Ethics Q

Hi, Can one of your fund clients be your broker as well? Any conflict of interest etc? If she can’t but still demands to be a broker, which CFA rule will be violated? If she can, do we need to disclose the arrangement to other clients of the fund? Regards, Dorian

I think clients can request anyone be their broker. i.e. soft dollars belongs to the client, anyway.

Sorry, I did not make it clear; this is not a managed fund with only one client. It is a pooled fund with many clients. The main concerns is if the other clients are being treated unfairly.

Yes, if that client is selected as a broker, it must be disclosed to other clients, prospective clients and the employer. (as far as I know!) My guess is no rules are violated for asking to be the broker.