FRM^® Study Modules

(p 1-20)
Chapter 1: The Building Blocks of Risk Management

(p 21-38)
Chapter 2: How Do Firms Manage Financial Risk?

(p 103-122) 
Chapter 8: Enterprise Risk Management and Future Trends

(p 39-60) 
Chapter 3: The Governance of Risk Management

(p 93-102)
Chapter 7: Risk Data Aggregation and Reporting Principles

(p 73-84) 
Chapter 5: Modern Portfolio Theory (MPT) and the Capital Asset Pricing Model (CAPM)

(p 85-92) 
Chapter 6: The Arbitrage Pricing Theory and Multifactor Models of Risk and Return 

(p 61-72) 
Chapter 4. Credit Risk Transfer Mechanisms 

(p 123-140) 
Chapter 9: Learning from Financial Disasters 

(p 141-152) 
Chapter 10: Anatomy of the Great Financial Crisis of 2007-2009 

(p 153-156) 
Chapter 11: GARP Code of Conduct* 

(p 1-10) 
Chapter 1: Fundamentals of Probability 
 
(p 11-26) 
Chapter 2: Random Variables 
 
(p 27-46) 
Chapter 3: Common Univariate Random Variables 
 
(p 47-62) 
Chapter 4: Multivariate Random Variables 
 
(p 63-82) 
Chapter 5: Sample Moments 

(p 213-224) 
Chapter 12: Measuring Returns, Volatility, and Correlation 

(p 83-100)
Chapter 6: Hypothesis Testing

(p 101-120)
Chapter 7: Linear Regression

(p 121-140)
Chapter 8: Regression with Multiple Explanatory Variables

(p 141-160)
Chapter 9: Regression Diagnostics

(p 161-188) 
Chapter 10: Stationary Time Series 
 
(p 189-212) 
Chapter 11: Non-Stationary Time Series 
 
(p 225-240) 
Chapter 13: Simulation and Bootstrapping 
 
(p 241-256) 
Chapter 14: Machine-Learning Methods 
 
(p 257-277) 
Chapter 15: Machine Learning and Prediction 

(p 1-14)
Chapter 1: Banks

(p 15-30)
Chapter 2: Insurance Companies and Pension Plans

(p 31-44)
Chapter 3: Fund Management

(p 57-70)
Chapter 5: Exchanges and OTC Markets

(p 71-82)
Chapter 6: Central Clearing

(p 45-56) 
Chapter 4. Introduction to Derivatives 
 
(p 83-94) 
Chapter 7: Futures Markets 
 
(p 95-108) 
Chapter 8: Using Futures for Hedging 
 
(p 109-122) 
Chapter 9: Foreign Exchange Markets 

(p 123-134) 
Chapter 10: Pricing Financial Forwards and Futures 
 
(p 135-146) 
Chapter 11: Commodity Forwards and Futures 

(p 147-158)
Chapter 12: Options Markets

(p 159-170)
Chapter 13: Properties of Options

(p 171-182)
Chapter 14: Trading Strategies

(p 183-194)
Chapter 15: Exotic Options

(p 195-212)
Chapter 16: Properties of Interest Rates

(p 213-224)
Chapter 17: Corporate Bonds

(p 225-240)
Chapter 18: Mortgages and Mortgage-Backed Securities

(p 241-254)
Chapter 19: Interest Rate Futures

(p 255-270)
Chapter 20: Swaps

(p 1-14)
Chapter 1: Measures of Financial Risk

(p 15-26)
Chapter 2: Calculating and Applying VaR

(p 27-40)
Chapter 3: Measuring and Monitoring Volatility

(p 41-54) 
Chapter 4. External and Internal Ratings 
 
(p 69-84) 
Chapter 6: Measuring Credit Risk 

(p 55-68)
Chapter 5: Country Risk: Determinants, Measures, and Implications

(p 85-98)
Chapter 7: Operational Risk

(p 99-114)
Chapter 8: Stress Testing

(p 115-126) 
Chapter 9: Pricing Conventions, Discounting, and Arbitrage

(p 127-138) 
Chapter 10: Interest Rates

(p 139-150) 
Chapter 11: Bond Yields and Return Calculations

(p 151-164) 
Chapter 12: Applying Duration, Convexity, and DV01

(p 165-176) 
Chapter 13: Modeling Non-Parallel Term Structure Shifts and Hedging 

(p 177-188)
Chapter 14: Binomial Trees

(p 189-202)
Chapter 15: The Black-Scholes-Merton Model

(p 203-218)
Chapter 16: Option Sensitivity Measures: The “Greeks”

(p 1-16)
Kevin Dowd, Measuring Market Risk, 2nd Edition (West Sussex, England: John Wiley & Sons, 2005). Chapter 3. Estimating Market Risk Measures: An Introduction and Overview

(p 17-34)
Kevin Dowd, Measuring Market Risk, 2nd Edition (West Sussex, England: John Wiley & Sons, 2005). Chapter 4. Non-parametric Approaches

(p 35-48)
Kevin Dowd, Measuring Market Risk, 2nd Edition (West Sussex, England: John Wiley & Sons, 2005). Chapter 7. Parametric Approaches (II): Extreme Value

(p 49-58)
Philippe Jorion, Value-at-Risk: The New Benchmark for Managing Financial Risk, 3rd Edition (New York: McGraw-Hill, 2007). Chapter 6. Backtesting VaR

(p 59-72)
Philippe Jorion, Value-at-Risk: The New Benchmark for Managing Financial Risk, 3rd Edition (New York: McGraw-Hill, 2007). Chapter 11. VaR Mapping

(p 73-104)
“Messages from the academic literature on risk measurement for the trading book,” Basel Committee on Banking Supervision, Working Paper, No. 19, Jan 2011.

(p 105-124)
Gunter Meissner, Correlation Risk Modeling and Management, 2nd Edition (London: Risk Books, 2019). Chapter 1. Correlation Basics: Definitions, Applications, and Terminology

(p 125-132)
Gunter Meissner, Correlation Risk Modeling and Management, 2nd Edition (London: Risk Books, 2019). Chapter 2. Empirical Properties of Correlation: How Do Correlations Behave in the Real World?

(p 133-138)
Gunter Meissner, Correlation Risk Modeling and Management, 2nd Edition (London: Risk Books, 2019). Chapter 5. Financial Correlation Modelling – Bottom-up Approaches

(p 139-154)
Bruce Tuckman and Angel Serrat, Fixed Income Securities: Tools for Today's Markets, 3rd Edition (Hoboken, NJ: John Wiley & Sons, 2011). Chapter 6. Empirical Approaches to Risk Metrics and Hedges

(p 155-166)
Bruce Tuckman and Angel Serrat, Fixed Income Securities: Tools for Today's Markets, 3rd Edition (Hoboken, NJ: John Wiley & Sons, 2011). Chapter 7. The Science of Term Structure Models

(p 167-174)
Bruce Tuckman and Angel Serrat, Fixed Income Securities: Tools for Today's Markets, 3rd Edition (Hoboken, NJ: John Wiley & Sons, 2011). Chapter 8. The Evolution of Short Rates and the Shape of the Term Structure

(p 175-186)
Bruce Tuckman and Angel Serrat, Fixed Income Securities: Tools for Today's Markets, 3rd Edition (Hoboken, NJ: John Wiley & Sons, 2011). Chapter 9. The Art of Term Structure Models: Drift

(p 187-192)
Bruce Tuckman and Angel Serrat, Fixed Income Securities: Tools for Today's Markets, 3rd Edition (Hoboken, NJ: John Wiley & Sons, 2011). Chapter 10. The Art of Term Structure Models: Volatility and Distribution

(p 193-202)
John C. Hull, Options, Futures, and Other Derivatives, 10th Edition (New York: Pearson, 2017). Chapter 20. Volatility Smiles

(p 203-210)
John C. Hull, Risk Management and Financial Institutions, 5th Edition (Hoboken, NJ: John Wiley & Sons, 2018). Chapter 18. Fundamental Review of the Trading Book

(p 1-10) 
Sylvain Bouteille and Diane Coogan-Pushner, The Handbook of Credit Risk Management: Originating, Assessing, and Managing Credit Exposures (2nd Edition, Hoboken, NJ: John Wiley & Sons, 2022). Chapter 1. Fundamentals of Credit Risk

(p 11-18) 
Sylvain Bouteille and Diane Coogan-Pushner, The Handbook of Credit Risk Management: Originating, Assessing, and Managing Credit Exposures (2nd Edition, Hoboken, NJ: John Wiley & Sons, 2022). Chapter 2. Governance

(p 19-32) 
Hennie van Greuning and Sonja Brajovic Bratanovic, Analyzing Banking Risk (Fourth Edition, World Bank Group, 2020). Chapter 7. Credit Risk Management

(p 33-41) 
Gerhard Schroeck, Risk Management and Value Creation in Financial Institutions (New York, NY: John Wiley & Sons, 2002). Chapter 5. Capital Structure in Banks (pages 170-186 only)

(p 83-104) 
Aswath Damodaran, Country Risk: Determinants, Measures, and Implications – The 2022 Edition (2022) 

(p 43-55) 
Michalis Doumpos, Christos Lemonakis, Dimitrios Niklis, and Constantin Zopounidis, Analytical Techniques in the Assessment of Credit Risk: An Overview of Methodologies and Applications (Springer, 2019). Chapter 1. Introduction to Credit Risk Modeling and Assessment

(p 105-120) 
John C. Hull, Risk Management and Financial Institutions (Sixth Edition, John Wiley & Sons, 2023). Chapter 17. Estimating Default Probabilities

(p 121-130) 
John C. Hull, Risk Management and Financial Institutions (Sixth Edition, John Wiley & Sons, 2023). Chapter 19. Credit Value at Risk

(p 131-141) 
Allan Malz, Financial Risk Management: Models, History, and Institutions (Hoboken, NJ: John Wiley & Sons, 2011). Chapter 8. Portfolio Credit Risk (Sections 8.1, 8.2, 8.3 only)

(p 143-150) 
John C. Hull, Options, Futures, and Other Derivatives (11th Edition, Pearson, 2022).  
Chapter 24. Credit Risk

(p 151-168) 
John C. Hull, Options, Futures, and Other Derivatives (11th Edition, Pearson, 2022).  
Chapter 25. Credit Derivatives

(p 333-358) 
Allan Malz, Financial Risk Management: Models, History, and Institutions (Hoboken, NJ: John Wiley & Sons, 2011). Chapter 9. Structured Credit Risk 

p 169-191) 
Jon Gregory, The xVA Challenge: Counterparty Credit Risk, Funding, Collateral, and Capital (West Sussex, UK: John Wiley & Sons, 2020). Chapter 2. Derivatives

(p 193-206) 
Jon Gregory, The xVA Challenge: Counterparty Credit Risk, Funding, Collateral, and Capital, 4th Edition (West Sussex, UK: John Wiley & Sons, 2020). Chapter 3. Counterparty Risk and Beyond

(p 207-224) 
Jon Gregory, The xVA Challenge: Counterparty Credit Risk, Funding, Collateral, and Capital, 4th Edition (West Sussex, UK: John Wiley & Sons, 2020). Chapter 6. Netting, Close-out, and Related Aspects

(p 225-254) 
Jon Gregory, The xVA Challenge: Counterparty Credit Risk, Funding, Collateral, and Capital, 4th Edition (West Sussex, UK: John Wiley & Sons, 2020). Chapter 7. Margin (Collateral) and Settlement

(p 255-271) 
Jon Gregory, The xVA Challenge: Counterparty Credit Risk, Funding, Collateral, and Capital, 4th Edition (West Sussex, UK: John Wiley & Sons, 2020). Chapter 8. Central Clearing

(p 273-293) 
Jon Gregory, The xVA Challenge: Counterparty Credit Risk, Funding, Collateral, and Capital, 4th Edition (West Sussex, UK: John Wiley & Sons, 2020). Chapter 11. Future Value and Exposure

(p 295-321) 
Jon Gregory, The xVA Challenge: Counterparty Credit Risk, Funding, Collateral, and Capital, 4th Edition (West Sussex, UK: John Wiley & Sons, 2020). Chapter 17. CVA

(p 323-332) 
Akhtar Siddique and Iftekhar Hasan (eds.), Stress Testing: Approaches, Methods, and Applications, (London, UK: Risk Books, 2013). Chapter 4. The Evolution of Stress Testing Counterparty Exposures 

(p 11-18) 
Michalis Doumpos, Christos Lemonakis, Dimitrios Niklis, and Constantin Zopounidis, Analytical Techniques in the Assessment of Credit Risk: An Overview of Methodologies and Applications (Springer, 2019). Chapter 2. Credit Scoring and Rating

(p 307-320) 
Michel Crouhy, Dan Galai and Robert Mark, The Essentials of Risk Management, 2nd Edition (New York: McGraw-Hill, 2014). Chapter 9. Credit Scoring and Retail Credit Risk Management

(p 333-358) 
Allan Malz, Financial Risk Management: Models, History, and Institutions (Hoboken, NJ: John Wiley & Sons, 2011). Chapter 9. Structured Credit Risk

(p 359-378) 
Moorad Choudhry, Structured Credit Products: Credit Derivatives & Synthetic Securitization, 2nd Edition (New York: John Wiley & Sons, 2010). Chapter 12. An Introduction to Securitization 

(p 163-176)
"Sound Management of Risks related to Money Laundering and Financing of Terrorism," Basel Committee on Banking Supervision, revised July 2020. (through p.16, para. 83)

(p 3-14)
Global Association of Risk Professionals, Operational Risk and Resilience (New York, NY: Pearson, 2022). Chapter 1. Introduction to Operational Risk and Resilience

(p 177-184)
Global Association of Risk Professionals, Operational Risk and Resilience (New York, NY: Pearson, 2022). Chapter 11. Case Study: Financial Crime and Fraud

(p 185-192)
“Guidance on Managing Outsourcing Risk,” Board of Governors of the Federal Reserve System, December 2013.

(p 193-198)
Global Association of Risk Professionals, Operational Risk and Resilience (New York, NY: Pearson, 2022). Chapter 13. Case Study: Third-party Risk Management

(p 199-202)
Global Association of Risk Professionals, Operational Risk and Resilience (New York, NY: Pearson, 2022). Chapter 14. Case Study: Investor Protection and Compliance Risks in Investment Activities

(p 203-216)
“Supervisory Guidance on Model Risk Management,” Federal Deposit Insurance Corporation, June 7, 2017

(p 217-222)
Global Association of Risk Professionals, Operational Risk and Resilience (New York, NY: Pearson, 2022). Chapter 16. Case Study: Model Risk and Model Validation

(p 15-32)
Global Association of Risk Professionals, Operational Risk and Resilience (New York, NY: Pearson, 2022). Chapter 2. Risk Governance

(p 33-52)
Global Association of Risk Professionals, Operational Risk and Resilience (New York, NY: Pearson, 2022). Chapter 3. Risk Identification

(p 53-76)
Global Association of Risk Professionals, Operational Risk and Resilience (New York, NY: Pearson, 2022). Chapter 4. Risk Measurement and Assessment

(p 77-94)
Global Association of Risk Professionals, Operational Risk and Resilience (New York, NY: Pearson, 2022). Chapter 5. Risk Mitigation

(p 95-112)
Global Association of Risk Professionals, Operational Risk and Resilience (New York, NY: Pearson, 2022). Chapter 6. Risk Reporting

(p 113-132)
Global Association of Risk Professionals, Operational Risk and Resilience (New York, NY: Pearson, 2022). Chapter 7. Integrated Risk Management

(p 133-154)
“Cyber-resilience: Range of practices,” Basel Committee on Banking Supervision Publication, December 2018

(p 155-162)
Global Association of Risk Professionals, Operational Risk and Resilience (New York, NY: Pearson, 2022). Chapter 9. Case Study: Cyberthreats and Information Security Risks

(p 183-194) 
Michel Crouhy, Dan Galai and Robert Mark, The Essentials of Risk Management, 2nd Edition (New York: McGraw-Hill, 2014). Chapter 17. Risk Capital Attribution and Risk-Adjusted Performance Measurement 
 
(p 195-236) 
“Range of practices and issues in economic capital frameworks,” (Basel Committee on Banking Supervision Publication, March 2009). 
 
(p 237-266) 
“Capital Planning at Large Bank Holding Companies: Supervisory Expectations and Range of Current Practice,” Board of Governors of the Federal Reserve System, August 2013. (p 267-282) 

“Stress Testing Banks,” Til Schuermann, reprinted from the International Journal of Forecasting 30, no. 3, (2014) pp. 717–728. 

(p 323-336) 
Mark Carey, “Capital Regulation Before the Global Financial Crisis,” GARP Risk Institute, April 2019. 
 
(p 337-346) 
Mark Carey, “Solvency, Liquidity and Other Regulation After the Global Financial Crisis,” GARP Risk Institute, April 2019. 
 
(p 347-356) 
“High-level summary of Basel III reforms,” Basel Committee on Banking Supervision Publication, December 2017. 
 
(p 357-365) 
“Basel III: Finalising post-crisis reforms,” Basel Committee on Banking Supervision Publication, December 2017, pp. 128-136 

(p 1-16)
John C. Hull, Risk Management and Financial Institutions, 5th Edition (Hoboken, NJ: John Wiley & Sons, 2018). Chapter 24. Liquidity Risk

(p 381-400)
Andrew Ang, Asset Management: A Systematic Approach to Factor Investing (New York, NY: Oxford University Press, 2014). Chapter 13. Illiquid Assets

(p 17-44)
Allan Malz, Financial Risk Management: Models, History, and Institutions (Hoboken, NJ: John Wiley & Sons, 2011). Chapter 12. Liquidity and Leverage

(p 45-54)
Shyam Venkat, Stephen Baird, Liquidity Risk Management (Hoboken, NJ: John Wiley & Sons, 2016). Chapter 6. Early Warning Indicators

(p 55-86)
Peter Rose, Sylvia Hudgins, Bank Management & Financial Services, Ninth Edition (New York, NY: McGraw-Hill, 2013). Chapter 10. The Investment Function in Financial Services Management

(p 87-118)
Peter Rose, Sylvia Hudgins, Bank Management & Financial Services, Ninth Edition (New York, NY: McGraw-Hill, 2013). Chapter 11. Liquidity and Reserves Management: Strategies and Policies

(p 119-132)
Shyam Venkat, Stephen Baird, Liquidity Risk Management (Hoboken, NJ: John Wiley & Sons, 2016). Chapter 4. Intraday Liquidity Risk Management

(p 133-154)
Antonio Castagna, Francesco Fede, Measuring and Managing Liquidity Risk (United Kindom, John Wiley & Sons, 2013). Chapter 6. Monitoring Liquidity

(p 187-208)
Moorad Choudhry, The Principles of Banking Institutions (Singapore: John Wiley & Sons, 2012). Chapter 14. Liquidity Risk Reporting and Stress Testing

(p 209-220)
Shyam Venkat, Stephen Baird, Liquidity Risk Management (Hoboken, NJ: John Wiley & Sons, 2016). Chapter 7. Contingency Funding Planning

(p 221-246)
Peter Rose, Sylvia Hudgins, Bank Management & Financial Services, 9th Edition (New York, NY: McGraw-Hill, 2013). Chapter 12. Managing and Pricing Deposit Services

(p 247-272)
Peter Rose, Sylvia Hudgins, Bank Management & Financial Services, 9th Edition (New York, NY: McGraw-Hill, 2013). Chapter 13. Managing Nondeposit Liabilities

(p 155-170)
Darrell Duffie, 2010. “The Failure Mechanics of Dealer Banks,” Journal of Economic Perspectives 24:1, 51-72.

(p 171-186)
Shyam Venkat, Stephen Baird, Liquidity Risk Management (Hoboken, NJ: John Wiley & Sons, 2016). Chapter 3. Liquidity Stress Testing

(p 273-286)
Bruce Tuckman and Angel Serrat, Fixed Income Securities: Tools for Today’s Markets, 3rd Edition (Hoboken, NJ: John Wiley & Sons, 2011). Chapter 12. Repurchase Agreements and Financing

(p 287-308)
Joel Grant, 2011. “Liquidity Transfer Pricing: A Guide to Better Practice,” Occasional Paper, Financial Stability Board, Bank for International Settlements.

(p 309-332)
Patrick McGuire, Gotz von Peter, 2009. “The US Dollar Shortage in Global Banking and the International Policy Response,” BIS Working Papers, Bank for International Settlements.

(p 333-348)
Claudio Borio, Robert McCauley, Patrick McGuire, Vladyslav Sushko, 2016. “Covered Interest Rate Parity Lost: Understanding the Cross-Currency Basis,” BIS Quarterly Review.

(p 349-380)
Peter Rose, Sylvia Hudgins, Bank Management & Financial Services, Ninth Edition (New York, NY: McGraw-Hill, 2013). Chapter 7. Risk management for Changing Interest Rates: Asset-Liability Management and Duration Techniques

(p 1-12)
Andrew Ang, Asset Management: A Systematic Approach to Factor Investing (New York: Oxford University Press, 2014). Chapter 6. Factor Theory

(p 13-28)
Andrew Ang, Asset Management: A Systematic Approach to Factor Investing (New York: Oxford University Press, 2014). Chapter 7. Factors

(p 29-52)
Andrew Ang, Asset Management: A Systematic Approach to Factor Investing (New York: Oxford University Press, 2014). Chapter 10. Alpha (and the Low-Risk Anomaly)

(p 53-68)
Richard Grinold and Ronald Kahn, Active Portfolio Management: A Quantitative Approach for Producing Superior Returns and Controlling Risk, 2nd Edition (New York: McGraw-Hill, 2000). Chapter 14. Portfolio Construction

(p 69-82)
Philippe Jorion, Value-at-Risk: The New Benchmark for Managing Financial Risk, 3rd Edition (New York: McGraw-Hill, 2007). Chapter 7. Portfolio Risk: Analytical Methods

(p 83-94) 
Philippe Jorion, Value-at-Risk: The New Benchmark for Managing Financial Risk, 3rd Edition (New York: McGraw-Hill, 2007). Chapter 17. VaR and Risk Budgeting in Investment Management

(p 95-116) 
Robert Litterman and the Quantitative Resources Group, An Equilibrium Approach (Hoboken, N.J. : John Wiley, 2003). Chapter 17. Risk Monitoring and Performance Management

(p 117-146) 
Zvi Bodie, Alex Kane, and Alan J. Marcus, Investments, 12th Edition (New York: McGraw-Hill, 2020). Chapter 24. Portfolio Performance Evaluation

(p 147-186) 
G. Constantinides, M. Harris and R. Stulz, eds., Handbook of the Economics of Finance, Volume 2B (Oxford, UK: Elsevier, 2013). Chapter 17. Hedge Funds

(p 187-200) 
Kevin R. Mirabile, Hedge Fund Investing: A Practical Approach to Understanding Investor Motivation, Manager Profits, and Fund Performance (Hoboken, NJ: Wiley Finance, 2016). Chapter 12. Performance Due Diligence on Specific Managers and Funds

(p 201-228) 
Stephen G. Dimmock and William C. Gerken: Detecting Fraud by Investment Managers, Jounal of Financial Economics (2012). 

(p 0-0) 
“Review of the Federal Reserve's Supervision and Regulation of Silicon Valley Bank” (through page 66), Board of Governors of the Federal Reserve System.  

(p 0-0) 
The Credit Suisse CoCo Wipeout: Facts, Misperceptions, and Lessons for Financial Regulation.

(p 0-0) 
“Artificial Intelligence and Bank Supervision”, Federal Reserve Bank of Richmond, Second Quarter 2023.

(p 0-0) 
“Financial Risk Management and Explainable, Trustworthy, Responsible AI”, Fritz-Morgenthal S, Hein B and Papenbrock J (2022) Frontiers in Artificial Intelligence.

(p 0-0) 
“Artificial Intelligence Risk Management Framework”, National Institute of Standards and Technology.

(p 0-0) 
“Climate-related risk drivers and their transmission channels,” Basel Committee on Banking Supervision Publication, April 2021.

(p 0-0) 
“Climate-related financial risks – measurement methodologies,” Basel Committee on Banking Supervision Publication, April 2021.

(p 0-0) 
“Principles for the effective management and supervision of climate-related financial risks,” Basel Committee on Banking Supervision Publication, June 2022.

(p 0-0) 
“The Crypto Ecosystem: Key Elements and Risks,” Basel Committee on Banking Supervision Publication, July 2023.  

(p 0-0) 
“Digital Resilience and Financial Stability. The Quest for Policy Tools in The Financial Sector” (April 13, 2023). Jose Ramon Martinez, Banco de Espana.