My biggest fear in PM is ethics… could you guys comment my answers? Duty to all beneficiary wife treat as regular (IPO) Correction method is OK, but give back %% not %% from debtor - not correct CFA both incorrect because not used ® sign (not sure about it 
we should not fire but reduce assets (as far as i see - should fire…) we should review quaterly from random employees move trades to broker - is OK when receive non public - keep confidential and dont use and we should suspend guy until evaluation finished forgot other 2… thanks
where the heck can we find answers to correct/wrong trade allocation practices? (whether to credit or debt interest when you allocated shares wrongly) i cant seem to find in the textbook
Duty to all beneficiary - AGREE wife treat as regular (IPO) - DISAGREE (he has a beneficial interest, 100% sure) Correction method is OK, but give back %% not - AGREE (if u mean should not TAKE back) %% from debtor - not correct - CAN’T REMEMBER CFA both incorrect because not used ® sign (not sure about it - DISAGREE (first usage was definitely ok, second I said was not because reference to passing the LEVEL II EXAMINATION seemed odd ; 25% sure!) we should not fire but reduce assets (as far as i see - should fire…) - DISAGREE (fire him, reduce is a cop-out; 80% sure) we should review quaterly from random employees - DISAGREE (ans: not let anyone trade in 5 preceding days; 90% sure) move trades to broker - is OK - AGREE (best execution; 90% sure) when receive non public - keep confidential and dont use - DISAGREE (the idea that you could have access to material non-public and just not use it, is ridiculout; 90% sure) and we should suspend guy until evaluation finished - CAN’T REMEMBER.
Etienne, would you make the non-public information public then? I answered so, it seemd the most ethical…
Mr D - I was thinking from a practitioner’s stand-point. I thought: you can’t really disseminate that kind of info. Hence, I think I said you should terminate the relationship.
only 1/3 of these questions show up the Asia version
if I allocate you some stock by mistake, and I must cancel it two days after, i should not do it at market value… imagine I made you lose 20%… i think the market value is the trick here
i think CFAI is anti-asia
terminate relationship i think also,all that stuff about give back the interest for misallocation seemed odd - it would lead to a lot of manipulation right? i thought everything that guy did was wrong
flyingkolours Wrote: ------------------------------------------------------- > terminate relationship i think > > also,all that stuff about give back the interest > for misallocation seemed odd - it would lead to a > lot of manipulation right? i thought everything > that guy did was wrong was it the option? i chose not to act on information
hala_madrid Wrote: ------------------------------------------------------- > if I allocate you some stock by mistake, and I > must cancel it two days after, i should not do it > at market value… imagine I made you lose 20%… > i think the market value is the trick here I think I missed this detail. too focused on the interest issue. I think I need to leave this board for a while before I drive myself crazy. I have brought my max score down a few points already.
Etienne Wrote: ------------------------------------------------------- > hala_madrid Wrote: > -------------------------------------------------- > ----- > > if I allocate you some stock by mistake, and I > > must cancel it two days after, i should not do > it > > at market value… imagine I made you lose > 20%… > > i think the market value is the trick here > > > I think I missed this detail. too focused on the > interest issue. I think I need to leave this > board for a while before I drive myself crazy. I > have brought my max score down a few points > already. relax, the same happened last year try to focus on Romania, Italy and Netherlands
hala_madrid Wrote: ------------------------------------------------------- > Etienne Wrote: > -------------------------------------------------- > ----- > > hala_madrid Wrote: > > > -------------------------------------------------- > > > ----- > > > if I allocate you some stock by mistake, and > I > > > must cancel it two days after, i should not > do > > it > > > at market value… imagine I made you lose > > 20%… > > > i think the market value is the trick here > > > > > > I think I missed this detail. too focused on > the > > interest issue. I think I need to leave this > > board for a while before I drive myself crazy. > I > > have brought my max score down a few points > > already. > > > relax, the same happened last year > > try to focus on Romania, Italy and Netherlands GERMANY!!!
On the non-public material one, I answered just keep it a secret. Just thinking of my day job - if a firm told me something that was non-public I wouldn’t be expected to terminate the relationship. I think the handbook says to “try to convince the company to disclose it”, which is way less severe than termination. Doing nothing isn’t perfect, but the best answer in my opinion. I chose quarterly review for the other Q. The only real alternative was the 5 day trade thing, but again, thinking of work, I don’t see how they would possibly enforce this (short of barring you from trading anything in the same equity universe as what you cover/work in). Five days is a long time and what happens if someone makes a trade (without knowledge) then something happens and the fund needs to trade? The guy did nothing wrong, even though I understand the rule would hypothetically prevent front running. I have never heard of any firm implementing a 5 day rule but who knows… In general I think Ethics was pretty difficult. There was a good 4-5 that I had to think hard on, which works out to a pretty big chunk of the questions.
Non-public - I think definitely terminate. If it was a one time thing, with just your firm, maybe not. But it said it was something they did from time to time, and with other clients as well. It there was an option to consult compliance I would have gone for it, but without that, I think you had to dissociate yourself from the situation. On another note - this language killed me “… has passed Level 2 OF THE CFA examination.” I flip-flopped on this one a few times & don’t even remember what I ended up answering. Is this OK? The “of the” part threw me off; seems to indicate that it’s one big examination.
Interesting “has passed level 2 of the CFA examination”… hadn’t thought of that. But CFA is still an adjective, modifying examination, which is the prepositional object. So I think it’s still good. I think it’s acceptable to consider the CFA examination as one big examination that has different levels.
Posted by: Aerius (IP Logged) [hide posts from this user] Date: June 9, 2008 02:52PM “try to convince the company to disclose it” I had this in my ethics notes as well so after a ton of debating and complaining the answer was not there i chose disclose to public even though it should be encourage them to disclose it.
bchadwick Wrote: ------------------------------------------------------- > Interesting “has passed level 2 of the CFA > examination”… hadn’t thought of that. > > But CFA is still an adjective, modifying > examination, which is the prepositional object. > So I think it’s still good. I think it’s > acceptable to consider the CFA examination as one > big examination that has different levels. I think both the statements were fine, the only hitch is if they are requred to put the ® behind CFA in both statements, if yes, then both are wrong.
They better not grade that ethics question incorrect because it didn’t have the trademark symbol after CFA. That would be pretty low if they did.
Three’s a charm Wrote: ------------------------------------------------------- > Posted by: Aerius (IP Logged) > Date: June 9, 2008 02:52PM > > “try to convince the company to disclose it” > > I had this in my ethics notes as well so after a > ton of debating and complaining the answer was not > there i chose disclose to public even though it > should be encourage them to disclose it. but this was their private calculations. doesn’t it assume that to encourage them to disclose it that the info is information that should be public?