CFA CFA Level 1 Golden rules for Ethics

Golden rules for Ethics

  • This topic has 16 replies, 13 voices, and was last updated Apr-17 by Snippy.
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    • hairyfairy
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      Am trying out all these ethics questions and getting really confused as to what is ethical or not. It’s not at all straightforward – was wondering if there are any golden rules of thumb to bear in mind for ethics.

    • Dan
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      I suggest you read the material, and then just move to resolve practice questions and exams, I find that I learn a lot from those and help me understand the subjects better

    • Sarah
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      For level I I watched the Schweser video on the material and then did lots of questions. After the 50th or so question you have an intuition and the repeated questions help you remember the small details. Like you need written permission from your employer to have a personal practice (or anything else that may be in some way related to your day job….). In some questions they trip you up by saying you obtained verbal permission.

    • policedog
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      Hmm… I was hoping an uber decision flowchart was possible for ethics..

    • hairyfairy
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      Hmm… I was hoping an uber decision flowchart was possible for ethics..

      Me too – but it seems like it’s a practice in familiarizing yourself…

    • tacheman
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      Yep just hit those practice exams and you’ll get a feel for it eventually. Meanwhile if you have any progress on that Ethics decision flowchart I wouldn’t mind having a copy :p

    • imdnextbuffet
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      Just be logically fair and then just follow your heart. Their are some questions for which answers are fixed but when you analyze the answers they dont look correct. In that case just gulp the concept for that particular scenario questions.

    • Snippy
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      When i started doing it last year in my first attempt, i thought that the correct answers would be the logically correct ones. But i was so wrong. Continuous practice of questions and knowledge of all the codes and standards will definitely make it easier to pick the correct answer in the exam.

    • AjFinance
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      @hairyfairy do solve those EOC questions in the CFAI text. It helps a lot. You just have to internalize the basic Ethical standards. I agree it takes time, but once you have a feel of whats right and whats wrong, 8/10 times you will get it right.

      The good thing is Ethics gets repeated in the further levels. But the level of questions also increases as expected. Your depth of Ethical knowledge is tested. Not to scare you, but just giving you a heads up so you don’t brush Ethics aside 🙂

      However, for level 1, if you make sure that you grasp the basic idea of the code and standards and also go through the CFAI EOC questions, that should do it for you. Goodluck :-bd

    • MattyJ
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      I found that the key to ethics is

      1) practice, practice practice…like posters said above, the same things start repeating themselves and you will get to the stage where, in L2 anyway, you will be able to guess the questions whilst reading the vignette.

      2) go with your gut…it’s amazing how often the correct answer is the first that pops into your head!

    • Sarah
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      @MattJuniper

      I think that is the golden rule for all the topics!

      Repetition is key, I find it also helps to discuss concepts with a friend/group of friends. It allows you to walk through somebody else’s though process.

      So repetition using different mediums also helps with getting concepts to stick.

    • singhanand98
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      @hairyfairy there are basically four structures of the ethics materials …
      1. Independence and loyalty
      2.Diligence and reasonable basis
      3. Suitability
      4. If anything goes wrong then disclosure( Especially 1)

    • padniaki
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      I tend to be very aware of subtleties, and it suits me very well for the ethics section. I’ll try to do a little write-up when I get home, but for now, if you run into some practice questions that give you problems post them here and I’ll try to explain the intuition and how to spot it the next time around.

    • hairyfairy
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      Thanks @padniaki! I freaking love this forum. If I can help in any way let me know.

    • lulu123
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      @mattjuniper

      I totally agree with the gut comment

      a lot of the ethics material is very very logical and gut-feeling-like

      there are a lot of areas where it just makes sense to be the way it is! so think about it critically and the right answer will probably come up in your mind

      like think what another person, who never read the ethics material, would think

      most of the time it just makes plane sens (just have to read the question carefully because it can be a small sentence in it that makes the difference!)

    • owenf2
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      I agree with the gut feeling comments…but back it up with plenty of practice exam questions. I spent a day two weekends ago going through a load of ethics practice questions. After a while it just sinks in. I spent today going through a bunch of them aswell, and I definitely improved

    • Snippy
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      I agree. Trusting your instincts helps sometimes, and this comes from practice of course. I realised when i was scoring my practice exams that some of the answers were my first guesses and I got them wrong because i wasn’t sure of my instincts.

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