|Author||Topic: A CFA ethics problem - communication with clients|
|Claire Marlin, CFA, manages an investment fund specializing in foreign currency trading. Marlin writes a report to investors that describes the basic characteristics of her strategy, which is based on an expected appreciation of the euro relative to other major currencies. Marlin shows the projected returns from the strategy if the euro appreciates less than 5%, between 5 and 10, or more than 10%, while clearly stating that the forecasts are opinion. Has Marlin violated the Standard relative to communication with clients?
The answer is yes. But I thought because she stated it was an opinion and outlined possible outcomes that this was ok. Did she need to go into more detail or is she violating solely because the forecasts were shared?
|It's a hoaky question that kind of tries to misdirect with the "opinion" aspect.
She did not explain what happens if the euro declines and thus violated Standard V(B), which requires an explanation of relevant risks, including that actual and implied risks of a variety of possible interest rate / currency spread situations. Take a look at Example 3 in the CFA material under Standard V(B); it's basically the same question.
CFA Discussion Topic: A CFA ethics problem - communication with clients
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