Research

Question 1

What is the activity of a brokerage firm ?

Answer 1

Work on the the ‘sell side’.

Analysts work for brokers and portfolio managers.

Question 2

What are a reasearch analyst’s responsabilities ?

Answer 2

• Learn about the firms and publish their results.
• He processes the information to paint a clear image of the firms.
• Needs good judgement, methodology and rigor.

Question 3

What makes a good research analyst ?

Answer 3

• Experience and notoriety
• Good pedagogue
• Has a different point of view then others (to attract interest)

Question 4

What are the CFA Standards for analysts ?

Answer 4

1. Loyalty (act for the benefit of their employer)
2. Record retention (maintain
   appropriate records to support their investment
   analyses, recommendations, actions, and other
   investment-related communications)
3. Loyalty, prudence and care (must act with reasonable care and
   exercise prudent judgment)
4. Fair dealing (must deal fairly and
   objectively with all clients when providing investment
   analysis, making investment recommendations)
5. Diligence and reasonable basis (Exercise diligence, independence, and
   thoroughness in their actions. Have reasonable basis supported by appropriate research for their actions.)
6. Communication with clients and prospects (Disclose to clients and prospective clients the basic
   format and general principles of the investment
   processes they use for their actions. MUST discloses changes that could affect decisions. MUS disclose risks associated.

Question 5

What are the CFA Standards for Disclosure of Conflicts ?

Answer 5

must make full and fair
disclosure of all matters that could reasonably be
expected to impair their independence and objectivity
or interfere with respective duties to their clients,
prospective clients, and employer. Members and
Candidates must ensure that such disclosures are
prominent, are delivered in plain language, and
communicate the relevant information effectively.

Question 6

What are the CFA Standards for Referal Fees ?

Answer 6

must disclose to their
employer, clients, and prospective clients, as
appropriate, any compensation, consideration, or
benefit received from or paid to others for the
recommendation of products or services.