is soft dollars a violation or not? im confused after reading the official cfa institute books. if lets say additional research benefits the client then its not a violation but if its not then it is. have i gotten this correct?
Soft dollars must be used to benefit clients.
If that’s what happens, there’s no violation.
If you use them for anything else, it’s a violation.
As far as I know, they can be only used to buy research reports. They can’t be used to cover operating expenses incurred by a fund manager.
They can be used for anything that directly benefits clients (e.g., a Bloomberg terminal that is used by traders); it doesn’t have to be research reports.
Y’all are welcome.