Standard IV (A.3) relates to two major components and is titled ________ and Objectivity.
Answer(s): E
Standard IV (A.3) - Independence and Objectivity, states that members shall use reasonable care and judgment to achieve and maintain independence and objectivity in making investment recommendations or taking investment action.
When a composite of international portfolios is created, firms should separate portfolios that are allowed to use currency ________ from portfolios that may not use ________, unless the use of currency ________ is considered immaterial. (Same answer for all three spaces)
Answer(s): B
If a firm makes significant use of currency hedging when allowed, it should separate portfolios that do not allow such hedging into a different composite and use a different benchmark for the highly hedged and unhedged composites. Similarly, portfolios with materially different risk exposures do not belong in the same composite.
Standard III (A) is ________.
Answer(s): C
Standard III (A) deals with the Obligation to Inform Employer of Code and Standards. Standard III (B) deals with the Duty to Employer. Standard III (C) deals with Disclosure of Conflicts to Employer. Standard III (D) deals with Disclosure of Additional Compensation Arrangements. Standard III (E) deals with Responsibilities of Supervisors.
Performance (relating to Performance Presentation Standards) is the record of the ________.
To be in compliance with the PPS, a firm's presentation of performance must comply on a firmwide basis and must consist of 10 years of performance (or records since the date of inception if the firm is younger than 10 years).
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