In accordance with Standard III (A) Loyalty, Prudence and Care, which of the following statements is least accurate? Members and Candidates should: A) submit to clients, at least quarterly, itemized statements detailing all of the period’s transactions. B) make investment decisions in the context of the total portfolio. C) utilize client brokerage to the sole benefit of the client. D) vote all proxies on behalf of clients in a responsible manner
A is my guess.
from what I remember there is a small grey area on D. You do not need to vote ALL Proxies. Proxies need to be voted responsibly, is right. But the ALL proxies part I am not sure. A) also seems plausible because you do not need to submit the itemized statements… CP
Normally D would be a dead giveaway to me too, but it says responsible. Thats why I chose A. Edit: Unless anyone else wants to chime in, whats the answer?
I’m thinking D. Use of ALL seems suspicious. Responsible or not don’t have to vote all proxies.
DDDDD- You don’t need to vote ALL proxies. Only vote those that are beneficial to the client.
A) I think.
D.) Per CFAI book 1 page 50, “a cost benefit analysis may show that voting all proxies may not benefit the client, so voting proxies may not be necessary in all instances”
Does responsible not mean that? I assumed (I know everyone says you should NEVER assume) that responsible meant doing a cost benefit analysis.
But it still says vote all proxies… which taken in itself is not required… yes, the mgr has to be “responsible” in deciding whether or not to vote the proxies but does not have to vote them if not in the best interest of the client…>??? Answer??
I see your viewpoint. This is just another question likes ruhi’s FI question earlier. I can see this question going either way easily. I hope the actual exam is less mucked up.
I’m going with C. That standard talks about fiduciary duty and placing the interests of the client above their own. C is the only one that deals with conflicts of interest.
d - you need not vote on all proxies
D’oh. Least accurate.
A… or D??? Cfaboston… we’re waiting!
A
Has to be A for this. D went down because of the word ‘responsible’
Voting D
what about the part of the soft dollar readings that says something like “it is permissible to use client brokerage from agency trades on research that does not directly benefit the client, as long as you have permission from the client and over time it benefits the client” but i could see it being D as well
Its D…I looked it up.