Can someone please explain the below from reading 4 of ethics?
Deal fairly and objectively with all clients when providing investment information, making investment recommendations, or taking investment action.
This provision is not intended to prevent Managers from engaging in secondary investment opportunities—referred to in some jurisdictions as “side-letter,” “sidecar,” or “tag-along” arrangements—with certain clients as long as such opportunities are fairly allocated among similarly situated clients for whom the opportunity is suitable
Can anyone advise how L3 differs compared to L1 &2 for Ethics. Obviously, there’s the AMC but that’s very similar to the standards anyway. This was boring enough for two levels, and do we really need to be tested again or are they angling for something different? Thanks in advance
lets say you invested in Manager A who uses a proprietary formula for tech stocks. Lets say this formula also accurately finds opportunities in real estate. You can enter into a side-letter with Manager A to buy Real Estate for an extra fee if opportunities arises. Manager A can only do this if they gave everyone the option to do this side-letter as long as it was suitable. If I was a suitable client, but they didn’t let me and only you enter into a side-letter that wouldn’t be fair at all and would be a no-no.