QUESTION: 369

Performance Presentation Standards state that subsectors of larger international composites may be used to create stand-alone composites only if the subsectors are managed as ________ entities.

independent
two
unique
separate

Answer(s): D

Explanation:

Subsectors or carve-outs of larger international composites may be used to create stand-alone composites only if the subsectors are managed as separate entities with their own cash allocations and currency management.

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QUESTION: 370

Standard III (C) deals with conflicts of interest of a member with ________.

other investment professionals
none of these answers
the client
colleagues at the same firm
the investing public

Answer(s): B

Explanation:

Standard III (C) deals with conflicts of interest in any actions or decisions of a member with the employer.
Remember, all Standards under Standard III deal with the employer.

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QUESTION: 371

Standard IV (A.3) relates to two major components and is titled Independence and ________.

Objectivity
None of these answers
Impartiality
Autonomy
Justice

Answer(s): A

Explanation:

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.

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QUESTION: 372

Trisdale is a portfolio manager who has consistently outperformed the market on a risk-adjusted basis for the past 3 years. As an appreciation for his work, one of his clients recently gave him a travel package to Vancouver worth around $5,000. Trisdale informed his supervisor about this gift and then took time off from work to enjoy a vacation in Vancouver. Trisdale has

violated Standard III (D) - Disclosure of Additional Compensation Arrangements.
violated Standard IV (A.3) - Independence and Objectivity.
not violated the AIMR code of ethics.
violated Standard IV (B.3) - Fair Dealing.

Answer(s): C

Explanation:

The AIMR code of ethics does not preclude members from accepting gifts in excess of the modest amount of $100 from clients, as long as they are disclosed to the immediate supervisor. What the code does prohibit is acceptance of gifts in excess of $100 from parties that have a strong motive to influence the judgment of the members (e.g., companies that a member might be researching for investment recommendations). The disclosure of additional compensation arrangements with clients allows the supervisory authorities to monitor the portfolio activity and ensure that the gift-giving client's portfolio is not receiving any undue favorable treatment.

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Free CFA-Level-I Exam Braindumps (page: 93)

QUESTION: 369

Explanation:

QUESTION: 370

Explanation:

QUESTION: 371

Explanation:

QUESTION: 372

Explanation: