Ethics

CFA Level II
#1

…if company charges higher than average fees but provides some unique informational services to investors… a violation of the standards, yes or no?

#2

very vague, need more info… but I am leaning towards No…

#3

Not a violation, if the price is justified with tht add on service

#4

agree that add’l info would help…but in general, i don’t recall anything in ethics on guidance as to what fees are reasonable/unreasonable. is this question in a soft dollar context? if so, that might change the nature of what you are asking… otherwise, no violation IMO.

#5

I don’t think CFAI defines “reasonable fees” so as long as it’s “reasonable” its fair and not a violation.

#6

if they provide more than average services i don’t see why it would be

#7

Not a violation. Reasons: capitalism, downward sloping demand, rent seeking…

#8

true, not a violoation

#9

You can charge whatever you want for services, now if your an agent seeking services for a principle, then you get into ethics, but as long as you disclose the arrangement and added value is comiserate with price, you should be fine.

#10

I saw this question today. It IS a violation, because there is no idication that these “unique information services” compensate for the fact they you don’t get best price and execution. If you are directing client brokerage to this firm, and the clients are not seeing full benefit from this, then it IS a violation.

#11

I believe my explanation still fits, my first point was regarding the fact that the dude never explained to us that we were agents in this transaction.

#12

I agree, and would have said the same thing as you had I not seen the additional information today and gotten burned on it myself.