CFA Practice Question

There are 291 practice questions for this study session.

CFA Practice Question

Jacob Miller, CFA runs a mutual fund Enhanced Global Equity whose stated objective is to identify and invest in the equity of undervalued global firms. Miller believes that stock markets around the world are currently too high. He sells the equity holdings of the fund and invests in domestic corporate bonds (which he believes are currently undervalued). Has Miller violated the Standards?

A. Yes, Diligence and Reasonable Basis.
B. No.
C. Yes.
Correct Answer: C

Money managers must take investment decisions consistent with their stated objectives. For example, a money manager for a Global Equity fund investing in domestic corporate bonds would be a violation of suitability.

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