Prerequisites for Financial Risk Manager- The Knowledge Perspective

Objective 

The objective of the study is concerned with the knowledge prerequisites required for the Financial Risk Manager (FRM) course offered by the Global Association for Risk Professionals (GARP). 

Content

The article is divided into three components, 

1. The analysis of Knowledge components
2. Crucial Factors 
3. Conclusion

1. The analysis of Knowledge components 

Knowledge is quite a broad term, and we will filter the broad spectrum into relevant subject areas that can be interlinked with the FRM examination. 

The following are the relevant subject areas, and their specific analysis, which is as follows,  

i. Basic Written English  

The Language used is Basic English and one needs to understand the language to understand the questions asked in the FRM examination. The exam is conducted only in the English language across the testing locations. 

ii. Quantitative Aptitude 

       The FRM examination consists of lots of Formula derived with the application of calculus and advanced-level mathematics, but the FRM exam does not ask for the direct derivation of Formulas, just the application of concepts & formulas is asked, that require Basic mathematics knowledge i.e., Elementary Mathematics. 

iii. Financial acumen        

The FRM is a specialized risk management designation, and most aspirants wonder if a strong understanding of Finance and Accountancy is a prerequisite from the knowledge dimension, but in contrast, no such requirement is mandatory although preferred, as the content explains the concepts from scratch and interlinks with sequential progression. 

2. Crucial factors as a prerequisite 

There are some crucial factors that when complimented with the knowledge prerequisites enhance the learning efficiency. “Logical thinking” and “Common Sense” are those crucial factors that will make the learning process much more efficient.     

3. Conclusion 

Based on the discussion above we can conclude that a basic understanding of Written English, Quantitative Aptitude & Finance is required, and when these prerequisites are combined with crucial factors as suggested above, the learning process for the FRM curriculum enhances significantly.