Michelieu tells a prospective client, “I may not have a long-term track record yet, but I’m sure that you’ll be very pleased with my recommendations and service. In the three years that I’ve been in the business, my equity-oriented clients have averaged a total return of more than 26 percent a year.” The statement is true, but Michelieu only has a few clients, and one of his clients took a large position in a penny stock (against Michelieu’s advice) and realized a huge gain. This large return caused the average of all of Michelieu’s clients to exceed 26 percent a year. Without this one investment, the average gain would have been 8 percent a year. Has Michelieu violated the Standards? A. No, because Michelieu is not promising that he can earn a 26 percent return in the future. B. No, because the statement is a true and accurate description of Michelieu’s track record. C. Yes, because the statement misrepresents Michelieu’s track record.
C
Hmm…B or not to B I choose C
should be true accurate and complete it is not complete he omit critical factor so it is misleading
C for the win
C
def C!
C. …non-discretionary.