Course Content
ETHICS AND TRUST IN THE INVESTMENT PROFESSION
This chapter is covered in Reading 1 of the Study Session 1, of the study material prescribed by the institute. After reading this chapter a student should be able to: a explain ethics; b describe the role of a code of ethics in defining a profession; c describe professions and how they establish trust; d describe the need for high ethical standards in investment management; e explain professionalism in investment management; f identify challenges to ethical behavior; g distinguish between ethical and legal standards; h describe a framework for ethical decision making.
0/7
LOS A: Explain Ethics
00:00
LOS B: Ethics and Professionalism
00:00
LOS C: How Professions Establish Trust
00:00
LOS D and E: Professionalism in Investment Management
00:00
LOS F: Challenges to Ethical Conduct
00:00
LOS G: Ethical and Legal Standards
00:00
LOS H: Framework for Ethical Decision Making
00:00
CODE OF ETHICS AND STANDARDS OF PROFESSIONAL CONDUCT
This chapter is covered in Reading 2 of the Study Session 1, of the study material prescribed by the institute. After reading this chapter a student should be able to: a. describe the structure of the CFA Institute Professional Conduct Program and the process for the enforcement of the Code and Standards; b. state the six components of the Code of Ethics and the seven Standards of Professional Conduct; c. explain the ethical responsibilities required by the Code and Standards, including the sub-sections of each Standard.
0/3
LOS A: Professional Conduct Program
00:00
LOS B: Code of Ethics
00:00
LOS C: Code and Standards
00:00
GUIDANCE FOR STANDARDS I–VII
This chapter is covered in Reading 3 of the Study Session 1, of the study material prescribed by the institute. After reading this chapter a student should be able to: a. demonstrate the application of the Code of Ethics and Standards of Professional Conduct to situations involving issues of professional integrity; b. distinguish between conduct that conforms to the Code and Standards and conduct that violates the Code and Standards; c. recommend practices and procedures designed to prevent violations of the Code of Ethics and Standards of Professional Conduct.
0/7
Professionalism – First standard of Professional Conduct
00:00
Integrity of Capital Markets – Second Standard of Professional Conduct
00:00
Duties to Clients – Third Standard of Professional Conduct
00:00
Duties to Employer – Fourth Standard of Professional Conduct
00:00
Investment Analysis, Recommendations, & Actions
00:00
Conflict of Interest
00:00
Responsibility as a CFA Institute Member or CFA Candidate
00:00
INTRODUCTION TO THE GLOBAL INVESTMENT PERFORMANCE STANDARDS (GIPS)
This chapter is covered in Reading 4 of the Study Session 1, of the study material prescribed by the institute. After reading this chapter a student should be able to: a. a explain why the GIPS standards were created, what parties the GIPS standards apply to, and who is served by the standards; b. explain the construction and purpose of composites in performance reporting; c. explain the requirements for verification.
0/5
Why Were GIPS Standards Created?
00:00
Who Can Claim Compliance?
00:00
Who Benefits from Compliance?
00:00
Composites
00:00
Verification
00:00
GLOBAL INVESTMENT PERFORMANCE STANDARDS (GIPS)
This chapter is covered in Reading 5 of the Study Session 1, of the study material prescribed by the institute. After reading this chapter a student should be able to: a. describe the key features of the GIPS standards and the fundamentals of compliance; b. describe the scope of the GIPS standards with respect to an investment firm’s definition and historical performance record; c. explain how the GIPS standards are implemented in countries with existing standards for performance reporting and describe the appropriate response when the GIPS standards and local regulations conflict; d. describe the nine major sections of the GIPS standards.
0/7
Objectives of GIPS
00:00
Overview of GIPS Standards
00:00
Compliance with GIPS
00:00
Recommendations
00:00
Scope of GIPS Standards
00:00
Implementation
00:00
Major Section of GIPS Standards
00:00
Ethical and Professional Standards
About Lesson

There are seven standards of professional conduct required to be maintained by the members. They are:

1.   Professionalism: This standard requires that each of the members must have:

     a.  the knowledge of the law,

     b.  independence and objectivity,

     c.  should avoid misrepresentation, and

     d.  avoid any sort of misconduct.

2.  The integrity of capital market: The members and candidates can maintain the integrity of the capital market by:

     a.  protecting the material non-public information and not letting it affect the decisions of others; and

     b.  do not involve in the act of market manipulation.

3.  Duties to clients: The professionals have the following duties towards the clients:

     a.  Loyalty and Prudence

     b.  Fair Dealing

     c.  Suitability

     d.  Performance Presentation

     e.  Preservation of Confidentiality

4.  Duties to Employers: The professionals have the following duties towards the employers:

     a.  Loyalty

     b.  Additional Compensation Arrangements

     c.  Responsibility of Supervisors

5.  Investment Analysis, Recommendations, and Actions: It requires the professionals to:

     a.  Exercise diligence while making recommendations and have a reasonable basis for that decision

     b.  Communicate what is necessary to the current as well as the prospective clients

     c.  Retain the records based on judgment

6.  Conflict of Interests: In case of any conflict of interest, the professionals need to make the:

     a.  Disclosure of such conflicts

     b.  Priority of transactions

     c.  Referral fees

7.  The responsibility of CFA Members and Candidates: The professionals are responsible for:

     a.  Their conduct as members or candidates in the CFA program

     b.  Should no exaggerate or misrepresent their reference to the CFA Institute, the CFA designation, and the CFA program

(NOTE: These standards are discussed in details in the next chapter)

 

Previous
Next