CFA CFA Level 1 Question of the Week – Ethics Standards of Professional Conduct

Question of the Week – Ethics Standards of Professional Conduct

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    • Avatar of exam_whizexam_whiz
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        The correct answer is B.

        According to standard III (B), members must deal fairly with all clients. By giving preferential treatment to his friend, Ronald violates the standard by being unfair to other clients.

        The ‘buy’ recommendation is given by his company’s research team. Further, he himself reads the entire research thoroughly and is convinced that the stock is worth buying. Thus, he has a reasonable basis to buy the stock. Standard V (A) is not violated.

      • Avatar of shannondailyshannondaily
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          Woo! I got it right. 🙂 

        • Avatar of azaratanazaratan
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            Does “thoroughly reading the detailed report” constitute to a reasonable basis and due diligence? I answered “C” because I thought Pitt should have done more than just “thorough reading”. What do you guys think?

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            @exam_whiz‌ what’s the right answer here?
            is the answer B because his friend is a high net worth individual? other accounts will end up buying the stock at an increased price?

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