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Study Session 1: Ethical and Professional Standards

Level II Topics by CFAI Study Session

One of my favorite features of the new site is the ability to “tag” topics using one of the CFAI study sessions. For example, if you post a topic on ethics you can select Study Session 1: Ethical and Professional Standards so that your topic will show up in the filter for that study session. This will allow you and other members of AF to quickly access posts for a specific study session. To tag a new topic with a study session, simply choose that study session from the Filed Under categories above the Save button on the new forum topic page.

Last minute ethics

Schweser had a question about an investment firm that guaranteed a return on a riskless arbitrage trade, which the vignette stated was only possible by them since the firm is the largest in the world and has the lowest transaction costs.

Conflict of Interest

Receiving any benefits that may give the impression of conflict of interest (silting on the board of another company, chairman of a charity,…etc)

Member should disclose ot client

Should also disclose to employer but has to take a written consent?

When does the member have to disclose to employer but  without a written approval

Ethics - performance presentation

Hey guys,

I was reading a practice vignette and couldn’t find an answer as to how often a manager should update performance records on website. The item set seemed to imply not updating after 6 months of underperforming wasn’t frequent enough. I assume quarterly would be adequate?

Ethics - Research Objectivity

If a company is performing an activity which is contrary to the Research Objectivity standard recommendations. Would it be considered a violation?
There are some aspects in the recommendation section which conform with the requirements, and would be difficult to distinguish the two apart.

Ethics question

Catherine Czcibor, CFA, works as a portfolio manager for a local investment counseling firm. She is also a member of her son‟s school committee to help raise funding for a program for gifted children in music. Czcibor discusses an arrangement with her supervisor in which she will donate a certain percentage of her fees from clients referred to her by the school staff and parents. She gets a written approval from her firm.

Beneficial Ownership-going crazy

I’m totally lost in the beneficial ownership section, I will summarize what I have understood and would love to have your feedback, I have also included the standard below for whomever want to read it:

1. These accounts should be executed after clients, in case of having:

Conflict of Interest

When an analyst follwing company A, and his wife is working or a board memeber for Co.A. The analyst want to purchase a stock for himself in that company. Is it acceptable if he disclosed the matter?

Ethics-Item Sets

In Ethics item sets in CAFI,

In the below question, since Shera has done the recommendation and timed the target price, does not this mean that she has gone throughly through the third party research to come up with the recommendation and target price?

[question removed by moderator]