since 2015 and 2016, when very few people were writing honestly about job trends. We did not paint an optimistic picture then, because the market did not support one. It is against our own commercial interest to say that a certification alone may not directly get you a job, and we have said it anyway.
If you are early and undecided, start with CFA Level 1. It builds the broadest foundation, and much of it carries directly into FRM Part 1 if you later decide risk is where you want to be.
The short version
- The CFA asks what an asset is worth. The FRM asks how much can be lost on it and whether that estimate holds.
- CFA Level 1 covers 10 topics. FRM Part 1 covers four modules and Part 2 covers six different ones.
- Official guidance is about 300 hours per CFA level and about 240 hours per FRM part. We recommend around 600.
- That lands as 25 hours a week for 20 weeks, then 30 hours a week for a final revision month.
- Exam fees run USD 3,520 to 4,570 for the CFA Program and USD 1,600 to 2,000 for the FRM.
- Passing FRM Part 1 does not make you an FRM, and neither credential sets your salary.
Frequently Asked Questions
Which is harder, the FRM or the CFA?
They are hard in different directions. The CFA Program is harder in breadth and endurance, because it runs across three levels and several years. The FRM is harder in quantitative depth per hour. A candidate strong in statistics often finds FRM Part 1 more approachable than CFA Level 1, and a candidate strong in accounting finds the reverse.
Can I prepare for the CFA and the FRM at the same time?
The curricula overlap in quantitative methods, fixed income, derivatives, corporate finance and portfolio management, so the second costs less effort than the first. Preparing for both in one window is a different matter, because each needs around 600 hours to be done properly. Take them in sequence, usually starting with CFA Level 1.
How many hours does FRM Part 1 actually need?
GARP publishes that candidates typically spend around 240 hours, with reported study time ranging from under 100 to more than 400. We recommend around 600 hours for candidates who want the job and not only the certificate. If your basics are strong, 250 to 300 hours can be enough to pass, but the gaps reappear in Part 2 and in interviews.
Does passing FRM Part 1 make me an FRM?
No. Certification requires passing both parts and then demonstrating two years of relevant professional financial risk management experience, within five years of passing Part 2. Until that experience is submitted and accepted, the accurate description is that you have passed FRM Part 1, or both parts, not that you are an FRM.
Is the FRM or the CFA better for someone with no work experience?
The CFA generally opens a wider set of doors, simply because more roles are written against it. The FRM is narrower by design, which is an advantage once you are inside a risk function and a constraint when applying from outside one. If risk is already the settled goal, the FRM is the right choice regardless.
Is there negative marking in the FRM exam?
No, neither part carries negative marking, which means an educated guess is better than leaving a blank. Part 1 is 100 multiple choice questions in 4 hours and Part 2 is 80 questions, both computer based.
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