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Which of the following is NOT part of the CFA Institute Code of Ethics. Members of CFA Institute will:

A) use reasonable care and exercise independent professional judgment.

B) strive to maintain and improve their competence and the competence of others in the profession.

C) practice and encourage others to practice in a professional and ethical manner that will reflect credit on members and their profession.

D) recommend investments that maximize returns for a given level of risk.

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Answer and Explanation

Standard of Professional Conduct III(C), not the Code of Ethics, requires that investments be appropriate and suitable.

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John Elliot, CFA, says that in issues of ethics he always puts the clients first according to the guidelines in the Code of Ethics. In doing so he is:

A) not correct because no such ordering or priority is given in the Code.

B) not correct because his first duty is to the public.

C) not correct because his first duty is to his employer as long as the employer is enforcing the Standards.

D) correct.

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The Code of Ethics does NOT explicitly say that a CFA Institute member shall do which of the following?

A) Act with integrity.

B) Reflect credit on the profession.

C) Actively lobby for new laws to protect the public.

D) Exercise independent professional judgment.

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The first component of the Code of Ethics does NOT explicitly say that a CFA Institute member will act in a certain manner with respect to which of the following groups?

A) The public.

B) The SEC.

C) The member's employer.

D) Colleagues in the investment profession.

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Which of the following is least likely a component of the Code of Ethics? In dealing with the public, clients, prospects, employers, employees, and fellow members, CFA Institute members shall act with:

A) humility.

B) respect.

C) integrity.

D) competence.

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According to the Code of Ethics, when practicing in a professional and ethical manner the goal is to:

A) increase membership in CFA Institute.

B) resolve conflicts between clients and employers.

C) reflect credit on members and the profession.

D) resolve conflicts between fellow employees and the employer.

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According to the Code of Ethics, the professional judgment of a member should be:

A) dependent on that of his/her colleagues.

B) quick and timely.

C) independent.

D) guided by the SEC guidelines.

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Which of the following activities would be following a component of the Code of Ethics explicitly?

A) Maintaining a list of colleagues who have violated the CFA Institute standards.

B) Acting as a character witness for a colleague.

C) Consulting with colleagues about opinions you reach in your research.

D) Attending continuing education seminars on investing and inviting colleagues to come along.

cfaedu

The Code of Ethics does NOT explicitly say that a CFA Institute member shall do which of the following?

A) Act with integrity.

B) Actively lobby for new laws to protect the public.

C) Reflect credit on the profession.

D) Exercise independent professional judgment.

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Which of the following is a component of the Code of Ethics?

A) Members shall not knowingly participate or assist in any violation of such laws, rules, or regulations.

B) Candidates in the CFA Program, as defined in the CFA Institute Bylaws, may reference their participation in the CFA Program, but the reference must clearly state that an individual is a candidate in the CFA Program and cannot imply that the candidate has achieved any type of partial designation.

C) Members shall not engage in any professional conduct involving dishonesty, fraud, deceit, or misrepresentation or commit any act that reflects adversely on their honesty, trustworthiness, or professional competence.

D) Members shall use reasonable care and exercise independent professional judgment.