FRM Difficulty vs CFA

Comparison of FRM difficulty vs CFA enables financial professionals to make an informed decision concerning which exam is more difficult.

Introduction: How Do the CFA and FRM Exams Compare in Difficulty?

While making a comparison between FRM difficulty vs CFA, it becomes apparent that both of them qualify as among the most difficult finance qualifications globally. However, the CFA level difficulty differs. The CFA exam stands out, as it encompasses a broad syllabus that comprises various segments of finance. The FRM exam, on the other hand, requires depth in quantitative risk management.

The two courses depend on your background and profession. To identify which is more challenging between the two, we can discuss their structure, syllabus, and how you prepare for both of them.

What Are the CFA and FRM Programs?

What Is the CFA Exam?

The CFA exam is offered by the CFA Institute. The levels of the CFA exam are Level I, II, and III. The CFA exam is primarily designed for professionals in the field of investment management, equity research, or financial analysis.

The syllabus covers:

• Ethics and professional standards
• Quantitative methods
• Economics
• Corporate finance
• Equity, fixed income, derivatives, and portfolio management

The broad range of topics also adds to the CFA level difficulty, as it requires individuals to understand multiple concepts and apply them.

What Is the FRM Exam?

The FRM programme is overseen by GARP (Global Association of Risk Professionals). The programme consists of two sections, which assess your knowledge of financial risk concepts. These sections encompass FRM Part I and Part II.

The what is frm course question can be answered simply: it’s a professional certification programme designed for those individuals acquiring skills in handling market, credit, or operation risks.

Its syllabus includes:

• Foundations of risk management
• Quantitative analysis
• Financial markets and products
• Valuation and risk model
• Risk management and investment management

The FRM is more narrowly focused than the CFA course, though it is considerably more quantitative, which impacts how individuals rank FRM vs CFA difficulty.

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How Do the CFA and FRM Exams Differ in Structure and Levels?

Number of Levels and Exam Duration

The CFA exam is divided into three levels – Level I, II, and III. The exam is scheduled multiple times a year by the CFA Institute. Typically, it will take a candidate anything between 2.5 and 4 years to complete all three levels, based on their schedule. Each level becomes more complex than the previous one. For instance:

• Level I focuses on basic knowledge and understanding of finance fundamentals.
• Level II emphasises application through item-set case studies.
• Level III tests synthesis and judgement, often through essay-type (constructed response) questions.

This progressive design requires that not only memory but also comprehension as well as concept incorporation on all levels of finance be assessed. It is no wonder that levels of CFA become increasingly difficult after level I.

The FRM exam, on the other hand, is divided into two parts, FRM Part I and FRM Part II, which can be pursued simultaneously or in succession. Motivated individuals can attempt both parts within 1-2 years if they clear it in the first attempt. FRM Part I provides training on basic quantitative methods, risk models, and valuation approaches. 

The second part of the programme applies all this knowledge to practical risk management issues, including credit, marketplace, and operational risks. Regarding the comparison of level of difficulty between FRM vs CFA difficulty, it is clear that CFA is a more lengthy or extensive process owing to its three levels, broad syllabus, and tough criteria for passing. 

The FRM exam, though shorter, is more technical in its orientation – the difficulty does not lie in its length anymore but in understanding or implementing complex quantitative concepts.

Question Format and Assessment Style

The question structure also contributes to perceived FRM vs CFA difficulty.

• CFA Exam Format:
  • Level I: Multiple-choice questions testing foundational knowledge
  • Level II: Item sets (mini case studies)
  • Level III: Essay-style (constructed response) and case-based questions
• FRM Exam Format:
  • Both Part I and Part II: Multiple-choice questions focusing on application-based scenarios

Even though the CFA tests skills in writing and levels of analysis, the FRM tests concepts and quant skills. Based on this, FRM difficulty vs CFA will depend on which area you consider more difficult, writing or quantitative problem-solving.

What Makes the CFA and FRM Exams Difficult?

Syllabus Breadth and Depth

Syllabus structure is one of the most significant factors that make a difference between levels of FRM vs CFA difficulty.

• CFA: Has a wide CFA syllabus covering nearly every domain of finance. Candidates must manage topics like ethics, portfolio management, alternative investments, and derivatives.
• FRM: Focuses narrowly on risk management and quantitative topics such as probability, statistics, and financial modelling.

As a result, the CFA exam provides you with breadth, while the FRM exam provides you with depth in quantitative knowledge, which is equally difficult but in a different manner.

Conceptual vs Quantitative Focus

While considering FRM vs CFA difficulty, it is very important to note that FRM certification is more quantitative. You will be working with complex formulas, models of probability, and analyses.

The CFA requires an understanding of finance concepts, valuations, and ethics. The maths requirement of the FRM exam becomes intuitive if one has solid quantitative skills. However, if one has good conceptual or analytical skills, then the CFA exam will not be so difficult.

This accounts for why FRM difficulty vs CFA Level II requires consideration of the candidate’s academic experience and professional experience.

Study Time and Preparation Requirements

Another key factor influencing FRM difficulty vs CFA is the study time required.

• CFA: Each level typically demands 300–400 study hours, adding up to over 1,000 hours across all three levels.
• FRM: Each part requires about 200–250 hours, making it roughly 500 hours in total.

Therefore, from the time standpoint, CFA needs almost twice as much time. However, it is equally tough given the intense quantitative section of the FRM. Many will say that the CFA level difficulty becomes more intense from Level II to III, where conceptual integration starts becoming important.

Pass Rates and Global Competition

Pass rates are a direct reflection of difficulty.

• CFA Exam:
  • Level I: ~40%
  • Level II: ~45%
  • Level III: ~50–55%
• FRM Exam:
  • Part I: ~45–50%
  • Part II: ~55–60%

Although there seem to be more passes in the FRM, this could be influenced by the fact that there are fewer individuals participating, most of whom come from a quant background. The CFA, with its huge population, seems more challenging, as it requires more skills.

Which Exam Is Harder When You Consider Career Goals?

CFA for Investment and Portfolio Management

If your interest is in investment management, equity research, or portfolio management, then the CFA programme would be more appropriate. The CFA programme provides a holistic understanding of financial markets and investment ethics, which is an important requirement in the field of asset management.

However, since it is broad, the difficulty level FRM vs CFA comparison will more often show CFA as more challenging than FRM.

Source of Reference for CFA Course Details featured in the blog – CFA Institute

FRM for Risk and Financial Analysis

The FRM exam is specific training for professionals in risk management, regulatory compliance, or quantitative finance. The exam is divided into two parts that emphasise the skills of financial risk assessment and quantitative risk management.

Although CFA can give you access to various finance career opportunities, FRM is the more popular programme among professionals wanting specific quantitative or risk-focused positions. Based on your interests, you may find one more challenging than the other. For most people, it would be FRM, which focuses on quantity, or CFA, which encompasses various concepts.

Source of Reference for CFA Course Details featured in the blog – GARP

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Conclusion: CFA vs FRM – Which Should You Choose?

After comparing both the FRM difficulty vs CFA, it’s clear that both are difficult, though in different ways.

• CFA is broader, lengthier, and demands sustained commitment. It’s ideal for careers in investment management, portfolio analysis, and corporate finance.
• FRM is shorter but denser, with a stronger focus on quantitative modelling and risk management.

If you like conceptual finance, then opt for CFA certification. If you enjoy stats, data analysis, or modelling, then FRM could be a better fit.

Ultimately, your perception of FRM vs CFA difficulty depends on your strengths:

• Analytical and writing skills: CFA
• Mathematical and problem-solving skills: FRM

Both of these certifications are highly respected globally. While picking the right one between the two, it’s not a matter of which one is “easier”.

FAQs on FRM Difficulty vs CFA

Which exam is tougher: CFA or FRM?

Most candidates consider CFA slightly harder because of its broader syllabus and three-level structure. FRM is shorter but quantitatively intense, making it tough for those without a math background.

Is the FRM exam more quantitative than the CFA exam?

Yes. The FRM programme encompasses more quantitative risk management, derivatives, and statistics, while the CFA programme encompasses more finance concepts.

Can I pursue both CFA and FRM together?

Yes, many professionals choose both courses to gain knowledge of investments as well as risk. Time management of study is an important task to cope with the overall level of FRM vs CFA.

Which has higher pass rates, CFA or FRM?

The overall pass rate of FRM is slightly higher than that of the CFA levels on a per-part level, though CFA is more difficult given its longer series of levels.

Current Role

Co-Founder & CEO at Zell Education

Education

• ACCA – Association of Chartered Certified Accountants, Finance (2011 – 2014)
• Bachelor of Commerce (BCom), Financial Markets from H.R. College Of Commerce & Economics (2010 – 2013)

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Mumbai, India

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ACCA Certified