Ethics Exam [Q & A]

What should professionals always prioritize according to the Code of Ethics?

Client interests over personal gain.

What action is considered a violation of acting with integrity?

Lying about investment experience.

What does it mean to act with competence in financial services?

Work within your abilities and commit to learning.

What is a violation of promoting ethical behavior?

Ignoring insider trading by a colleague.

What does the Code of Ethics say about following laws and rules?

Comply with laws, regulations, and CFA standards.

What is considered a violation when it comes to protecting the profession?

Posting offensive opinions under CFA title.

What is the expected knowledge regarding the law in professionalism?

Understand and follow laws and ethical codes.

What violation occurs when a professional accepts gifts from clients?

Accepting concert tickets from a client.

What is the violation related to misrepresentation?

Exaggerating past performance.

What is a type of misconduct according to the Standards of Professional Conduct?

Getting caught in a fraud case.

What is prohibited in relation to material nonpublic information?

Don’t trade on or share insider information.

What does market manipulation involve?

Actions that distort market prices or information.

What principle regarding duties to clients involves acting in their best interest?

Loyalty, Prudence, and Care.

What is a violation of fair dealing?

Giving new info to favored clients only.

What does suitability refer to in financial advice?

Matching investment recommendations to client goals.

What is the violation related to performance presentation?

Cherry-picking to show only good results.

What does the duty of confidentiality imply?

Protect all client data unless legally required.

What does loyalty to employers mean in the context of the Standards of Professional Conduct?

Don’t harm or compete against your employer unfairly.

What violation occurs when failing to disclose additional compensation?

Earning consulting fees in secret.

What is expected of supervisory responsibility?

Ensure those you oversee follow standards.

According to investment analysis and actions, what should investment decisions be based on?

Solid research.

What should client communication include?

Explain investment processes, risks, and updates.