《CFA三级培训项目:经典题_Ethical and Professional Standards_打印版.docx》由会员分享,可在线阅读,更多相关《CFA三级培训项目:经典题_Ethical and Professional Standards_打印版.docx(79页珍藏版)》请在三一办公上搜索。
1、EthicalandProfessionalStandardss(O*5dmHS69f5CgApplicationoftheCodeandStandards:LevelIIIMW&hmiBQCase:JasonLockeJasonLocke,CFA,hasrecentlybeenhiredastheChiefInvestmentOfficeroftheEscarpmentRegionalGovernmentEmployees*PensionFund(theFund).Currently,heisconductingevaluationsofallexternalmanagersemployed
2、bytheFundtoensurethattheyareprovidingthehighestpossiblereturnsfortheirmandates,whilecomplyingwithallapplicablelawsandregulations.1.ockeisevaluatingtheactivityofNiagaraGrowthManagers(NGM)falocalmoneymanagerallocated10percentoftheFund,sassets.Herealizesthatanyreductionintheallocationtothislocalmanager
3、willbemetwithconsiderablepoliticalpressure.Theinvestmentpolicystatement(IPS)forNGM,sportionoftheFund,sassetsstatesthatNGMistoactivelymanageanequityportfoliooflocalSmall-cap,high-techcompanies.UponhisreviewofNGM*sactivity,Lockeisconcernedabouttwoitemsthathewouldlikeexplained.AtameetingwithNGMMportfol
4、iomanager,EmmaBlack,CFA,Lockeaskshertocommentoneachitem:CommoditiesPositions1.ocke:,0verthelastyear,severallargepositionsincommoditieshavebeentakenbytheFundsportfolio.ThisisinconsistentwiththeIPS.wBlack:Commoditieshavesignificantlyoutperformedhigh-techequitiesrecently.Iaddedcommoditiestolargerclient
5、s,portfoliosonatemporarybasis.Clientswerenotinformedbecausethepositionswillbesoldoncemarketsentimentshifts.Ihavenotmanagedcommoditiesbefore,butIamgettinggoodreturns/*1.ocke:Iamuncomfortablewiththeseinvestmentsinthisportfolio/QCase:JasonLockeIPOShareAllocation1.ocke:,TheFundsportfolioreceived50,000sh
6、aresofaninitialpublicoffering(IPO)on1April.On15May,30,000shareswereremovedatthecurrentmarketprice.Black:,TherewasaproblemwithNGMfsIPOallocationalgorithm.Initially,youwereover-allocatedandwhenwediscoveredtheerror,youraccountwasadjusted/1.ocke:Short-terminterestshouldhavebeencreditedtotheFundforuseofi
7、tscashtocoverthetrade.Inanycase,thiswasanIPOofalargeinternationalhigh-techcompany.Itwasnotanappropriateinvestmentfortheportfolio/QCase:JasonLockeAfterthemeeting,LockeisnotsatisfiedwithBlackscommentsanddecidesthatfurtheractionisrequired.HealsodecidesthathewillallowNGMtocontinuetomanageFundassetsuntil
8、hefinisheshisevaluation.ThisdecisionisbasedonthesuperiorreturnsoftheNGM-managedassets,thesignificantdiversificationthisportfolioaddstotheFund,andalsothepoliticalimplicationsoffiringthelocalmoneymanager.Thenextweek,LockecallsBlackandoutlinesseveralconditionsthatmustbefulfilledforNGMtocontinueasamanag
9、erfortheFund.Oneoftheconditionsoutlinedrelatestotradeallocations.TradeAllocation1.ocke:TrovidewrittentradeallocationproceduresconsistentwiththeCFAInstituteStandardsofProfessionalConduct/*Black:Iwillmailyouacopyofournewproceduresstatingthattradeallocationsmustbereviewedattheendofeachmonthagainstclien
10、ts1IPS.Italsosaysthatinterestwillbecreditedtoaccountsthathavebeenincorrectlyallocatedsharesanddebitedfromthoseaccountsthatshouldhavereceivedshares.Withhisevaluationcomplete;LockemustnowconsiderwhethertoretainNGMasoneoftheFund,sassetmanagers.Case:JasonLockeAccordingtotheCFAInstituteStandardsofProfess
11、ionalConduct,LockeoweshisprimarydutyofloyaltyinmanagingtheFundto:A.theplantrustees.Case:JasonLockeQAnswer:B.1.ockesprimarydutyistohisclients.Inthecaseofapensionplan,theclientsarealloftheultimatebeneficiaries.Withrespecttothecommoditiespositions,whichofthefollowingactionsbestdescribesBlacksviolationo
12、ftheCFAInstituteStandardsofProfessionalConduct?BlackviolatedCFAInstituteStandardsby:A.buyinganassetclassinwhichshehasnopriormanagementexperience.B.buyingassetsthatareinconsistentwiththeportfoliosInvestmentPolicyStatement.C.failingtonotifytheclientthatshewouldtemporarilydeviatefromtheclientsInvestmen
13、tPolicyStatement.Case:JasonLockeAnswer:B.UndernocircumstancesshouldamanagertakeinvestmentactionthatisinconsistentwiththeclientsIPS.Case:JasonLockeWithregardtotheIPOshareallocation,arebothNGM,smethodoftradecorrectionon15MayandLockesdemandforashort-terminterestcredit,respectively,consistentwiththeCFAI
14、nstituteStandardsofProfessionalConduct?A.Yes.B.No,onlythemethodoftradecorrectionisconsistent.C.No,onlythedemandforashort-terminterestcreditisconsistent.1.ocke,sinterestclaimislegitimatesincetheFund,scashwasemployedtopurchaseequitiesthatwerelaterremovedfromtheaccount.Therefore,theFundisowedinterestfo
15、rtheperiodinquestion.Case:JasonLockeAfterhisinitialmeetingwithBlack,doesLockesdecisiontoallowNGMtocontinuemanagingtheportfolioviolatetheCFAInstituteStandardsofProfessionalConduct?A.No.B.Yes,becauseheallowedpoliticalfactorstoinfluencehisdecision.C.Yes,becauseheisobligatedtoimmediatelysuspendNGMuntilh
16、efinisheshisevaluation.Case:JasonLockeQAnswer:A.UntilLocke,sinvestigationiscomplete,hehasnoobligationtosuspendthemanagerortakeanyotheraction.Hebelievesthemanagercananddoesaddvaluethroughsuperiorreturnsanddiversification,andthereforeitmaybereasonabletoretainNGMifLockecanbesatisfiedthatthemanagercanac
17、twithintheconstraintsoftheIPSandCFAInstituteStandards.Untiltheanalysisiscomplete,itwouldnotbepractical,andLockewouldbeviolatinghisdutytoactinhisclients1bestinterestsbysuspendingthemanagerandleavingtheassetsunmanagedortotemporarilymovingthemtoanothermanagerforsafe-keeping.WithregardtoLocke,scondition
18、regardingtradeallocation,doesBlack,sresponseviolatetheCFAInstituteStandardsofProfessionalConductwithrespecttoallocationreviewsandinterestadjustments,respectively?A.Yes.B.No,itviolatesthestandardsonlywithrespecttoallocationreviews.C.No,itviolatesthestandardsonlywithrespecttointerestadjustments.QCase:
19、JasonLockeAnswer:A.Clientsuitabilityforaninvestmentmustbereviewedpriortoallocation,notafterward.Withrespecttointerestadjustments,clientswhowereincorrectlyallocatedsharesmustbepaidfortheuseoftheircash;however,innoinstanceshouldclientssufferalossbecauseofanallocationerrorbythemanager(thatis,haveintere
20、stremovedfromtheirportfolioeventhoughsharesareputintheiraccountonabackdatedbasis).Case:JasonLocke哥Basedonhiscompleteevaluation,whatisLockesbestcourseofactionwithrespecttoNGM,smanagementoftheFundsassets?A.ReduceNGM,sallocationoftheFund,sassetsuntilNGMhasdemonstrateditscompliancewithLocke,sconditions.
21、B.EliminateNGMasamanagersinceLockecannotbesurethatNGMwillactfairlyandinaccordancewiththeFund,sIPS.C.MaintainNGM,sallocationoftheFund,sassetsandconcentrateonevaluatingmanagerswithlargerproportionsoftheFund,sassetsorwithsub-standardperformance.1.ockehasadutytothepensionplanbeneficiariestoactintheirbes
22、tinterests.Hewouldbeviolatingthatdutyifhecontinuestoemployamanagerwhodoesnotmanageitsmandateordemonstratethatitisawareofandcomplieswithitsowndutiestoclients.Hemustdemonstratehisownprofessionalcompetencebyfiringthemanager.Case:EliasNanoEliasNano,arecentMBAgraduateandaCFALevelIlcandidate,isanunpaidsum
23、merinternwithPatriarchInvestmentCounselandexpectstobeofferedafull-timepaidpositioninthefall.Throughhisefforts,heisabletoconvincesomefamilymembersandfriendstobecomeclientsofthefirm,andhenowassistswiththemanagementoftheiraccounts.Hissupervisorcongratulateshimandstates:Theseclientsarethefoundationfromw
24、hichyouwillbeabletobuildyourcareerasaninvestmentadvisor.wAfterworkinghardallsummer,NanoistoldthatPatriarchwillnotbeabletoofferhimapaidposition.QCase:EliasNanoNanointerviewswithanumberoffirms,andtellseachoneabouttheaccountsthatheismanagingandexpectstobeabletobringwithhim.BecausehewasmerelyaninternatP
25、atriarch,hedoesnotthinkheowesanyparticularloyaltytoPatriarch.HegainsfurtherassurancethathecankeeptheclientsfromthefactthathisformersupervisorimpliedthatthesewereNanozsclients.NanosubsequentlyjoinsMarkoeAdvisorsasanassistantdirectorwithsupervisory management solutions for Markoe doesresponsibilities.
26、MarkoeAdvisorsisaninvestmentfirmthatadvertisesthatitprovidescustomizedportfolioindividualandinstitutionalclients.Asamatterofpolicy,notrejectasaclientanyindividualmeetingtheaccountminimumsize.Markoehastwostrategiesaggressivegrowthequityandgrowthequityandisalwaysfullyinvested.Nanoaskshisfamilyandfrien
27、dstotransfertheiraccountsfromPatriarchtoMarkoe.AsthefirstCFAcandidatetobeemployedbyMarkoe,Nanohasbeenaskedtoheadateamthatisreviewingthefirm,scompliancepoliciesandprocedures,whichNanoconsidersinadequateandincomplete.HestateshisconcernstoPresidentMarkoe:AlthoughMarkoeAdvisors,asafirm,cannotadopttheCFA
28、InstituteCodeofEthicsandStandardsofProfessionalConduct,thefirmcanadopttheCFAInstituteAssetManagerCodeofProfessionalConduct.PresidentMarkoetellsNanothatthefirmisconsideringacquiringanotheradvisoryfirmthathassimilarcompliancepoliciesandprocedures.Markoesays:Wearenotgoingtoconsideranycompliancechangesa
29、tthistime.QCase:EliasNanoNanodecidestodraftamodelcompliancedocumenttoguidediscussionsaboutcomplianceissuesatthefirminthefuture.Nano,sinitialdraftincludesthefollowingcomponentsofacompliancepolicystatement:PerformancePresentationPerformancedatamustbedocumentedforeachofMarkoeAdvisors*activeaccounts,bed
30、iscloseduponrequestandbecomparedwiththefirm,scomposite,whichiscomposedofactiveaccountsonly.Performancedatamustbepresentedonabefore-taxbasistoallclients,withthedisclosurethatallperformancedataarepresentedgrossoffees.SuitabilityofInvestmentsMarkoeAdvisorsftomaintainconsistencyofperformance,assignseach
31、clienttooneofthefirm,stwoportfolios.Bothoftheseportfoliosaresufficientlybroadlydiversifiedtomeettheinvestmentobjectivesofallofourclients.Case:EliasNanoQMarkoeAdvisorsencouragesitsstafftobeinvolvedinthebusinessandciviccommunity.Onlybusinessorcivicintereststhatrelatetocurrentportfolioholdingsneedtober
32、eportedtothefirm.ViolationsAnyviolationoftheMarkoeAdvisorscompliancepolicystatementwillbereportedtothepresident,andemployeeswillreceiveanofficialwarning.CompensationAllstaffmembersofMarkoeAdvisorswilldiscusswiththeirsupervisoralloutsidecompensationthattheyarereceivingormayreceive.DoesNanocomplywitht
33、heCFAInstituteStandardsofProfessionalConductwhenheaskshisclientstotransfertheiraccountstoMarkoeAdvisors?A.No.B.Yes,becausehecontactedtheclientsafterleavingPatriarch.C.Yes,becausehewasaninternandnotapaidemployeeofPatriarch.Case:EliasNanoAnswer:B.StandardIV(八)prohibitsemployeesfromsolicitingtheclients
34、ofemployerspriorto,butnotsubsequentto,theirdeparture.Case:EliasNanoIsNano,sstatementwithrespecttoadoptionoftheCFAInstituteCodeofEthicsandStandardsofProfessionalConductandtheCFAInstituteAssetManagerCodeofProfessionalConduct,respectively,correct?StandardsProfessionalConductNoYesNoTheCFACodeandStandard
35、sapplytoindividualmembersandcandidatesofCFAInstitute,butfirmsareencouragedtoadopttheCodeandStandardsaspartoftheirfirmcodeofethics.TheCFAInstituteAssetManagerCodeofProfessionalConducthasbeendraftedspecificallyforfirms.Case:EliasNanoAccordingtotheCFAInstituteCodeandStandards,whatactionshouldNanotakeaf
36、terdiscussingthefirmscompliancepolicywithPresidentMarkoe?Nanoshould:A.resignfromthefirm.Case:EliasNanoAnswer:C.StandardIV(C)statesthatthememberorcandidateshoulddeclineinwritingtoacceptsupervisoryresponsibilityuntilthefirmadoptsreasonableprocedurestoallowhimtoadequatelyexercisesuchresponsibility.Does
37、NanosdraftcompliancepolicystatementconformtotheCFAInstituteCodeandStandardswithrespecttoperformancepresentation?A.No,becauseterminatedaccountsareexcluded.B.No,becauseperformanceisreportedtoallclientsgrossoffees.C.No,becauseperformancedataarepresentedonabefore-taxbasis.Case:EliasNanoAnswer:A.Standard
38、III(D)statesthatbothterminatedandactiveaccountsmustbeincludedaspartoftheperformancehistory.Case:EliasNanoDoesNano,sdraftcompliancepolicystatementconformtotheCFAInstituteCodeandStandardswithrespectto:SUitabilityOfinvestments?NoNoYesByplacingallclientsinoneofthetwospecializedportfoliositoperates,Marko
39、eAdvisorsisnotgivingadequateconsiderationtotheindividualneeds,circumstances,andobjectivesofeachclientasrequiredbytheStandards.Inaddition,theStandardsrequirethatmembersandcandidatesdiscloseallactualandpotentialconflictsofinterest,notjustthosethatrelatetocurrentportfolioholdings.Case:EliasNanoDoesNano
40、*sdraftcompliancepolicystatementconformtotheCFAInstituteCodeandStandardswithrespectto:Case:EliasNanoQAnswer:A.TheStandardsrequirethatthesupervisorpromptlyinitiateaninvestigationtoascertaintheextentoftheviolationandshouldtakestepstoensurethatviolationswillnotberepeatedbylimitingormonitoringtheemploye
41、es,activities.TheStandardsalsorequirethatmembersandcandidatesobtainwrittenpermissionfromtheiremployerbeforeacceptinganycompensationorbenefitsfromthirdpartiesthatmaycreateaconflictofinterest.PatriciaJollie,CFA,isthefixed-incomeanalystandportfoliomanageratMahsudFinancialCorporation,asmallinvestmentfir
42、m.On5April,afriendwhoworksforabond-ratingagencymentionstoJolliethatabondtheagencyisanalyzingwillexperiencearatingchange.ThatbondalsohappenstobeinMahsudFinanciaTsportfolios.Notwantingtotradeaheadoftheratingchangeannouncement,Jolliedecidestowaitfordistributionoftheinformationthroughherfriend,sschedule
43、dinterviewonabusinesstelevisionprogramtheafternoonof8April.Onthemorningof8April,theinformationisreleasedonaworldwidefinancialnewsservice.JollieimmediatelychangeshermindaboutwaitingfortheinterviewandtradesthebondsinMahsudFinanciaTsportfolios.QCase:PatriciaJollieOn8AprilfJolliealsotradesasecondbondtor
44、ebalanceoneofMahsudFinanciaTsportfolios.Jollieknowsbeforeexecutinghertransactionthatthebondisthinlytraded.AlthoughJollie,stradewillmateriallyaffectthebond,smarketprice,itisnotherintentiontocreatepricemovement.Acolleaguewitnessesthetradeandlargebondpricechangeandsays,Whatamarketoverreaction;thebondpr
45、iceappearstobedistortedow!mThecolleaguealsopointsouttoJolliethatMahsudFinanciaspolicyonmarketmanipulationstates:wMahsudFinancialemployeesmustrefrainfrommakingtransactionsthatdistortsecuritypricesorvolumewiththeintenttomisleadmarketparticipantsrQCase:PatriciaJollieInconductingfixed-incomeresearch,Jol
46、liebelievesthatinsightintoprospectivecorporatebondreturnscanbederivedfrominformationthatisalsorelevanttoacompany,sstock.ShespendsseveralhoursaweekinequityinvestmentchatroomsontheinternetandshepaysparticularattentiontotheresearchreportspostedbyJillDean,CFAfaself-employedanalyst,onWwWJilLDean_the_lnde
47、pendent_A.Priortowritingeachreport,Deanispaidaflatfeebythecompanieswhosestockssheresearches,butshedoesnotrevealthisfacttoreadersofherreports.Sheproducesreportsonlyforthosecompanieswhosestocksshecanlegitimatelygivebuyrecommendationsafterconductingathoroughanalysis.Otherwise,shereturnstheflatfee.Inves
48、torshavecometorecognizeallherHbuyMratingsashavingasoundandreasonablebasis.JollieconsidersDeanssummariesandforecaststobeverywell-crafted.DeanhasgivenJolliewrittenpermissiontousehersummariesandforecasts,wordforwordandwithoutattribution,inherownbondanalysisreports.Onoccasion,Jolliehasdoneso.InDeansotherinternetpostings,shereportstheresultsofrelevantacademicfinancestudies.OnceJollielearnsofastudybyreadingDean,spostings,sheoftenreadstheoriginalstudyandmentionstheresultsinherownreports.Jolliealwayscitestheor