Career Discussions Ethical or not: using work investment strategies for personal investments

Ethical or not: using work investment strategies for personal investments

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    • chargold
      Participant
        • CFA Level 2
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        10
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        Is this ethical? At a consultancy that has a lot of PE and HF clients. Part of our work and our pitches to them we devise a lot of investment strategies that may end up being developed further by our clients. The work that we do at the initial stage is already quite thorough and could easily be repurposed for personal investments.

        Question is, is it ethical? Is it even legal?

        To be clear, I’m NOT suggesting using any investment recommendations, privileged information nor any research work that we have done for clients. I’m simply thinking of reusing the concepts, which will likely involve rebuilding some models, then inputting my own personal research and parameters.

        Opinions much appreciated. I am of the opinion that it’s ethical so I’m thinking of doing this soon unless I come across a red flag before then.

      • barbtoksv
        Participant
          • CFA Level 1
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          Doesn’t seem like it’s in breach of anything to me. You’re working on your own personal investments and applying what you have learned.

          I’m assuming you are allowed to invest under company policy.

        • Up
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          Go and clear it with your manager. This is not worth losing your job over.

        • svengali
          Participant
            • CFA Level 1
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            Being devils advocate, what if the method itself would allow you to predict what investments some large institutions would eventually make? Would that be insider information or mosaic theory?The insider information being that you know that some large institutions use these methods to guide their investment strategy, that is.

            That’s actually a very good point, that the insider information itself might not be regarding the investments, but the market movers and the methods they use.

            Would that be considered material non-public information? I had a close look at Standard II(A) Material Nonpublic Information but couldn’t really conclude.

          • concernedape
            Participant
              • CFA Level 2
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              I voted for ‘ethical’. I think it’s fine as long as the methodology itself is not proprietary and insider knowledge.

            • Groucho
              Participant
                • CFA Level 1
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                Ethical if that promotes learning and the consequence of such investment doesnt affect or compromise the interest of the employer or interested parties.

              • policedog
                Participant
                  • Undecided
                  Up
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                  Being devils advocate, what if the method itself would allow you to predict what investments some large institutions would eventually make? Would that be insider information or mosaic theory?

                  The insider information being that you know that some large institutions use these methods to guide their investment strategy, that is.

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