Financial Risk Manager (FRM) Training Course.
Introduction
The Financial Risk Manager (FRM) certification is globally recognized as a benchmark for expertise in risk management. This 5-day intensive training course is designed to equip professionals with the knowledge and tools necessary to identify, assess, and manage financial risks across various sectors. With an increasing focus on global financial stability, regulatory requirements, and market volatility, this course prepares participants to handle the complexities of financial risk management. Through in-depth coverage of topics such as market risk, credit risk, operational risk, and risk modeling, participants will gain the expertise required to succeed in the FRM exam and contribute to their organization’s risk mitigation strategies.
Course Objectives
By the end of this training, participants will:
- Develop a comprehensive understanding of the four major types of financial risks: market risk, credit risk, operational risk, and liquidity risk.
- Master risk measurement and assessment techniques, including Value at Risk (VaR), stress testing, and scenario analysis.
- Learn the fundamentals of financial modeling and risk management tools used in portfolio management.
- Understand the regulatory frameworks governing financial institutions and the role of risk management in compliance.
- Gain proficiency in using advanced quantitative methods, such as Monte Carlo simulation, to measure risk and predict outcomes.
- Be fully prepared for the FRM Part I and Part II exams, covering key concepts in financial risk management.
Who Should Attend?
This course is ideal for:
- Risk professionals, analysts, and managers working in financial institutions, corporations, or consulting firms.
- Individuals looking to pursue the FRM certification and gain recognition in the field of risk management.
- Investment analysts, portfolio managers, and traders seeking to strengthen their understanding of risk management techniques.
- Professionals from accounting, finance, and economics backgrounds who wish to deepen their expertise in managing financial risks.
Day 1: Introduction to Risk Management and Market Risk
Session 1: Overview of FRM Certification
- FRM exam structure and eligibility requirements
- Key competencies in risk management: Credit risk, market risk, operational risk, and liquidity risk
- The role of a risk manager in financial institutions and corporations
Session 2: Market Risk Fundamentals
- Defining market risk and its components: Equity risk, interest rate risk, currency risk, and commodity risk
- Understanding Value at Risk (VaR): Methods of calculating VaR and its limitations
- Stress testing and scenario analysis in risk management
- Managing risk exposure through hedging strategies: Derivatives, futures, options, and swaps
Day 2: Credit Risk and Credit Derivatives
Session 3: Credit Risk Management
- Defining credit risk and its sources in financial institutions
- Credit rating systems: Internal vs. external ratings and their role in credit risk assessment
- Credit risk measurement techniques: Credit exposure, probability of default (PD), loss given default (LGD), and exposure at default (EAD)
- Credit portfolio management and diversification strategies
Session 4: Credit Derivatives and Credit Risk Modeling
- Understanding credit derivatives: Credit default swaps (CDS), collateralized debt obligations (CDOs), and synthetic CDOs
- Modeling credit risk using the CreditRisk+ model
- Default correlation and credit risk in portfolios
- Managing counterparty risk in derivatives markets
Day 3: Operational Risk and Liquidity Risk
Session 5: Operational Risk Management
- Defining operational risk and understanding its sources: Fraud, system failures, legal risk, and external events
- Quantitative and qualitative methods for assessing operational risk
- Risk control frameworks: COSO, Basel II/III, and the role of internal audits
- Key risk indicators (KRIs) and scenario analysis in operational risk management
Session 6: Liquidity Risk and Funding Strategies
- Understanding liquidity risk and its impact on financial stability
- Measuring and managing liquidity risk: Liquidity coverage ratio (LCR) and net stable funding ratio (NSFR)
- Funding strategies for financial institutions: Asset-liability management (ALM) and liquidity stress testing
- Contingency funding plans and managing liquidity in times of crisis
Day 4: Risk Modeling and Quantitative Analysis
Session 7: Advanced Risk Measurement Techniques
- The importance of Monte Carlo simulation in risk modeling
- Quantitative methods for portfolio optimization and risk management
- Risk-adjusted return measures: Sharpe ratio, Sortino ratio, and Alpha
- The role of copulas and multivariate analysis in risk management
Session 8: Regulatory Frameworks and Risk Governance
- Understanding Basel III and its impact on risk management
- Risk-based capital requirements and stress testing under Basel III
- The role of financial regulators and risk governance structures
- Corporate governance in risk management: Board responsibilities, internal controls, and risk committees
Day 5: Exam Preparation, Review, and Case Studies
Session 9: Comprehensive Review of Key FRM Topics
- Review of market risk, credit risk, operational risk, and liquidity risk
- In-depth analysis of risk management models and strategies
- Exam preparation tips: Time management, question types, and strategic focus areas
Session 10: Case Studies and Practical Applications
- Real-world case studies in financial risk management: Lessons learned from financial crises
- Application of FRM concepts in investment banking, asset management, and corporate finance
- Interactive discussions on risk management challenges in emerging markets
Session 11: FRM Exam Review and Final Q&A
- Detailed breakdown of FRM exam format: Multiple choice questions and case study analysis
- Mock exam and analysis of sample questions
- Final Q&A session with exam strategies and personalized preparation tips