Skip to main content

Exam SRM Study Tips

Exam SRM is a unique exam to study for due to its heavy focus on conceptual learning. This reading provides recommendations to get the most out of your study time.

Plan Ahead​

The SOA and CAS recommend that candidates study for 100 hours for every hour of the exam. Therefore, for Exam SRM, which lasts 3.5 hours, the recommended study time is 350 hours.

This is just a rough estimate. Exam SRM is considered to be an easier exam so 350 hours are likely an overestimate. For comparison, Exam FAM, which is also a 3.5 hour exam, has about twice the amount of material as Exam SRM, but following the 100 hour rule, they would both require 350 hours of study time.

Following the tips in this chapter, you should be able to master the material in far less than 350 hours.

However, given that all actuarial exams are difficult to some degree, it is still recommended to take the exam seriously and put in at least a few hundred hours of study time.

Focus on the Concepts​

Exam SRM is highly conceptual, with previous candidates reporting that 60% to 80% of the exam is qualitative. Students are encouraged to focus most of their time on understanding concepts rather than memorizing the nuances of complicated formulas (this is discussed later).

The Actuarial Nexus places a heavy emphasis on qualitative practice questions, with approximately 75% of the practice questions being qualitative (600+ qualitative and 200+ quantitative). The majority of the qualitative questions are derived from the course material.

Consistent with the SOA sample questions, there are three types of qualitative questions that you will encounter when going through practice questions:

  1. Which of the following statements is NOT true... (only one answer choice is NOT true)
  2. Which of the following statements is true... (only one answer choice is true)
  3. Determine which statements is/are true... (3 statements, I, II, and III, are provided in the question, and you must select the answer choice that correctly identifies all true statements)

Sideline Complex Math​

Of the remaining 20% to 40% quantitative questions, the difficulty is on par with the difficulty of the SOA sample questions, meaning that most of the calculations are designed to be straightforward.

Math will still be needed to solve quantitative questions, but in most cases, these questions do not require you to memorize many of the complex formulas found at the end of Section 2 and Section 3 of the course. Below is a list of formulas that may have a low chance of appearing on the exam:

  • Any formula that uses matrix algebra
  • Leverage and Cook's distance
  • VIF
  • Breusch-Pagan test
  • Weighted least squares
  • Scale equivariance
  • All the equations in the nominal dependent variables chapter
  • All the equations in the ordinal dependent variables chapter
  • All the equations in the Poisson regression chapter
  • All the equations in the other count models chapter
  • The Tweedie distribution
  • One-step prediction error
  • Seasonal adjustments
  • Unit Root Test and Dickey-Fuller
  • ARCH and GARCH
  • The cost-complexity subtree pruning formula (you should still understand the general steps in the algorithm)
  • The bootstrap formula

This list was compiled by reviewing quantitative questions in the SOA sample list. None of the SOA sample questions include any quantitative questions using formulas from the list above. This does not mean they will not appear on the exam with 100% certainty, since they are still technically on the syllabus. However, if you are deciding what to focus on, memorizing these formulas should be near the bottom of the list.

Some of these concepts are quite abstract and include lots of variables, making them more time-consuming to understand. As a result, the potential payoff for mastering these formulas is relatively low.

It is still important to understand the concepts (e.g. what is leverage, what is an ARCH model, etc.), but that should also be less time-consuming than knowing how to perform calculations using these formulas.

To optimize your study time, the practice questions bank minimizes the number of quantitative questions that use formulas from the list above, instead opting to ask variations of equations and calculations that are more likely to appear on the exam.

Read the Source Material​

Exam SRM is one of the few preliminary exams where reading the source material is repeatedly recommended, per online actuarial communities such as the Actuarial Science subreddit and Actuarial Exam Study Group Discord server.

Although this can apply to both Frees and ISLR, many successful candidates recommend just reading ISLR. ISLR is recommended because the exam can ask questions that use language directly from the source material. The course is written in such a way that it does not deviate from the language used in ISLR. The accompanying practice questions also use consistent language with the source reading. For additional learning, reading ISLR is an excellent supplement.

Frees includes a lot of useful information, but it is densely packed with formulas. The text also provides little conceptual explanation around some of the more complex formulas. In creating the course, many of the more complex formulas were supplemented with information from external sources for better understanding. This lack of explanation in the source material may also contribute to the reduced likelihood of these complex formulas being tested.

Use Your Best Judgment​

Since qualitative questions can directly source from verbiage in the source reading, this can result in questions and answers that are aligned with the source material, but potentially subjective in nature, as these questions test an understanding of the source reading rather than the concepts themselves.

Unlike quantitative questions, which typically result in calculations that are either 100% correct or 100% incorrect, qualitative questions may include a level of subjectivity. You will have to use your best judgment to understand what the question is asking for.

Exam SRM is a relatively established exam now. It is unlikely for the SOA to have a "faulty" question tossed out due to subjective interpretation. Knowing what the question is asking for is something you will have to master with practice. This is also a useful skill to develop for written exams, where there may be multiple (subjective) correct answers.

Study Strategies​

Exam SRM consists of five Learning Objectives that are more-or-less independent of each other. Compared to the source material, the course should be a quick read, and as mentioned earlier, some chapters can be reserved for later in your study process.

The course also comes with 800+ accompanying flashcards. The flashcards feature is built with spaced repetition and an accompanying AI chatbot with access to state-of-the-art models if you have any questions. Compared to other preliminary exams, the conceptual nature of Exam SRM is well-suited for this type of learning.

Practice Questions​

Once you are comfortable with the concepts, it is highly recommended to solve practice questions, as this will engage active learning and get you familiar with the types of questions that the exam may ask.

The Actuarial Nexus offers a variety of tools to work through practice questions, which you can read more about here.

Here are some strategies to get started:

  • Use the Linked Syllabus to track your progress by topic. Try to correctly solve all the questions at least once. If this is not possible due to time constraints, try to solve questions from a variety of topics so you get an understanding of topics throughout the syllabus.
  • Go back to problems you missed and analyze your errors to identify areas where you need to improve your understanding. Use Problem Set by Topic or Spaced Repetition to focus on areas of weakness.

Monitoring Progress​

The historic pass rate for Exam SRM is around ~70%, although it has dropped slightly below 70% recently. This means that the top ~70% of candidates pass the exam each sitting. This is still the highest historic pass rate of any preliminary actuarial exam.

You can monitor your relative performance (percentile rank) with Pass Prediction. Pass Prediction assesses your chance to pass based on your percentile relative to users of the platform.

You can also manually monitor your placement in the leaderboard, by level, questions solved, average solve time, and accuracy rate to gauge your chances of passing. The higher you rank in each metric, the greater the chance you have of passing the exam.

The Actuarial Nexus offers a variety of other tools to measure performance, which you can read about here.

Mock Exams​

The final stage in exam preparation is to take mock exams. Mock exams simulate the conditions of the actual exam, giving you an idea of the test's format and the kinds of questions that might come up.

Here's what to keep in mind during this stage:

  • Review each exam thoroughly. Pay attention to the questions you answered incorrectly or took too long to answer, and focus on improving in these areas.
  • Make use of the flag feature and budget time at the end of each exam to make sure you've answered every question. There is no penalty for guessing.
  • Right click an answer choice to strike it out.

Answering the qualitative questions first can be a valid strategy, as they are usually "know-it-or-don't" questions:

  • This will leave plenty of time for quantitative questions so you can better budget your remaining time since there will be fewer questions to consider.
  • This approach also helps minimize the mental shift (context switching) required when transitioning between qualitative and quantitative questions.