Standard III(C)

Question 1

what is standard III(C)

Answer 1

duties to clients - suitability

Question 2

explain standard III(C)

Answer 2

When Members and Candidates are in an advisory relationship with a client, they must

Make a reasonable inquiry into a client’s or prospective client’s investment experience, risk and return objectives, and financial constraints prior to making any investment recommendation or taking investment action and must reassess and update this information regularly.

Determine that an investment is suitable to the client’s financial situation and consistent with the client’s written objectives, mandates, and constraints before making an investment recommendation or taking investment action.

Judge the suitability of investments in the context of the client’s total portfolio.

When Members and Candidates are responsible for managing a portfolio to a specific mandate, strategy, or style, they must make only investment recommendations or take only investment actions that are consistent with the stated objectives and constraints of the portfolio.

Question 3

developing IPS

Answer 3

financial circumstances
relevant personal data
risk attitude
invesment objectives

Question 4

IPS addresses:

Answer 4

client identification
investor objectives
investor constraints
performance measurement benchmarks