Ethics
2019
Instructor Jie
1Brief Introduction
Topic weight
Study Session 12 Ethics & Professional Standards 1015
Study Session 3 Quantitative Analysis 510
Study Session 4 Economics 510
Study Session 56 Financial Reporting and Analysis 1015
Study Session 78 Corporate Finance 510
Study Session 911 Equity Valuation 1015
Study Session 1213 Fixed Income 1015
Study Session 14 Derivative Investment 510
Study Session 15 Alternative Investment 510
Study Session 1617 Portfolio Management 515
Weights 100 2Brief Introduction
Content
➢ Study Session 1 Ethical and Professional Standards (1)
• Reading 1 Code of Ethics and Standards of Professional Conduct
( )
• Reading 2 Guidance for Standards Ⅰ Ⅶ ( )
➢ Study Session 2 Ethical and Professional Standards (2)
• Reading 3 Application of the Code and Standards ( )
• Reading 4 Trading Allocation Fair Dealing and Disclosure ( )
• Reading 5 Changing Investment Objectives ( )
3Brief Introduction
考纲
➢ 2018年相2019年考纲删CFA研究客观性标
准(Research Objectivity Standards)新增3案例分析
4Brief Introduction
学建议
➢ 门课程难度较高类似法条辨析
➢ 区分RequirementsRecommendations
➢ 注意细间关联性
➢ 阅读CFA Program Curriculum（CFA官方教材）
➢ 定做题推荐官方教材题历年模考题
5Professionalism
Tasks
➢ Demonstrate a thorough knowledge of the Code of
Ethics and Standards of Professional Conduct by
applying the Code and Standards to specific situations
➢ Recommend practices and procedures designed to
prevent violations of the Code of Ethics and Standards
of Professional Conduct 6Professionalism
Knowledge of the Law
➢ Most strict
➢ First – notify supervisor or compliance
➢ May confront wrongdoer directly
➢ Dissociate if necessary
➢ Inaction may be construed as participation
➢ No requirement to report violations to governmental
authorities but this may be appropriate in certain cases 7Independence and Objectivity
➢ Modest gifts OK
➢ Distinguish between gifts from clients and gifts from
entities trying to influence
➢ May accept gift from clients – must disclose to employer
– must get permission if gift is for future performance
➢ Investment banking relationships – do not bow to
pressure to issue favorable research
➢ For issuerpaid research flat fee structure is preferred
Professionalism
8Misrepresentation
➢ Standard covers oral written or electronic
communications
➢ Do not misrepresent qualifications services of self or
firm or performance record characteristics of an
investment
➢ Do not guarantee a certain return
➢ No plagiarism – written or oral communications
Professionalism
9Misconduct
➢ This Standard covers conduct that may not be illegal
but could adversely affect a member’s ability to perform
duties
Professionalism
10➢ Importance ☆☆☆
➢ Content
• Standards of Professional Conduct
➢ Exam tips
• 熟悉细容常见考点实务情景中正确运
细
Summary
11Integrity of Capital Market
Tasks
➢ Demonstrate a thorough knowledge of the Code of
Ethics and Standards of Professional Conduct by
applying the Code and Standards to specific situations
➢ Recommend practices and procedures designed to
prevent violations of the Code of Ethics and Standards
of Professional Conduct 12Material NonPublic Information
➢ Material – if disclosure of information would impact a
security’s price or if reasonable investors would want the
information before making an investment decision
➢ Information is nonpublic until it has been made
available to the marketplace
➢ Information made available to analysts is considered
nonpublic until it is made available to investors in general
➢ Mosaic Theory
Integrity of Capital Market
13Market Manipulation
➢ Do not engage in transactionbased manipulation –
give false impression of activity price movement gain
dominant position in an asset to manipulate price of
the asset or a related derivative
➢ Do not distribute false misleading information
Integrity of Capital Market
14➢ Importance ☆☆☆
➢ Content
• Standards of Professional Conduct
➢ Exam tips
• 熟悉细容常见考点实务情景中正确运
细
Summary
15Duties to Clients
Tasks
➢ Demonstrate a thorough knowledge of the Code of
Ethics and Standards of Professional Conduct by
applying the Code and Standards to specific situations
➢ Recommend practices and procedures designed to
prevent violations of the Code of Ethics and Standards
of Professional Conduct 16Loyalty Prudence and Care
➢ Take investment actions in client’s best interests
➢ Exercise prudence care skill and diligence
➢ Follow applicable fiduciary duty
➢ Manage pools of client assets according to terms of
governing documents
➢ Make investment decisions in context of total portfolio
➢ Vote proxies responsibly and disclose proxy voting
policies to clients
➢ Soft dollars must benefit client
Duties to Clients
17Fair Dealing
➢ Different levels of service okay as long as disclosed
and does not disadvantage any clients
➢ Investment recommendations all clients must have
fair chance to act on every recommendation
➢ Investment actions treat all clients fairly – consider
investment objectives circumstances
Duties to Clients
18Suitability
➢ When in advisory relationship gather client
information at the outset and prepare IPS
➢ Update IPS at least annually
➢ Consider whether leverage (derivatives) is suitable
for client
➢ If managing a fund to an index or other mandate
invest according to mandate
Duties to Clients
19Performance Presentation
➢ Do not misstate performance or mislead clients
about investment performance
➢ Do not state or imply ability to achieve returns
similar to those achieved in the past
Duties to Clients
20Preservation of Confidentiality
➢ In some cases it may be required by law to report
activities to relevant authorities
➢ This Standard extends to former clients
➢ Exception May provide confidential information to
CFA Institute for an investigation under Professional
Conduct Program
Duties to Clients
21➢ Importance ☆☆☆
➢ Content
• Standards of Professional Conduct
➢ Exam tips
• 熟悉细容常见考点实务情景中正确运
细
Summary
22Duties to Employers
Tasks
➢ Demonstrate a thorough knowledge of the Code of
Ethics and Standards of Professional Conduct by
applying the Code and Standards to specific situations
➢ Recommend practices and procedures designed to
prevent violations of the Code of Ethics and Standards
of Professional Conduct 23Loyalty
➢ Loyalty – Independent practice
✓ If planning to engage in independent practice notify
employer of services provided expected duration
and compensation
✓ Do not proceed without consent from employer
Duties to Employers
24➢ Loyalty – Leaving an employer
✓ If seeking new employment act in best interest of
employer until resignation is effective
✓ Do not take records or files without permission
✓ Simple knowledge of names of former clients is OK
➢ Loyalty – Whistleblowing
✓ Permitted only if it protects client or integrity of
capital markets
✓ Not permitted for personal gain
Duties to Employers
25Additional Compensation Arrangements
➢ Compensation and benefits covers direct
compensation by the client and other benefits
received from third parties
➢ For written consent from all parties involved
email is acceptable
Duties to Employers
26Responsibilities of Supervisors
➢ Supervisors must take steps to prevent employees
from violating laws rules regulations or the Code
and Standards
➢ Supervisors must make reasonable efforts to detect
violations
Duties to Employers
27➢ Importance ☆☆☆
➢ Content
• Standards of Professional Conduct
➢ Exam tips
• 熟悉细容常见考点实务情景中正确运
细
Summary
28Investment Analysis Recommendations
and Actions
Tasks
➢ Demonstrate a thorough knowledge of the Code of
Ethics and Standards of Professional Conduct by
applying the Code and Standards to specific situations
➢ Recommend practices and procedures designed to
prevent violations of the Code of Ethics and Standards
of Professional Conduct 29Diligence and Reasonable Basis
➢ Make reasonable efforts to cover all relevant issues
when arriving at an investment recommendation
➢ Determine soundness when using secondary or third
party research
➢ Group research and decision making As long as there is
reasonable basis for opinion member does not
necessarily have to agree with the opinion
Investment Analysis Recommendations and Actions
30Communications with Clients and Prospective Clients
➢ Distinguish between facts and opinions
➢ Include basic characteristics of the security
➢ Inform clients of any change in investment processes
➢ Suitability of investment – portfolio context
➢ All communication covered not just reports
Investment Analysis Recommendations and Actions
31Record Retention
➢ Maintain records to support research and the rationale
for conclusions and actions
➢ Records are firm’s property and cannot be taken when
member leaves without firm’s consent
➢ If no regulatory requirement CFA Institute recommends
retention period of 7 years
Investment Analysis Recommendations and Actions
32➢ Importance ☆☆☆
➢ Content
• Standards of Professional Conduct
➢ Exam tips
• 熟悉细容常见考点实务情景中正确运
细
Summary
33Conflicts of Interest
Tasks
➢ Demonstrate a thorough knowledge of the Code of
Ethics and Standards of Professional Conduct by
applying the Code and Standards to specific situations
➢ Recommend practices and procedures designed to
prevent violations of the Code of Ethics and Standards
of Professional Conduct 34Disclosure of Conflicts
➢ Disclose to clients
✓ All matters that could impair objectivity – allow clients
to judge motives biases For example between
member or firm and issuer investment banking
relations broker activities significant stock
ownership board service
Conflicts of Interest
35Disclosure of Conflicts
➢ Disclose to employers
✓ Conflicts of interest – ownership of stock board
participation financial and other pressures that may
influence decisions
✓ Conflicts that could be damaging to employer’s
business
Conflicts of Interest
36Priority of Transaction
➢ Beneficial owner – has direct indirect personal
interest in the securities
➢ Client employer transactions take priority over
personal transactions (including beneficial ownership)
➢ Family member accounts that are client accounts must
be treated as other client accounts
Conflicts of Interest
37Referral Fees
➢ Disclosure allows clients and employers to evaluate
full cost of service and any potential biases
➢ Disclosure is to be made prior to entering into any
formal agreement for services
➢ Disclose the nature of the consideration
Conflicts of Interest
38➢ Importance ☆☆☆
➢ Content
• Standards of Professional Conduct
➢ Exam tips
• 熟悉细容常见考点实务情景中正确运
细
Summary
39Responsibilities as a CFA Institute Member
or a CFA Candidate
Tasks
➢ Demonstrate a thorough knowledge of the Code of
Ethics and Standards of Professional Conduct by
applying the Code and Standards to specific situations
➢ Recommend practices and procedures designed to
prevent violations of the Code of Ethics and Standards
of Professional Conduct 40Conduct as Members and Candidates in the CFA Program
➢ Conducts that violate the standard include
✓ Cheating on the exam
✓ Disregarding rules and policies or security measures related
to exam administration
✓ Giving confidential information to candidates or public
✓ Improper use of CFA designation to further personal and
professional objectives
✓ Misrepresenting the CFA Institute Professional
Development Program or the Professional Conduct
Statement
Responsibilities as a CFA Institute Member or a CFA Candidate
41Reference to the CFA Institute the CFA Designation
and the CFA Program
➢ Complete PCS annually
➢ Pay membership dues annually
➢ Don’t misrepresent or exaggerate the meaning of
holding the CFA designation
➢ No partial designation
➢ The Chartered Financial Analyst and CFA marks
must always be used either after a charterholder’s
name or as adjectives not as nouns
Responsibilities as a CFA Institute Member or a CFA Candidate
42➢ Importance ☆☆☆
➢ Content
• Standards of Professional Conduct
➢ Exam tips
• 熟悉细容常见考点实务情景中正确运
细
Summary
43Case Study [1]
44Case Study [2]
Rudy Embiid CFA is a senior analyst at Hogwarts Financial
Consultants Hogwarts provides investment advice and strategy
research to highnetworth individuals It has adopted the CFA
Institute Code and Standards to demonstrate that their
recommendations are objective and are made based on
independent research
45Case Study [2]
Recently Embiid receives a request from a client to study a
pharmaceutical company named Novartis Gleevy The company’s
main product is a drug for the treatment of chronic leukemia
Embiid investigates one hundred drugstores that sell this drug
across the country and finds that compared with other drugs this
drug’s production date is the most recent Based on this
information he infers that the drug is very popular in the market
With further reasonable and adequate analysis he and his team
write a research report and make a buy recommendation for
Novartis Gleevy
46Case Study [2]
Albus Dumbledore one of his team members disagrees with the
buy recommendation but still signs his name in the report Before
distributing the report to clients Embiid sends the whole report to
the company’s CEO prior to its publication
47Case Study [2]
Mike Conley who has been working for Novartis Gleevy for nearly
thirty years is a conservative investor What’s more Conley
happens to be a longtime client of Hogwarts Financial Consultants
After reading Embiid’s analysis report about Novartis Gleevy
Conley calls Embiid to ask whether he should raise his investment
percentage in Novartis Gleevy to 80 Embiid replies As an
employee of Novartis Gleevy you know the efficacy of your
company’s new drug better than I do Consider its promising future
there is no better time to increase investment in Novartis Gleevy’s
stocks In my opinion the price of this stock will double in a year
48Case Study [2]
Seven months later Embiid receives a call from Conley Conley
expresses his gratitude to Embiid because he has earned two
million dollars by adopting Embiid’s investment advice Conley asks
Embiid if he could write more reports for him and he will pay a
normal fee plus a bonus if the recommendation is accurate Embiid
agrees with the Conley’s offer He reports this deal to his supervisor
but doesn’t disclose the details about incentive structure
49Case Study [2]
Hogwarts Financial Consultants continues expanding its business
and recently hired Ben Simmons as Embiid’s assistant Simmons
just passed Level II of the CFA exams and is about to prepare the
Level III exam He has heard that Level III exam structure is quite
different from Level I and Level II exams as it includes constructed
response (essay) questions In order to improve learning efficiency
Simmons asks Embiid whether he can provide some tips about the
exam And here is how Embiid responds
50Case Study [2]
There is no shortcut to pass Level III exam All knowledge included
in LOS may be tested in the exam However you should pay
attention to the command words in the LOS LOS command words
indicate what you should learn from each assignment especially
for command words like critique’ discuss’ and prepare’ which
only appear in CFA Level III What’s more I remember that when I
took the practice exam it seemed to have a heavier weights on
wealth planning and fixed income You should notice that
51Case Study [2]
Simmons only works for Hogwarts for just two months and then
joins Medal Fund When he leaves Hogwarts he takes nothing
except clients’ contact information After joining Medal Fund
Simmons recreates the BSM model that he used in Hogwarts to
analyze option prices
52Case Study [2]
1 Does Embiid most likely violate the Standard II(A) Material
Nonpublic Information when he reaches the buy recommendation
for Novartis Gleevy
A No because the information is nonmaterial
B No because the information is public
C Yes
53Case Study [2]
答案：A
考点：Standard II(A) Material Nonpublic Information
解析：Embiid根调研100家分布全国药店发现格列
宁药生产日期般较新间接推断出该药销售量
较首先信息通身调研非公开渠道获
次material information实际证券分析师工
作通种公开信息非公开非重信息推断公司
股价未走势Embiid行违反准选A
54Case Study [2]
2 With regard to writing and distributing the reports does either
Embiid or Dumbledore violate the CFA Institute Standards of
Professional Conduct
A Yes Embiid should not send the report to CEO before
distribution
B Yes Dumbledore should not sign his name in the report
C No
55Case Study [2]
答案：A
考点：Standard V(A) Diligence and Reasonable Basis
解析：分析报告公开前Embiid报告中关客观
事实部分发象公司CEO审核整份报告（尤
含推荐级报告）发CEO选A分析报告
分析充分勤勉义务算Dumbledore意报告推
荐级报告签字B错C错
56Case Study [2]
3 Does Embiid’s statements to Conley most likely violate the CFA
Institute Standards of Professional Conduct
A Yes because of his statement about increasing amount of
investment in Novartis Gleevy
B Yes because of his forecast about the stock price
C No
57Case Study [2]
答案：A
考点：Standard III(C) Suitability Standard V(B) Communication
with Clients and Prospective Clients
解析：Embiid强调未股价翻倍观点
事实没违反准 B错题目信息中知
Conley保守投资者身格列宁员工
幅提高公司股票疑风险(尤达80
配)安然事件中许安然员工身家公
司股票安然事件发生导致终破产终收益
样资产配置适合ConleyC错选A
58Case Study [2]
4 With regard to the Conley’s request for the new report is there
any violation of the CFA Institute Standard of Practice and
Professional Conduct
A No
B Yes regarding the fee structure only
C Yes because he doesn’t disclose the fee structure to his
supervisor
59Case Study [2]
答案：C
考点：Standard IV(A) Loyalty
解析：里需注意题讨客户提供费结构
评级机构证券分析师说预测准确客户愿意
付钱天义种费结构没违反准
费结构必须级汇报杜绝种现象：
客户钱分析师私顾客户忽略
客户选C
60Case Study [2]
5 Does Embiid violate Standard VII Responsibilities as a CFA
Institute Member
A Yes because of his talks about LOS command words
B Yes because of his talks about weightings in the practice exam
C No
61Case Study [2]
答案：C
考点：Standard VII(A) Conduct as Participants in CFA Institute
Programs
解析：EmbiidSimmons讨关考试公开信息
没违反条准关LOS command word相关信息
协会网站公开载机密信息关科
目中权重协会官网找样机密信息
讨官方practice exam中权重真题
果两讨关三级考试午题真题容违反
准七
62Case Study [2]
6 When Simmons leaves Hogwarts is there any violation of the
CFA Institute Standard of Practice and Professional Conduct
A Yes regarding the client list only
B Yes regarding the recreation the BSM model only
C Yes regarding both the client list and the BSM model
63Case Study [2]
答案：A
考点：Standard IV(A) Loyalty
解析：员工离职时学知识技术外什
带走题干中强调Simmons仅带走客户名单
违反职业道德选A外Simmons重新构建模型
没违反准首先BSM模型公知识非某公司专
知识产权Simmons基原公司文件（已编
程序EXCEL VBA文档）构建模型没违规
64Case Study [2]
65Case Study [2]
Daryl Morey a CFA charterholder and former portfolio manager of
Celtic Securities is recently hired by Rocket Financial Servicer as a
compliance officer Rocket Financial Servicer is a small regional
asset management firm providing wealth management services
mainly to highnetworth individuals
66Case Study [2]
Morey’s first task in Rocket is to revise the firm’s compliance policy
and establish an appropriate incentive structure for research
activities After reviewing current related documents Morey is
astonished to find that Rocket’s compliance policies and
procedures haven’t changed since the firm’s inception In order to
deal with the inspection from SEC next month Morey copies the
whole documents of compliance policy in Celtic Securities with
only a few modifications He plans to establish a new system of
compliance policies to reflect any regulatory changes over the past
years after SEC’s inspection
67Case Study [2]
One month after the SEC’s inspection Morey sets up new
regulations on the incentive structure for research activities
Specifically Morey drafts the following policy statements
Statement 1 Employees must disclose all conflicts of interest to
their employer and current clients
Statement 2 Employees should never differentiate their services to
clients
Statement 3 Disclose all compensation arrangements
68Case Study [2]
Morey also checks Rocket’s criteria of selecting brokers He finds
that Rocket changes its broker every year and it seems that there is
no consistent standard of picking proper broker for the company
So he recommends that the selection of brokers should be based
on the following three standards
Standard 1 the broker’s ability to offer different kinds of strategy
meeting for Rocket’s investors
Standard 2 the broker’s ability to offer financial data terminals like
Bloomberg or Thomson Reuters
Standard 3 the broker’s ability to seek the best execution
69Case Study [2]
Chris Harden a star research analyst who has been working for
Rocket over ten years is in charge of writing analysis reports about
TMT industry Harden usually keeps his reports of
recommendations for six years However Morey has found that CFA
Institute recommends maintaining records for at least seven years
while local legal statutes only require five years Harden has a habit
of going to nightclub every Sunday and having numerous drinks
Back at work the next day he is always intoxicated when he makes
investment recommendations However the accuracy rate of his
recommendations is far above average
70Case Study [2]
When reviewing client investment record Morey discovers that
some transactions for clients are slower than Harden’s personal
account Harden argues that he has sent the investment
recommendations to all clients He didn’t trade until the moment
he pressed the send button Morey verbally criticizes Harden and
tells him to give clients more time to respond next time
71Case Study [2]
In order to improve clients’ confidence level for company’s
research team Morey puts an advertisement on its official website
which says Each member of our research team is Expert CFA and
all of them passed each level of the CFA exam on their first attempt
which implies our research team is more professional
72Case Study [2]
1 About his actions related to his first task Morey least likely
violates the CFA Institute Standards of Professional Conduct
concerning which of the following
A Loyalty to employer
B Responsibilities of Supervisors
C Preservation of Confidentiality
73Case Study [2]
答案：C
考点：Standard III(E) Preservation of Confidentiality Standard IV(A)
Loyalty Standard IV(C) Responsibilities of Supervisors
解析：Morey前雇Celtic Securities文档直接拷贝
仅做修改作新雇合规制度违反雇忠
诚员工离开公司时公司学知识技外
文件带走A错作监者Morey应付
SEC检查匆忙建立完善合规制度必须时反映
关监法规新求B错Preservation of Confidentiality
指客户机密信息保密雇关选C
74Case Study [2]
2 Which of Morey’s policy statements about regulations on the
incentive structure for research activities least likely violates the
CFA Institute Standards of Professional Conduct
A Statement 1 and statement 3
B Statement 2 and statement 3
C Only statement 3
75Case Study [2]
答案：C
考点：Standard VI(A) Disclosure of Conflicts Standard III(B) Fair
Dealing
解析：conflicts of interest披露雇客户够
潜客户（Prospective client）披露潜客户宣传公
司产品时披露利益突否显然骗A错作
提供服务公司然客户提供类服务
（更服务收费更已）B错
76Case Study [2]
3 Which standard with regard to selecting a proper broker is most
likely consistent with Standard III(A) Loyalty Prudence and Care
A Standard 1
B Standard 2
C Standard 3
77Case Study [2]
答案：C
考点：Standard III(A) Loyalty Prudence and Care
解析：选择broker时注意提供软美元（soft dollars）
定客户公司外选
取broker定够寻求best pricebest execute
选CAB均错A求broker客户提供参加策略会议
机会B求broker够提供诸彭博路透类金融数终
端然客户提供定客户群体需
求判断soft dollar否满足客户需求时注意找关键词
best pricebest execute
78Case Study [2]
4 Which of Harden’s activities most likely violate the CFA Institute
Standards of Professional Conduct His activities with regard to
A keeping his reports of recommendations for six years
B going to nightclub every Sunday
C Both of the above actions
79Case Study [2]
答案：B
考点：Standard IV(D) Misconduct Standard V(C) Record Retention
解析：CFA道德求适法规CFA准突时遵
更严格规定里情况较特殊CFA准中明确指
出果没相关法规CFA准建议记录保存七年
果法规规定遵法规（题中
法规求五年）A错Harden投资推荐准确率
高般水然违反相关准（渎职）
夜店喝醉行直接影响第二天工作（文中指出喝
酒第二天班明显酒精中毒）较高推荐准确率
免责（喝酒准确率更高纯属运气） 80Case Study [2]
5 With regard to transactions for clients does either Morey or
Harden violate CFA Institute Standards of Professional Conduct
A Yes Harden violates VI(B) Priority of Transactions
B Yes Morey violates Standard IV(C) Responsibilities of
Supervisors
C Both of the above
81Case Study [2]
答案：C
考点：Standard VI(B) Priority of Transactions Standard IV(C)
Responsibilities of Supervisors
解析：Harden违反fair dealing然Harden发客户研
究报告交易然行必须足客户阅读报告
根报告交易时间（点击邮件发送钮交易显然没
足客户时间）Morey违反监者职责仅仅口头批
评Harden告知例够必须章程次行
予相应惩罚
82Case Study [2]
6 Which of the following statements in the advertisement least
likely violates the CFA Institute Standards of Professional Conduct
A Each member of our research team are Expert CFA
B All members of the team have passed the exams on the first try
C Our research team is more professional
83Case Study [2]
答案：B
考点：VII(B) Reference to CFA Institute the CFA Designation and
CFA Program
解析：意引协会认关CFA称号文中
Expert CFAA错文字暗示表明拥CFA头
衔意味着力更强业绩更C错仅仅陈述成员
次性通CFA考试没违法准仅仅陈
述事实选B
84
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2019
Instructor Jie
1Brief Introduction
Topic weight
Study Session 12 Ethics & Professional Standards 1015
Study Session 3 Quantitative Analysis 510
Study Session 4 Economics 510
Study Session 56 Financial Reporting and Analysis 1015
Study Session 78 Corporate Finance 510
Study Session 911 Equity Valuation 1015
Study Session 1213 Fixed Income 1015
Study Session 14 Derivative Investment 510
Study Session 15 Alternative Investment 510
Study Session 1617 Portfolio Management 515
Weights 100 2Brief Introduction
Content
➢ Study Session 1 Ethical and Professional Standards (1)
• Reading 1 Code of Ethics and Standards of Professional Conduct
( )
• Reading 2 Guidance for Standards Ⅰ Ⅶ ( )
➢ Study Session 2 Ethical and Professional Standards (2)
• Reading 3 Application of the Code and Standards ( )
• Reading 4 Trading Allocation Fair Dealing and Disclosure ( )
• Reading 5 Changing Investment Objectives ( )
3Brief Introduction
考纲
➢ 2018年相2019年考纲删CFA研究客观性标
准(Research Objectivity Standards)新增3案例分析
4Brief Introduction
学建议
➢ 门课程难度较高类似法条辨析
➢ 区分RequirementsRecommendations
➢ 注意细间关联性
➢ 阅读CFA Program Curriculum（CFA官方教材）
➢ 定做题推荐官方教材题历年模考题
5Professionalism
Tasks
➢ Demonstrate a thorough knowledge of the Code of
Ethics and Standards of Professional Conduct by
applying the Code and Standards to specific situations
➢ Recommend practices and procedures designed to
prevent violations of the Code of Ethics and Standards
of Professional Conduct 6Professionalism
Knowledge of the Law
➢ Most strict
➢ First – notify supervisor or compliance
➢ May confront wrongdoer directly
➢ Dissociate if necessary
➢ Inaction may be construed as participation
➢ No requirement to report violations to governmental
authorities but this may be appropriate in certain cases 7Independence and Objectivity
➢ Modest gifts OK
➢ Distinguish between gifts from clients and gifts from
entities trying to influence
➢ May accept gift from clients – must disclose to employer
– must get permission if gift is for future performance
➢ Investment banking relationships – do not bow to
pressure to issue favorable research
➢ For issuerpaid research flat fee structure is preferred
Professionalism
8Misrepresentation
➢ Standard covers oral written or electronic
communications
➢ Do not misrepresent qualifications services of self or
firm or performance record characteristics of an
investment
➢ Do not guarantee a certain return
➢ No plagiarism – written or oral communications
Professionalism
9Misconduct
➢ This Standard covers conduct that may not be illegal
but could adversely affect a member’s ability to perform
duties
Professionalism
10➢ Importance ☆☆☆
➢ Content
• Standards of Professional Conduct
➢ Exam tips
• 熟悉细容常见考点实务情景中正确运
细
Summary
11Integrity of Capital Market
Tasks
➢ Demonstrate a thorough knowledge of the Code of
Ethics and Standards of Professional Conduct by
applying the Code and Standards to specific situations
➢ Recommend practices and procedures designed to
prevent violations of the Code of Ethics and Standards
of Professional Conduct 12Material NonPublic Information
➢ Material – if disclosure of information would impact a
security’s price or if reasonable investors would want the
information before making an investment decision
➢ Information is nonpublic until it has been made
available to the marketplace
➢ Information made available to analysts is considered
nonpublic until it is made available to investors in general
➢ Mosaic Theory
Integrity of Capital Market
13Market Manipulation
➢ Do not engage in transactionbased manipulation –
give false impression of activity price movement gain
dominant position in an asset to manipulate price of
the asset or a related derivative
➢ Do not distribute false misleading information
Integrity of Capital Market
14➢ Importance ☆☆☆
➢ Content
• Standards of Professional Conduct
➢ Exam tips
• 熟悉细容常见考点实务情景中正确运
细
Summary
15Duties to Clients
Tasks
➢ Demonstrate a thorough knowledge of the Code of
Ethics and Standards of Professional Conduct by
applying the Code and Standards to specific situations
➢ Recommend practices and procedures designed to
prevent violations of the Code of Ethics and Standards
of Professional Conduct 16Loyalty Prudence and Care
➢ Take investment actions in client’s best interests
➢ Exercise prudence care skill and diligence
➢ Follow applicable fiduciary duty
➢ Manage pools of client assets according to terms of
governing documents
➢ Make investment decisions in context of total portfolio
➢ Vote proxies responsibly and disclose proxy voting
policies to clients
➢ Soft dollars must benefit client
Duties to Clients
17Fair Dealing
➢ Different levels of service okay as long as disclosed
and does not disadvantage any clients
➢ Investment recommendations all clients must have
fair chance to act on every recommendation
➢ Investment actions treat all clients fairly – consider
investment objectives circumstances
Duties to Clients
18Suitability
➢ When in advisory relationship gather client
information at the outset and prepare IPS
➢ Update IPS at least annually
➢ Consider whether leverage (derivatives) is suitable
for client
➢ If managing a fund to an index or other mandate
invest according to mandate
Duties to Clients
19Performance Presentation
➢ Do not misstate performance or mislead clients
about investment performance
➢ Do not state or imply ability to achieve returns
similar to those achieved in the past
Duties to Clients
20Preservation of Confidentiality
➢ In some cases it may be required by law to report
activities to relevant authorities
➢ This Standard extends to former clients
➢ Exception May provide confidential information to
CFA Institute for an investigation under Professional
Conduct Program
Duties to Clients
21➢ Importance ☆☆☆
➢ Content
• Standards of Professional Conduct
➢ Exam tips
• 熟悉细容常见考点实务情景中正确运
细
Summary
22Duties to Employers
Tasks
➢ Demonstrate a thorough knowledge of the Code of
Ethics and Standards of Professional Conduct by
applying the Code and Standards to specific situations
➢ Recommend practices and procedures designed to
prevent violations of the Code of Ethics and Standards
of Professional Conduct 23Loyalty
➢ Loyalty – Independent practice
✓ If planning to engage in independent practice notify
employer of services provided expected duration
and compensation
✓ Do not proceed without consent from employer
Duties to Employers
24➢ Loyalty – Leaving an employer
✓ If seeking new employment act in best interest of
employer until resignation is effective
✓ Do not take records or files without permission
✓ Simple knowledge of names of former clients is OK
➢ Loyalty – Whistleblowing
✓ Permitted only if it protects client or integrity of
capital markets
✓ Not permitted for personal gain
Duties to Employers
25Additional Compensation Arrangements
➢ Compensation and benefits covers direct
compensation by the client and other benefits
received from third parties
➢ For written consent from all parties involved
email is acceptable
Duties to Employers
26Responsibilities of Supervisors
➢ Supervisors must take steps to prevent employees
from violating laws rules regulations or the Code
and Standards
➢ Supervisors must make reasonable efforts to detect
violations
Duties to Employers
27➢ Importance ☆☆☆
➢ Content
• Standards of Professional Conduct
➢ Exam tips
• 熟悉细容常见考点实务情景中正确运
细
Summary
28Investment Analysis Recommendations
and Actions
Tasks
➢ Demonstrate a thorough knowledge of the Code of
Ethics and Standards of Professional Conduct by
applying the Code and Standards to specific situations
➢ Recommend practices and procedures designed to
prevent violations of the Code of Ethics and Standards
of Professional Conduct 29Diligence and Reasonable Basis
➢ Make reasonable efforts to cover all relevant issues
when arriving at an investment recommendation
➢ Determine soundness when using secondary or third
party research
➢ Group research and decision making As long as there is
reasonable basis for opinion member does not
necessarily have to agree with the opinion
Investment Analysis Recommendations and Actions
30Communications with Clients and Prospective Clients
➢ Distinguish between facts and opinions
➢ Include basic characteristics of the security
➢ Inform clients of any change in investment processes
➢ Suitability of investment – portfolio context
➢ All communication covered not just reports
Investment Analysis Recommendations and Actions
31Record Retention
➢ Maintain records to support research and the rationale
for conclusions and actions
➢ Records are firm’s property and cannot be taken when
member leaves without firm’s consent
➢ If no regulatory requirement CFA Institute recommends
retention period of 7 years
Investment Analysis Recommendations and Actions
32➢ Importance ☆☆☆
➢ Content
• Standards of Professional Conduct
➢ Exam tips
• 熟悉细容常见考点实务情景中正确运
细
Summary
33Conflicts of Interest
Tasks
➢ Demonstrate a thorough knowledge of the Code of
Ethics and Standards of Professional Conduct by
applying the Code and Standards to specific situations
➢ Recommend practices and procedures designed to
prevent violations of the Code of Ethics and Standards
of Professional Conduct 34Disclosure of Conflicts
➢ Disclose to clients
✓ All matters that could impair objectivity – allow clients
to judge motives biases For example between
member or firm and issuer investment banking
relations broker activities significant stock
ownership board service
Conflicts of Interest
35Disclosure of Conflicts
➢ Disclose to employers
✓ Conflicts of interest – ownership of stock board
participation financial and other pressures that may
influence decisions
✓ Conflicts that could be damaging to employer’s
business
Conflicts of Interest
36Priority of Transaction
➢ Beneficial owner – has direct indirect personal
interest in the securities
➢ Client employer transactions take priority over
personal transactions (including beneficial ownership)
➢ Family member accounts that are client accounts must
be treated as other client accounts
Conflicts of Interest
37Referral Fees
➢ Disclosure allows clients and employers to evaluate
full cost of service and any potential biases
➢ Disclosure is to be made prior to entering into any
formal agreement for services
➢ Disclose the nature of the consideration
Conflicts of Interest
38➢ Importance ☆☆☆
➢ Content
• Standards of Professional Conduct
➢ Exam tips
• 熟悉细容常见考点实务情景中正确运
细
Summary
39Responsibilities as a CFA Institute Member
or a CFA Candidate
Tasks
➢ Demonstrate a thorough knowledge of the Code of
Ethics and Standards of Professional Conduct by
applying the Code and Standards to specific situations
➢ Recommend practices and procedures designed to
prevent violations of the Code of Ethics and Standards
of Professional Conduct 40Conduct as Members and Candidates in the CFA Program
➢ Conducts that violate the standard include
✓ Cheating on the exam
✓ Disregarding rules and policies or security measures related
to exam administration
✓ Giving confidential information to candidates or public
✓ Improper use of CFA designation to further personal and
professional objectives
✓ Misrepresenting the CFA Institute Professional
Development Program or the Professional Conduct
Statement
Responsibilities as a CFA Institute Member or a CFA Candidate
41Reference to the CFA Institute the CFA Designation
and the CFA Program
➢ Complete PCS annually
➢ Pay membership dues annually
➢ Don’t misrepresent or exaggerate the meaning of
holding the CFA designation
➢ No partial designation
➢ The Chartered Financial Analyst and CFA marks
must always be used either after a charterholder’s
name or as adjectives not as nouns
Responsibilities as a CFA Institute Member or a CFA Candidate
42➢ Importance ☆☆☆
➢ Content
• Standards of Professional Conduct
➢ Exam tips
• 熟悉细容常见考点实务情景中正确运
细
Summary
43Case Study [1]
44Case Study [2]
Rudy Embiid CFA is a senior analyst at Hogwarts Financial
Consultants Hogwarts provides investment advice and strategy
research to highnetworth individuals It has adopted the CFA
Institute Code and Standards to demonstrate that their
recommendations are objective and are made based on
independent research
45Case Study [2]
Recently Embiid receives a request from a client to study a
pharmaceutical company named Novartis Gleevy The company’s
main product is a drug for the treatment of chronic leukemia
Embiid investigates one hundred drugstores that sell this drug
across the country and finds that compared with other drugs this
drug’s production date is the most recent Based on this
information he infers that the drug is very popular in the market
With further reasonable and adequate analysis he and his team
write a research report and make a buy recommendation for
Novartis Gleevy
46Case Study [2]
Albus Dumbledore one of his team members disagrees with the
buy recommendation but still signs his name in the report Before
distributing the report to clients Embiid sends the whole report to
the company’s CEO prior to its publication
47Case Study [2]
Mike Conley who has been working for Novartis Gleevy for nearly
thirty years is a conservative investor What’s more Conley
happens to be a longtime client of Hogwarts Financial Consultants
After reading Embiid’s analysis report about Novartis Gleevy
Conley calls Embiid to ask whether he should raise his investment
percentage in Novartis Gleevy to 80 Embiid replies As an
employee of Novartis Gleevy you know the efficacy of your
company’s new drug better than I do Consider its promising future
there is no better time to increase investment in Novartis Gleevy’s
stocks In my opinion the price of this stock will double in a year
48Case Study [2]
Seven months later Embiid receives a call from Conley Conley
expresses his gratitude to Embiid because he has earned two
million dollars by adopting Embiid’s investment advice Conley asks
Embiid if he could write more reports for him and he will pay a
normal fee plus a bonus if the recommendation is accurate Embiid
agrees with the Conley’s offer He reports this deal to his supervisor
but doesn’t disclose the details about incentive structure
49Case Study [2]
Hogwarts Financial Consultants continues expanding its business
and recently hired Ben Simmons as Embiid’s assistant Simmons
just passed Level II of the CFA exams and is about to prepare the
Level III exam He has heard that Level III exam structure is quite
different from Level I and Level II exams as it includes constructed
response (essay) questions In order to improve learning efficiency
Simmons asks Embiid whether he can provide some tips about the
exam And here is how Embiid responds
50Case Study [2]
There is no shortcut to pass Level III exam All knowledge included
in LOS may be tested in the exam However you should pay
attention to the command words in the LOS LOS command words
indicate what you should learn from each assignment especially
for command words like critique’ discuss’ and prepare’ which
only appear in CFA Level III What’s more I remember that when I
took the practice exam it seemed to have a heavier weights on
wealth planning and fixed income You should notice that
51Case Study [2]
Simmons only works for Hogwarts for just two months and then
joins Medal Fund When he leaves Hogwarts he takes nothing
except clients’ contact information After joining Medal Fund
Simmons recreates the BSM model that he used in Hogwarts to
analyze option prices
52Case Study [2]
1 Does Embiid most likely violate the Standard II(A) Material
Nonpublic Information when he reaches the buy recommendation
for Novartis Gleevy
A No because the information is nonmaterial
B No because the information is public
C Yes
53Case Study [2]
答案：A
考点：Standard II(A) Material Nonpublic Information
解析：Embiid根调研100家分布全国药店发现格列
宁药生产日期般较新间接推断出该药销售量
较首先信息通身调研非公开渠道获
次material information实际证券分析师工
作通种公开信息非公开非重信息推断公司
股价未走势Embiid行违反准选A
54Case Study [2]
2 With regard to writing and distributing the reports does either
Embiid or Dumbledore violate the CFA Institute Standards of
Professional Conduct
A Yes Embiid should not send the report to CEO before
distribution
B Yes Dumbledore should not sign his name in the report
C No
55Case Study [2]
答案：A
考点：Standard V(A) Diligence and Reasonable Basis
解析：分析报告公开前Embiid报告中关客观
事实部分发象公司CEO审核整份报告（尤
含推荐级报告）发CEO选A分析报告
分析充分勤勉义务算Dumbledore意报告推
荐级报告签字B错C错
56Case Study [2]
3 Does Embiid’s statements to Conley most likely violate the CFA
Institute Standards of Professional Conduct
A Yes because of his statement about increasing amount of
investment in Novartis Gleevy
B Yes because of his forecast about the stock price
C No
57Case Study [2]
答案：A
考点：Standard III(C) Suitability Standard V(B) Communication
with Clients and Prospective Clients
解析：Embiid强调未股价翻倍观点
事实没违反准 B错题目信息中知
Conley保守投资者身格列宁员工
幅提高公司股票疑风险(尤达80
配)安然事件中许安然员工身家公
司股票安然事件发生导致终破产终收益
样资产配置适合ConleyC错选A
58Case Study [2]
4 With regard to the Conley’s request for the new report is there
any violation of the CFA Institute Standard of Practice and
Professional Conduct
A No
B Yes regarding the fee structure only
C Yes because he doesn’t disclose the fee structure to his
supervisor
59Case Study [2]
答案：C
考点：Standard IV(A) Loyalty
解析：里需注意题讨客户提供费结构
评级机构证券分析师说预测准确客户愿意
付钱天义种费结构没违反准
费结构必须级汇报杜绝种现象：
客户钱分析师私顾客户忽略
客户选C
60Case Study [2]
5 Does Embiid violate Standard VII Responsibilities as a CFA
Institute Member
A Yes because of his talks about LOS command words
B Yes because of his talks about weightings in the practice exam
C No
61Case Study [2]
答案：C
考点：Standard VII(A) Conduct as Participants in CFA Institute
Programs
解析：EmbiidSimmons讨关考试公开信息
没违反条准关LOS command word相关信息
协会网站公开载机密信息关科
目中权重协会官网找样机密信息
讨官方practice exam中权重真题
果两讨关三级考试午题真题容违反
准七
62Case Study [2]
6 When Simmons leaves Hogwarts is there any violation of the
CFA Institute Standard of Practice and Professional Conduct
A Yes regarding the client list only
B Yes regarding the recreation the BSM model only
C Yes regarding both the client list and the BSM model
63Case Study [2]
答案：A
考点：Standard IV(A) Loyalty
解析：员工离职时学知识技术外什
带走题干中强调Simmons仅带走客户名单
违反职业道德选A外Simmons重新构建模型
没违反准首先BSM模型公知识非某公司专
知识产权Simmons基原公司文件（已编
程序EXCEL VBA文档）构建模型没违规
64Case Study [2]
65Case Study [2]
Daryl Morey a CFA charterholder and former portfolio manager of
Celtic Securities is recently hired by Rocket Financial Servicer as a
compliance officer Rocket Financial Servicer is a small regional
asset management firm providing wealth management services
mainly to highnetworth individuals
66Case Study [2]
Morey’s first task in Rocket is to revise the firm’s compliance policy
and establish an appropriate incentive structure for research
activities After reviewing current related documents Morey is
astonished to find that Rocket’s compliance policies and
procedures haven’t changed since the firm’s inception In order to
deal with the inspection from SEC next month Morey copies the
whole documents of compliance policy in Celtic Securities with
only a few modifications He plans to establish a new system of
compliance policies to reflect any regulatory changes over the past
years after SEC’s inspection
67Case Study [2]
One month after the SEC’s inspection Morey sets up new
regulations on the incentive structure for research activities
Specifically Morey drafts the following policy statements
Statement 1 Employees must disclose all conflicts of interest to
their employer and current clients
Statement 2 Employees should never differentiate their services to
clients
Statement 3 Disclose all compensation arrangements
68Case Study [2]
Morey also checks Rocket’s criteria of selecting brokers He finds
that Rocket changes its broker every year and it seems that there is
no consistent standard of picking proper broker for the company
So he recommends that the selection of brokers should be based
on the following three standards
Standard 1 the broker’s ability to offer different kinds of strategy
meeting for Rocket’s investors
Standard 2 the broker’s ability to offer financial data terminals like
Bloomberg or Thomson Reuters
Standard 3 the broker’s ability to seek the best execution
69Case Study [2]
Chris Harden a star research analyst who has been working for
Rocket over ten years is in charge of writing analysis reports about
TMT industry Harden usually keeps his reports of
recommendations for six years However Morey has found that CFA
Institute recommends maintaining records for at least seven years
while local legal statutes only require five years Harden has a habit
of going to nightclub every Sunday and having numerous drinks
Back at work the next day he is always intoxicated when he makes
investment recommendations However the accuracy rate of his
recommendations is far above average
70Case Study [2]
When reviewing client investment record Morey discovers that
some transactions for clients are slower than Harden’s personal
account Harden argues that he has sent the investment
recommendations to all clients He didn’t trade until the moment
he pressed the send button Morey verbally criticizes Harden and
tells him to give clients more time to respond next time
71Case Study [2]
In order to improve clients’ confidence level for company’s
research team Morey puts an advertisement on its official website
which says Each member of our research team is Expert CFA and
all of them passed each level of the CFA exam on their first attempt
which implies our research team is more professional
72Case Study [2]
1 About his actions related to his first task Morey least likely
violates the CFA Institute Standards of Professional Conduct
concerning which of the following
A Loyalty to employer
B Responsibilities of Supervisors
C Preservation of Confidentiality
73Case Study [2]
答案：C
考点：Standard III(E) Preservation of Confidentiality Standard IV(A)
Loyalty Standard IV(C) Responsibilities of Supervisors
解析：Morey前雇Celtic Securities文档直接拷贝
仅做修改作新雇合规制度违反雇忠
诚员工离开公司时公司学知识技外
文件带走A错作监者Morey应付
SEC检查匆忙建立完善合规制度必须时反映
关监法规新求B错Preservation of Confidentiality
指客户机密信息保密雇关选C
74Case Study [2]
2 Which of Morey’s policy statements about regulations on the
incentive structure for research activities least likely violates the
CFA Institute Standards of Professional Conduct
A Statement 1 and statement 3
B Statement 2 and statement 3
C Only statement 3
75Case Study [2]
答案：C
考点：Standard VI(A) Disclosure of Conflicts Standard III(B) Fair
Dealing
解析：conflicts of interest披露雇客户够
潜客户（Prospective client）披露潜客户宣传公
司产品时披露利益突否显然骗A错作
提供服务公司然客户提供类服务
（更服务收费更已）B错
76Case Study [2]
3 Which standard with regard to selecting a proper broker is most
likely consistent with Standard III(A) Loyalty Prudence and Care
A Standard 1
B Standard 2
C Standard 3
77Case Study [2]
答案：C
考点：Standard III(A) Loyalty Prudence and Care
解析：选择broker时注意提供软美元（soft dollars）
定客户公司外选
取broker定够寻求best pricebest execute
选CAB均错A求broker客户提供参加策略会议
机会B求broker够提供诸彭博路透类金融数终
端然客户提供定客户群体需
求判断soft dollar否满足客户需求时注意找关键词
best pricebest execute
78Case Study [2]
4 Which of Harden’s activities most likely violate the CFA Institute
Standards of Professional Conduct His activities with regard to
A keeping his reports of recommendations for six years
B going to nightclub every Sunday
C Both of the above actions
79Case Study [2]
答案：B
考点：Standard IV(D) Misconduct Standard V(C) Record Retention
解析：CFA道德求适法规CFA准突时遵
更严格规定里情况较特殊CFA准中明确指
出果没相关法规CFA准建议记录保存七年
果法规规定遵法规（题中
法规求五年）A错Harden投资推荐准确率
高般水然违反相关准（渎职）
夜店喝醉行直接影响第二天工作（文中指出喝
酒第二天班明显酒精中毒）较高推荐准确率
免责（喝酒准确率更高纯属运气） 80Case Study [2]
5 With regard to transactions for clients does either Morey or
Harden violate CFA Institute Standards of Professional Conduct
A Yes Harden violates VI(B) Priority of Transactions
B Yes Morey violates Standard IV(C) Responsibilities of
Supervisors
C Both of the above
81Case Study [2]
答案：C
考点：Standard VI(B) Priority of Transactions Standard IV(C)
Responsibilities of Supervisors
解析：Harden违反fair dealing然Harden发客户研
究报告交易然行必须足客户阅读报告
根报告交易时间（点击邮件发送钮交易显然没
足客户时间）Morey违反监者职责仅仅口头批
评Harden告知例够必须章程次行
予相应惩罚
82Case Study [2]
6 Which of the following statements in the advertisement least
likely violates the CFA Institute Standards of Professional Conduct
A Each member of our research team are Expert CFA
B All members of the team have passed the exams on the first try
C Our research team is more professional
83Case Study [2]
答案：B
考点：VII(B) Reference to CFA Institute the CFA Designation and
CFA Program
解析：意引协会认关CFA称号文中
Expert CFAA错文字暗示表明拥CFA头
衔意味着力更强业绩更C错仅仅陈述成员
次性通CFA考试没违法准仅仅陈
述事实选B
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