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- Topic: Question on Ethics - Standard VI B - Priority of trades
| Author | Topic: Question on Ethics - Standard VI B - Priority of trades |
|---|---|
| 8937558 @2018-09-22 13:31:52 |
Hi guys, I am studying on the CFA Institue book and I found two concepts expressed in the same standard that I believe are colliding. Under the highlight "Avoiding potential conflicts" it's said that for an investment professional making money from personal investments it's not unethical as long as three precautions are taken, one of which is "the investment professional doesn't benefit personally from trades undertaken for clients". Further below, the highlight "Personal trading secondary to trading for clients" says "A member or candidate having the same investment position or being co-invested with clients doesn't always create a conflict". I am puzzled: what if an investment manager has his portfolio invested with those of other clients (co-investing with clients doesn't create a conflict) and all those portfolios sell/buy a stock and make a gain? According to the first part of the highlights "the investment professional doesn't benefit personally from trades undertaken for clients". But if the investment manager portfolio is under the same investment strategy as other clients' portfolios, he will obviously benefit from trades made for clients if they are making a gain too. Right? |
