About the FRM
As the CFA is traditionally linked to an equity analyst, the FRM traditionally served to credentialize a risk manager at a bank. As proof, consider GARP now starts their advertising with "The FRM is not just for risk professionals in banks." Both organizations (CFA Institute and GARP) are actively seeking to broaden their appeal, and in my view they are both succeeding. But the CFA is further along.

I would say that the job market for an FRM is less concretely defined than the market for a CFA. When I talk to people, almost everybody knows what the CFA is. It continues to surprise me that not everybody knows what the FRM is! And if they don't know what it is, then it follows they don't know how much pain it took to earn it. Further, where it is common to see "Chartered Financial Analyst" as a job preference or job requirement, I cannot remember the last time I saw "FRM preferred or required."

But this is mostly due to the relative youth of the FRM credential. Risk is a hot topic and the FRM has a very bright future. Academic institutions are a rapidly growing FRM constituency. Both the CFA Institute and GARP (who administers the FRM) actively seek to partner with universities. Also, regulatory bodies. Even energy companies. And most recently, insurance companies. (In addition to the original constituencies, commercial banks and central/regulatory banks).

I would say that, against the traditional risk manager job market, the FRM is a solid and valued credential. But some qualifiers:

Unlike the CFA which has no direct competition, the FRM has direct competition in the Professional Risk Manager (PRM) certification (so you have two choices for a risk designation)
If you want to be an equity analyst, the CFA might be all you need (I would argue it is a pinnacle designation for many careers). At the moment, the FRM is generally (in my opinion) a complementary sort of credential, not a destination unto itself.
As mentioned before, GARP is growing fast (20-30% per year) so they don't have a continuing education program yet. Their online resources are coming into their own. And, where the CFA Curriculum is a case study in purposeful, well-organized content, the FRM is a bit uneven in areas (e.g., some of the quant readings are stale; operational risk it tough to cover and it shows). These "growing pain" challenges aside, I am partial to the FRM: I think the five competencies (quantitative, market risk, credit risk, operational risk, and investment risk) provide a great blend of both foundation and cutting-edge theory. So, you get exposed to the traditional stuff (e.g., portfolio theory,fixed income) but, at the other end of the spectrum, you get to grapple right along with GARP as they grapple with the definition of a new frontier (what is operational risk, after all?) and as they systemize very timely content (e.g., credit derivatives).

Next post, I'll compare the actual exams...



Yesterday, I compared job markets served by the CFA and the FRM. Here, I will compare the actual exam contents of the CFA and the FRM. I listed out the major topics and slotted them into the Venn diagram below. Bold indicates an exclusive emphasis (e.g., the CFA has deep content on financial statement analysis, the FRM has none. On the other hand, the FRM has deep coverage of Basel II, while the CFA doesn't mention it). A regular (not bold) is not an exclusive emphasis. For example, asset allocation is covered by the CFA; it is referenced in the FRM, but not really with a robust set of learning outcomes. Similarly, the FRM covers credit risk models with, collectively, quite a few learning outcomes; the CFA does refer to credit portfolio models, but not in much depth.

In the middle is the overlap, those topics where I find the exams to have much in common: basic statistics, volatility & correlation, fixed income, introduction to corporate finance (formalized in the CFA and referenced in piecemeal in the FRM), intro to derivatives, intro to credit risk, credit derivatives, intro to hedge funds, factor models and risk/return metrics (e.g., Sharpe, information ratio).

The above is a high-level topical comparison. But note another key difference. A difference that is important to, say, a CFA candidate studying for the FRM: the FRM is all about the risk perspective and the application of risk tools. An example might help:

The CFA itemizes basic credit derivatives like a credit default swap (CDS) or a total rate of return (TROR). Here, to generalize, the emphasis would be on understanding the mechanics of a CDS
In the FRM, the study of a CDS, I like to say, should happen in two passes: first, to get the mechanics. Second, to analyze the risk transfer (which risks are transferred and which are not? and how does this compare to other financial arrangements that could be used instead).
That is just to say the obvious: that the CFA is about academic mastery (and then some) while the FRM tries very hard to be about the practice of risk measurement and management. For each of the shared topics, this gives rise to a different "angle of approach."

Chartered Financial Analyst (CFA)
The CFA is three exams (Levels I, II, and III). Collectively, it is much broader than the FRM. Here is the topical arrangement:



Topic Area  Level I (%)  Level II (%)  Level III (%)  
Ethics 15  10  10  
Quantitative Methods  12  5-10  0  
Economics  10  5-10  0  
Financial Reporting & Analysis  20  15-25  0  
Corporate Finance  8  5-15  0  
Investment Tools (total)  50  30-60  0  
Equity Investments  10  20-30  5-15  
Fixed Income  12  5-15  10-20  
Derivatives  5  5-15  5-15  
Alternative Investments  3  5-15  5-15  
Asset Classes (total)  30  35-75  35-45  
Portfolio Management & Wealth Planning (total)  5  5-15  45-55  
Total  100  100  100  






Financial Risk Manager (FRM)
The FRM is only one exam, but in my estimation, it is about 150% to 175% more difficult than either the Level I or Level II CFA. It goes deeper into quantitative methods and some of the exam questions can be surprisingly hard. Here is the topical arrangement (based really on 2007, but should hold up pretty well for 2008):

Topic Area  Weight  
Quantitative Analysis 10%
Probability   
Volatility & Correlation   
Extreme value theory (EVT)   
Linear regression   
Market Risk Measurement & Management 25%
Fixed income  
Derivatives (futures, options, swaps)   
Value at risk (VaR)   
Market risk   
Cash flow at risk (CFaR or CaR)   
Credit Risk Measurement & Management 30%
Counterparty risk & Securitization   
Credit risk (ratings, LGD, credit portfolio models)   
Economic capital   
Loan portfolio   
Credit derivatives (e.g., CDS, CLN, TROR, CDO)   
Operational and Enterprise Risk, Legal & Ethics 25%
Operational risk   
Model risk   
Case studies (e.g., Amaranth, LTCM)   
Other TBD (2008)   
Basel II Accord significant
Investment Management Risk 10%
Factor models (multi-factor, CAPM)   
Hedge fund strategies & styles (& HFoF)   
Portfolio VaR   
Other TBD (2008)

建議二級考完可再準備FRM              可省不少時間

不是很新的文章(FRM早就分级了，不过还是可以一天搞定)，但是写得很好。
有几点我不太赞成，当属个人意见，希望楼主不要见怪：
一、就是金融工程和CFA/FRM的对比。这根本就是金融的不同方向，且金融工程主要是前台，偏重编程与计算方法。当然risk里面也有很多金工的，但是难度和重心不一样。这种比较容易混淆视听，不能以不同层次的需求判定CFA/FRM的前景。
二、FRM不见得比CFA二级难多少，这跟考生背景有关系。一个财务的出生的考FRM肯定会觉得很难，但是一个理工出生的考CFA未必简单到哪里，理工科学生对于大量繁冗复杂的规则不敏感。归根到底是两个考试的侧重点不一样。
三、还有就是对于两个证书的认可度的问题，我觉得LZ应该给不同的样本不同的权重而非一概而论。FRM确实是以商业银行风险管理为主的，涉及面不如CFA广，知道的人少不足为奇。因为这个就说FRM需求不大，就好比去调查技术部门对于销售的需求一样，肯定会有偏差的。

楼上说的对，都说FRM数学比较难。可是我对那些东西都没什么感觉，相当基础。

都涉及到什么样的基础（数学）？