A Guide to Interpreting FRM Results

You have completed your FRM exams, and now you need to decipher all the numbers and what those scores mean. What do the numbers, quartiles, and percentiles mean? If you are staring at your FRM results, scratching your head, and trying to figure out how well you really did-you are not alone. Sometimes it feels like a puzzle to read these results. Don’t worry! In this guide, we’ll break down everything you need to know to understand your FRM results and use them to chart your path forward. Let’s turn confusing scores into clear insights!

What Does My FRM Result Mean?

Being able to understand your FRM examination result will go a long way in helping you assess your performance and look ahead. Here’s how to interpret what the result means:

1. Scaled Scores

Scaled scores are adjusted to account for variations in exam difficulty. This ensures that scores are comparable across different exam sessions. The number of correct answers given by you is converted to a scaled score. This conversion is designed to reflect your performance relative to the overall exam population.

2. Percentile Rank

Your percentile rank tells how well you performed compared to other candidates. For example, a score in the 70th percentile means you performed better than 70 percent of test-takers. Higher percentile rank means better performance. The passing percentile differs in each session.

3. Pass/Fail Status

A “pass” indicates that you achieved at least the minimum percentile score. A “fail” means that your score did not reach the passing percentile. In this case, access your performance for further preparation.

4. Score Breakdown

Your score may contain performance by section breakdown. This will give you some idea about where you were relatively strong or weak. Such information can be used to concentrate on specific sections or topics for your studies in subsequent attempts.

Difficulty in Estimating FRM Passing Score

FRM passing score is difficult to estimate for the following reasons:

1. Variability in Exam Difficulty

Each testing session may vary in terms of the difficulty level of questions; this creates some complications in scaling. In other words, the passing score will be different for each exam session depending on the difficulty level the test happened to be for all candidates.

2. Percentile-Based Scoring

The passing score is not a fixed percentage but rather a percentile rank reflecting relative performance. The exact percentile is determined by comparing your performance to that of all candidates who sat for the same test.

3. Scaling Adjustments

Scaled scores are an adjustment due to the differences in difficulties and the performance of test-takers. For this reason, it is quite challenging to predict the exact number of passing by achieving a certain score in a given exam session without any type of official data.

4. Variability in Candidate Performance

The threshold of the passing score would be affected by the overall candidate’s performance. In that respect, it is impossible to estimate the exact passing mark until all the results are analyzed.

What Does Quartile Range Mean in Results?

The quartile range is a statistical tool that helps indicate how scores are spread out in a data set. Here’s how the quartile range applies to your test scores:

1. Understanding Quartiles

Definition: Quartiles represent the comparative rank of a value in a dataset that divides the data into four equal parts. These include the:

First Quartile (Q1): The 25th percentile; 25% of the scores are ranked below this value.

Second Quartile (Q2): The 50th percentile or median; 50% of the scores fall below this value. 

Third Quartile (Q3): The 75th percentile; 75% of the scores fall below this value. 

Fourth Quartile (Q4): The 100th percentile; 100% of the scores fall below this value.

2. Interquartile Range (IQR):

The interquartile range is the range between the first quartile, Q1, and the third quartile, Q3. It is calculated as:

IQR = Q3 – Q1

Purpose: IQR provides a measure of the spread of the middle 50% data. It is beneficial in identifying variability or dispersion within the dataset.

3. Application Exam Results

Quartile Range: If your exam results are reported in quartiles, it means that the position of your score is indicated in relation to the distribution of all the scores for candidates who took the test. 

For example, being in the 2nd quartile means you performed better than the bottom 50% but your performance is not among the top 25%.

Interquartile Range of Performance: Basically, the interquartile range is when your score falls in the middle 50% of the scores, not at the extremes. This enables one to understand the performance relative to most other candidates.

4. Quartile Range Understanding:

Comprehension of your standing of performance in relation to others is facilitated by knowing the quartile range. Highlight whether you are in the low, medium, or high range of scores to point out where improvement is needed.

FRM Course Outline

FRM is a financial risk management certification course that has been developed by GARP. The course addresses some of the most important aspects of financial risk management. FRM course outline is mentioned below highlighting all the key points:

FRM Part 1: 

Foundations of Risk Management: Introduces key risk management concepts and builds a foundation for the course.

Quantitative Analysis: Basic statistical and mathematical techniques used in risk management.

Financial Markets and Products: Overview of financial markets, instruments, and products including derivatives, bonds, and equities.

Valuation and Risk Models: Valuation of financial instruments and modeling risks, including Value-at-Risk and other measures for quantifying risk. 

FRM Part 2: 

Market Risk Measurement and Management: Measurement and management of market risks, including models for assessing risks.

Credit Risk Measurement and Management: Tools and methodologies related to credit risk assessment and management. 

Operational Risk and Resilience: How to handle operational risk and make sure the organization is resilient. 

Liquidity and Treasury Risk Management: How to manage liquidity and treasury risk. 

Risk Management and Investment Strategies: Use of various risk management techniques in developing investment strategies and managing portfolios. 

3. FRM Study Materials 

Core Textbooks: FRM core textbooks and study guides published by GARP, Global Association of Risk Professionals.

Practice Exams: Mock exams and practice questions to simulate the exam environment and test your knowledge. 

Online Courses: Comprehensive online courses offering video lectures, interactive quizzes, and additional resources. 

Study Groups: Joining study groups for collaborative learning and discussion. 

FRM Part 1 Breakdown

FRM Part 2 Breakdown

FRM Passing Percentage

GARP does not officially publish the minimum FRM passing percentages. Instead, in determining passing scores, GARP relies on a scaled scoring system. The actual required passing percentage may go up or down each year because of changes in exam format difficulty or the performance of other candidates.

Typically, the FRM passing score is set around the 60th to 65th percentile of the candidate population. This means that for passing, you generally need to perform better than approximately 60% to 65% of the candidates.

FRM Result Date

FRM Level 1 Results: The results are usually released approximately 6 weeks after the exam date.

FRM Level 2 Results: Results are usually available approximately 8 weeks after the exam date.

How Can Zell Education Help You Pass FRM?

Zell Education offers comprehensive FRM preparation courses where you will gain great knowledge to master the curriculum and pass the exam. These expert-led classes include practice exams and study materials prescribed in the FRM syllabus. With personal coaching and feedback, Zell Education makes sure you confidently take on Level 1 and Level 2 exams with no hassle.

Conclusion

Understanding your FRM results is one of the most important ways to realize your performance and where you need to work. You can focus on some of the key metrics like quartile ranges and scaled scores to get important insights into your exam performance compared to other candidates. 

Equipped with knowledge at your fingertips, you will have ample ability to fine-tune your study strategy, bridge your weaknesses, and set up yourself for subsequent exams in a much better way. Depending on whether you are trying to retake the exam or just want to improve your risk management skills, the clear vision of your FRM result will point you toward the road to success.

FAQ’s on A Guide to Interpreting FRM Results

How is the FRM result calculated?

The FRM result follows a scaled scoring system whereby your performance will be compared to a pre-specified standard. The passing score depends on the percentile ranking of candidates, which is different every year.

Is FRM harder than CFA?

FRM and CFA vary in their topics; FRM is purely on risk management, while CFA is on a broad coverage of finance. The difficulty level would remain subjective because everything depends on the candidate’s strength and preparation.

How are FRM exams graded?

The FRM exams use scaled scoring, where raw scores are converted to scaled scores. This scaling maintains fairness across the different versions of exams and maintains consistent standards.

What is a good FRM score?

A good FRM score normally lies above the 60th percentile of the candidate population. Passing status is determined by scaled scores, and performing above the median usually means favorable performance.

Partham Barot is an ACCA-certified professional. showcasing his expertise in finance and accountancy. he’s revolutionising education by focusing on practical, real-world skills. Partham’s achievements underscore his commitment to elevating educational standards and empowering the next generation of professionals.