CFA一级百题进阶：职业伦理

1.ETHICSANDPROFESSIONALSTANDARDS

Q-1.

Greyrecommendsthepurchaseofamutualfundthatinvestssolelyinlong-termU.S.

Treasurybonds.Hemakesthefollowingstatementstohisclients:

Statement1:"ThepaymentofthebondsisguaranteedbytheU.S.government;

therefore,thedefaultriskofthebondsisvirtuallyzero."

Statement2:"Ifyouinvestinthemutualfund,youwillearna10percentrateofreturn

eachyearforthenextseveralyearsbasedonhistoricalperformanceofthemarket."

DidGrey'sstatementsviolatetheCFAInstituteCodeandStandards?

A.NeitherstatementviolatedtheCodeandStandards.

B.OnlyStatement1violatedtheCodeandStandards.

C.OnlyStatement2violatedtheCodeandStandards.

Solution:C

ThisquestioninvolvesStandardI(C)—Misrepresentation.Statement1isafactualstatementthat

disclosestoclientsandprospectsaccurateinformationaboutthetermsoftheinvestment

instrument.Statement2,whichguaranteesaspecificrateofreturnforamutualfund,isan

opinionstatedasafactand,therefore,violatesStandardI(C).IfStatement2wererephrasedto

includeaqualifyingstatement,suchas"inmyopinion,investorsmayearn...,"itwouldnotbein

violationoftheStandards.

1-10

Q-2.

YaoTsang,CFA,hasalargepercentageofhisnetworthinvestedintheAustralian

miningcompanyOutbackMines,whichhehasheldformanyyears.Tsangisinthe

processofmovingtoanewemployerwherehewillberesponsibleforinitiating

researchonU.S.domesticminingcompanies.Shortlyafterhismove,Tsangisaskedto

completearesearchreportonOutbackMines.InordertomeettheCFAInstitute

StandardsofProfessionalConductconcerninghisstockholding,whichofthefollowing

isthemostappropriateactionforTsangtotake?

A.Disclosehisstockholdingtohisemployerandtoclients.

B.Sellhisstockholdingstoeliminateanypotentialconflictofinterest.

C.Refusetowritethereportandaskhisemployertoassignanotheranalysttocompletethe

analysis.

Solution:A

Eventhoughthebestpracticeistoavoidconflicts,whenconflictscannotbereasonablyavoided,

fulldisclosureshouldbemadeasrequiredbyStandardVI(A).Asthestockinquestionhasbeen

heldformanyyears,itmaynotbepracticaltosellitduetothingsliketaxconsequences.Since

theanalysthasbeenhiredtoinitiatecoverageofminingcompanies,itisunlikelythatanother

analystatthatfirmwouldbeascompetentincompletingaresearchreportonmining

companies.

2-10

Q-3.

DorianSolot,CFA,isresponsibleforateamofresearchanalystsatApacBank,located

inacountrywithstrictlawsprohibitingintellectualpropertytransfers.Solotbelieves

theworkofoneofheranalysts,BlainePaddock,CFA,isnotcompletedascarefullyand

thoroughlyasitshouldbe.SolotcompletelyreviewsallofPaddock’sresearchand

confirmshersuspicions.SolotthenconfrontsPaddockabouthispoorqualityresearch

andtellshimhecanleaveApacvoluntarilyorbefired.Paddockchoosestoleavethe

bank,walkingoutwithhispersonalpapersandresearchnotesthatwerecreatedprior

tohisjoiningApac.Subsequently,Paddockusesthisintellectualpropertytohelp

establishahigh-net-worthinvestmentadvisoryfirm.Whenaprospectiveclientasks

PaddockifheleftApacbecauseofquestionsonthequalityofhiswork,Paddocksaysit

wastostarthisownbusiness.PaddockleastlikelyviolatedtheCFAInstituteStandards

ofProfessionalConductconcerninghis:

A.Research.

B.Intellectualproperty.

C.Prospectiveclientdisclosure.

Solution:B

BiscorrectbecausetheanalysthasnotviolatedStandardrelatedtointellectualproperty

becausethereisnoindicationtheanalystwasignorantof,orhasviolated,anylawrelatedto

intellectualproperty,becausethesedocumentswerecreatedbytheanalystpriortohis

employmentatApac.

3-10

Q-4.

ABCInvestmentManagementacquiresanew,verylargeaccountwithtwo

concentratedpositions.Thefirm'scurrentpolicyistoaddnewaccountsforthe

purposeofperformancecalculationafterthefirstfullmonthofmanagement.Cuppis

responsibleforcalculatingthefirm'sperformancereturns.Beforetheendoftheinitial

month,Cuppnoticedthatoneofthesignificantholdingsofthenewaccountswas

acquiredbyanothercompany,causingthevalueoftheinvestmenttodouble.Because

ofthisholding,Cuppdecidedtoaccountforthenewportfolioasofthedateoftransfer,

therebyallowingABCInvestmenttoreapthepositiveimpactofthatmonth'sportfolio

return.

A.CuppdidnotviolatetheCodeandStandardsbecausetheGIPSstandardsallowcomposites

tobeupdatedonthedateoflargeexternalcashflows.

B.CuppdidnotviolatetheCodeandStandardsbecausecompaniesareallowedtodetermine

whentoincorporatenewaccountsintotheircompositecalculation.

C.CuppviolatedtheCodeandStandardsbecausetheinclusionofthenewaccountproduces

aninaccuratecalculationofthemonthlyresultsaccordingtothefirm'sstatedpolicies.

Solution:C

CuppviolatedStandardIII(D)-PerformancePresentationswhenhedeviatedfromthefirm’s

statedpoliciessolelytocapturethegainfromtheholdingbeingacquired.AnswerAisincorrect

becausethefirmdoesnotclaimGIPScomplianceandtheGIPSstandardsrequireexternalcash

flowstobetreatedinaconsistentmannerwiththefirm’sdocumentedpolicies.AnswerBis

incorrectbecausethefirmdoesnotstatethatitisupdatingitscompositepolicies.Ifsucha

changeweretooccur,allcashflowsforthemonthwouldhavetobereviewedtoensuretheir

consistenttreatmentunderthenewpolicy.

4-10

Q-5.

DavidGunard,CFA,isanequityanalystatCurrySecurities.Hereceivedanassignment

toanalyzeEnterlochCorporation,ofwhichthestockswereheldbyseveralofCurry’s

clients.Gunardcompletedathorough,fundamentalanalysisofEnterloch.Givenhis

analysisandthesharpriseinthecompany’sstockpriceduringthepastyear,Gunard

concludedthatthesharesweresubstantiallyovervalued.Aftertheapprovalofthe

reportbyGunard’ssupervisor,butpriortotherelease,Gunardcalledhisfatherto

suggestthathesellhisEnterlochsharesimmediately.Gunard’sfatherinformedhim

thathehaddisposedofhisholding.AccordingtotheStandardsofPracticeHandbook,

hasGunardviolatedtheCFAInstituteStandardofProfessionalConductrelatingto:

Dutiestoclients?Reasonablebasis?

A.

B.

C.

No

Yes

Yes

Yes

No

Yes

Solution:B

Bycommunicatingthisinformationtohisfatherpriortothereleaseofthereport,Gunardfailed

toputthefirm’sclients’interestsabovehisown.Nothinginthequestionindicatesthathedid

nothaveareasonablebasisforhisrecommendation;heconductedathoroughfundamental

analysisandhisreportwasapproved.ThefactthatGunard’sfatherhaddisposedoftheshares

doesnotnegatethefactthatGunardviolatedadutytothefirm’sclients.

5-10

Q-6.

YipWaiYin,aCFACandidate,isanindependentmutualfundsalesagent.Forevery

front-endloadproductshepromotes,Yipreceivesaportionofthefront-endfeeas

commissionatthetimeofsale.Foreveryback-endloadfundshesells,Yipreceivesa

smallercommissionpaidattheendoftheyear.Yipalwaysinformsherclientssheis

paidacommissionasanagent,butdoesnotprovidedetailsofthecompensation

structure.Whenpitchingherfavoredfront-endloadproductline,shetellsclients20%

ofhercommissionisalwaysinvestedinthesamefundasproofofherconfidenceinthe

fundsherecommends.WhichCFACodeofStandardswithregardtoConflictsof

InterestdoesYipleastlikelyviolate?

A.ReferralFees.

B.DisclosureofConflicts.

C.PriorityofTransactions.

Solution:C

Yip’sinvestmentsdonotadverselyaffecttheinterestoftheclientsandthereforedonotviolate

thePriorityofTransactionsrequirement.ACandidatehavingthesameinvestmentpositionsdoes

notalwayscreateaconflictofinterestandinsomeinstances,havinganalignedinvestment

portfoliocanbebeneficialtotheclient.

6-10

Q-7.

KazuyaKato,CFA,isawidelyfollowedeconomistataglobalinvestmentbank.When

Katoopinesoneconomictrends,marketsreactbymovingstockvaluationsconsiderably.

WhenKatoreceivedinformationofatemporaryoversupplyofrareearthmetals,he

issuedaforecastthatpricetrendsforrareearthmetalswouldbedownsignificantlyon

along-termbasis.KatoalsosecretlysoldhisreporttoawidelyfollowedInternetsite.

Priortoissuingthisforecast,Katoemailedallportfoliomanagersathisbankwitha

copyofhisreportindicatingthathisopinionwouldbereversedshortlysotherewould

betradingopportunities.KatoleastlikelyviolatedwhichofthefollowingCFAInstitute

CodeofEthicsandStandardsofProfessionalConduct?

A.MarketManipulation.

B.PriorityofTransactions.

C.AdditionalCompensationArrangements.

Solution:B

ThePriorityofTransactionsStandardhasnotbeenviolatedasitrelatestoinvestment

transactionsforclientsandemployershavingpriorityoverMember/Candidatetransactions.

Thereisnoindicationinthiscasethattransactionshaveoccurredasaresultofthereportbeing

issuedbytheeconomist.Althoughitisreasonabletoexpecttherewillbetransactions,itisonly

whenthesehappenthataviolationwillhaveoccurred.

7-10

Q-8.

AccordingtotheFundamentalsofCompliancesectionoftheGlobalInvestment

PerformanceStandards,issuesthatafirmmustconsiderwhenclaimingcompliance

includeallofthefollowingexcept:

A.Replicatingperformance.

B.Properlydefiningthefirm.

C.Documentingfirmpoliciesandproceduresusedinestablishingandmaintainingcompliance

withtheStandards.

Solution:A

Replicationofperformanc