- CFA Exams
- CFA Level I Exam
- Topic 10. Ethical and Professional Standards
- Learning Module 71. Guidance for Standards I-VII
- Subject 7. Standard III (A) Loyalty, Prudence, and Care
CFA Practice Question
There are 356 practice questions for this topic.
CFA Practice Question
After work each day, Josh Miller, CFA, runs a popular Internet blog where he comments on micro-cap stocks. The blog includes a bio of Miller with his education and employment history. He receives no compensation for the blog. On the blog, Miller recommends purchases and sales of stocks based upon astrology. When blogging, Miller least likely violates CFA Institute Standard relating to ______.
A. Fair Dealing
B. Duty to Employer
C. Diligence and Reasonable Basis
Explanation: Miller's use of astrology as a research methodology violates the Standards relating to Loyalty, Prudence, and Care as well as Diligence and Reasonable Basis. His research methodology and blog may also reflect poorly on his employer and cause the employer harm. Miller is least likely to violate the standard relating to Fair Dealing because the blog is a method of mass communication that makes Miller's investment recommendations available to all readers simultaneously.
User Contributed Comments 6
|SMcalister||I was torn between A and B and could make a strong argument for both.
I can see how this *might* reflect poorly on the employer even though he's doing in his own time. It's odd to think that your employer can control you outside of work.
It definitely can't be fair dealing though. So A is the most correct answer.
|tomalot||Does anyone have a link to this blog? I'm a Leo FWIW|
|Stoibayev||You have to make an assumption that Josh is employed. The text construct is unnecessarily hazy!|
|weebe||Explanation says violates Diligence and Reasonable Basis, and I chose option C but it says C is incorrect.|
|weebe||my bad ... noticed the "Least Likely" in the question|
|gyee2012||The context is hazy, you have to infer that the employer is an investment firm. But in all honesty it is not black and white.
I should of chosen A for least likely. Answer C is for most likely.