cfa10yrplan

Be prepared, you’re not going to see straight forward scenerio’s on the exam they will be confusing and you’ll be expected to pick up on key words - my strategy for the exam (particularly ethics) is to try to eliminate wrong answers as opposed to choosing the correct one. Keep in mind a lot of thought and resources have been put into the questions and the incorrect options are well designed to make you think they are correct.
Q5: there is a clear violation here, as an analyst reccomending a company you have a duty of loyalty to ensure that you are permitted to purchase a stock your company is considering. Sanjay mentioned he owned the stock but not that he purchased it after an analysis he conducted for his company. At a minimum he should have gotten clearence to purchase a stock he reccommended.
The priority of transactions was violated because she suggested the company as a suitable target but did not give them an opportunity to act on it before purchasing the shares. Keep in mind priority is clients, firm, you.
Q8: Having ethical constraints do not automatically conflict with the benficiaries interests it simply reduces the breadth of the investment universe. All funds have constraints; how is this one different from saying that you can only invest in domestic securities or may not purchase speculative instruments? Limiting the investment scope vs. acting contrary to the beneficiaries interests’ are two seperate things, there is no evidence of the latter.
Q18: It’s all about putting clients ahead of yourself. If you place a trade for yourself before your clients who would also like to purchase the security you have violated the ethical standards, this is about as clear as you can expect it to be on the exam.
Key for tomorrow is to pick up on key words the questions are designed to make sure you know the material well.
If the questions were easy the CFA designation would hold little value and you may not have considered doing it…