Ethics (15%)

Question 1

GIPS Section 0

Answer 1

Fundamentals of Compliance

Question 2

Fundamentals of Compliance

Answer 2

GIPS Section 0

Question 3

GIPS Section 1

Answer 3

Input Data

Question 4

Input Data

Answer 4

GIPS Section 1

Question 5

GIPS Section 2

Answer 5

Calculation Methodology

Question 6

Calculation Methodology

Answer 6

GIPS Section 2

Question 7

GIPS Section 3

Answer 7

Composite Construction

Question 8

Composite Construction

Answer 8

GIPS Section 3

Question 9

GIPS Section 4

Answer 9

Disclosure

Question 10

Disclosure

Answer 10

GIPS Section 4

Question 11

GIPS Section 5

Answer 11

Presentation and Reporting

Question 12

Presentation and reporting

Answer 12

GIPS Section 5

Question 13

GIPS Section 6

Answer 13

Real Estate

Question 14

Real Estate

Answer 14

GIPS Section 6

Question 15

GIPS Section 7

Answer 15

Private Equity

Question 16

Private Equity

Answer 16

GIPS Section 7

Question 17

GIPS Section 8

Answer 17

Wrap Fee / SMA Portfolios

Question 18

Wrap Fee / SMA Portfolios

Answer 18

GIPS Section 8

Question 19

Standard of Professional Conduct I

Answer 19

Professionalism

A. Knowledge of the Law

B. Independence and Objectivity

C. Misrepresentation

D. Misconduct

• You do not need to disclose bankruptcy if it did not involve frad or deceitful business.

Question 20

Standard of Professional Conduct II

Answer 20

Integrity of Capital Markets

A. Material Non-Public Information

• if you have insider info, but you don’t act on it as a result it’s also a violation. In this case you urge company to make public.

B. Market Manipulation

Question 21

Standard of Professional Conduct III

Answer 21

Duties to Clients

A. Loyaly, Prudence and Care

B. Fair Dealing

C. Suitability

• if client wants to do trade you think sucks, you needs affirmation from them that it’s ok.

D. Performance Presentation

E. Preservation of Confidentiality

Question 22

Standard of Professional Conduct IV

Answer 22

Duties to Employers

A. Loyalty

B. Additional Compensation Arrangements

C. Responsibilites of Supervisors

Question 23

Standard of Professional Conduct V

Answer 23

Investment Analysis, Recommendations and Actions

A. Diligence and Reasonable Basis

B. Communication with Clients and Perspective Clients

• if you change investment strategy you need to let clients know immedietely, not neccessarily in writing.

C. Record Retention

• RECOMMEND maintaining records for at least 7 years. records of recommendations and communications. (not requirement).

Question 24

Standard of Professional Conduct VI

Answer 24

Conflicts of Interest

A. Disclosure of Conflicts

• must disclose to clients if you get other compensation. must tell your clients about situations that could impair ability.
• Note: disclosure of other compensation agreements is only for employers.

B. Priority of Transactions

C. Referral Fees

Question 25

Standard of Professional Conduct VII

Answer 25

Responsibilities as a CFA Institute Member or Candidate

A. Conduct as Members and Candidates in the CFA Program

B. Reference to CFA Institute, The CFA Designation and the CFA Program

• you are allowed to reference factual info. You cannot exaggerate meaning though ie. “elite group of members who have passed cfa.”

Question 26

how many years does GIPS require you to show for investment performance?

How many years does V(c) RECOMMEND you to keep?

Answer 26

• min of 5 years or since inception if existence less than 5 years.
• 7 years

Question 27

referring to the CFA

Answer 27

cannot overstate competency or imply that you can achieve superior results.