Just doing some end of chapter questions in Schweser. Concept Checkers for S.S. 2 (Los 6.b.) Question 6. The answer is C. That Steeber is in violation because she did not disclose her outside business activities to her employer. However, her outside business activities were “selling luxury automobiles and real estate”, which have nothing to do with managing a mutual fund. This also contradicts pg. 51, Example 9. Which pretty much state that if outside business activities do not conflict with employer’s business, no permission from employer is required. Anyone else had an issue with this question, or did I miss something? As I understand, the disclosure to employer should only be made if the outside business is directly in competition with the employer’s business, or takes too much time that it takes away from the employer’s business.
I remember that question. The answer does indeed contradict the example they give in the reading.
It could conflict if selling luxury items and real estate, typically a labour intensive process, interferes with her ability to dilligently research and monitor the mutual fund and its holdings.
In example 9, the outside job is a town mayor. Which to me would seem like a pretty labour intensive job.
Wouldn’t you consider real estate an "alternative investment’?
Yes. But she currently manages a mutual fund which includes viatical contracts. It has nothing to do with real estate and it does not say anywhere in the case that it conflicts with her current role. Anyway, I know what the correct answer is. I just thought I missed something, but I doubt it.