CFA Practice Question

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CFA Practice Question

James Kon is the current manager of a firm's pension plan. To whom does James owe a fiduciary duty?
A. the management of the company
B. the plan's beneficiaries
C. the owners of the company
Explanation: The following are the responsibilities of a pension plan fiduciary:
  • To act solely in the interest of the plan.
  • To act for the exclusive purpose of providing benefits to the plan participants.
  • To act with the care, skill, prudence, and diligence as defined by the prudent man.
  • To diversify the plan's assets so as to minimize risk.
  • To refrain from engaging in prohibited transactions.

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