I attempted the CFA Institute Code and Standards Self-Test today.
These are the questions that I got wrong:
Question 2 of 49
Danaher heads the research department of a large brokerage firm. The firm has many analysts, some of whom are subject to the Code and Standards. Which statement best describes Danaher’s ability to delegate her supervisory responsibilities under the Code and Standards?
Danaher would retain supervisory responsibility for all subordinates despite her delegation of some duties.
Danaher would no longer have responsibility for those duties delegated to her subordinates.
Danaher cannot delegate supervisory responsibility to those subordinates who are not subject to the Code and Standards.
The Code and Standards prevent Danaher from delegating supervisory duties to subordinates.
Question 5 of 49
Which of the following actions is LEAST LIKELY to be a violation of the Code and Standards:
Cheating on the CFA Examination.
Posting derogatory comments regarding the CFA Program on a website for CFA candidates.
Misrepresenting information on the CFA Institute annual Professional Conduct Statement.
Misrepresenting information when applying for Professional Development credit.
Question 19 of 49
Gaines, a financial analyst for Skinner Investment Counseling, is told by the investor relations representative for Firebird Avionics, a major aircraft parts manufacturer, that the firm is in the final stages of building a new fuel efficient jet engine. This information is divulged by Firebird at the most recent quarterly conference call for analysts. Gaines uses this information along with other information he obtained from the company and distributed to the public in a research report that includes a “buy” recommendation for Firebird stock. Which of the following statements is CORRECT:
Gaines violated the Code and Standards because he failed to separate opinion from fact.
Gaines violated the Code and Standards because he has a material misrepresentation in his report.
Gaines violated the Code and Standards because he used material nonpublic information.
Gaines’ actions did not violate the Code and Standards.
Question 32 of 49
Which one of the following scenarios is MOST LIKELY to be a violation of the Code and Standards:
Personal bankruptcy.
A conviction for drunk driving.
A conviction for possession of drugs.
Submitting false expense reimbursement forms.
Question 37 of 49
Which of the following statements regarding research reports is/are CORRECT according to the Standards of Practice Handbook?
I. Members should outline known limitations of their analysis.
II. Reports should be supported by background and supporting information, and this information should be available to interested parties.
III. Members must include all relevant factors in research reports.
I, II, and III.
I and II.
II and III.
I and III.
Question 38 of 49
Which of the following is LEAST LIKELY to assist a Member in meeting their obligations with regard to presenting investment performance under the Code and Standards:
Presenting the performance of a new investment strategy by applying the strategy to historical performance data.
Presenting the performance of the weighted composite of similar portfolios.
Making disclosures that explain the performance results being reported.
Complying with the Global Investment Performance Standards (GIPS).
Question 47 of 49
Sheramy, a portfolio manager for Woodbridge Investment handles the account of Zamborino, a client of the firm. Zamborino offers to pay Sheramy a $100,000 bonus over and above her compensation from Woodbridge Investments if Sheramy achieves an 18 percent annual return for Zamborino’s account. Sheramy:
Cannot accept this offer because it is outside of her primary employment relationship with Woodbridge Investments.
Can accept this offer as long as she discloses the arrangement to her employer.
Cannot accept this offer because it will interfere with her independence and ability to be objective regarding investment decisions and recommendations.
Can accept this offer and disclose the bonus to her employer only if she actually achieves the performance target and receives the gift.
I’d really appreciate if you guys could help to point out the right answers and ,if you could, some explanation.
Thank you.
These are the questions that I got wrong:
Question 2 of 49
Danaher heads the research department of a large brokerage firm. The firm has many analysts, some of whom are subject to the Code and Standards. Which statement best describes Danaher’s ability to delegate her supervisory responsibilities under the Code and Standards?
Danaher would retain supervisory responsibility for all subordinates despite her delegation of some duties.
Danaher would no longer have responsibility for those duties delegated to her subordinates.
Danaher cannot delegate supervisory responsibility to those subordinates who are not subject to the Code and Standards.
The Code and Standards prevent Danaher from delegating supervisory duties to subordinates.
Question 5 of 49
Which of the following actions is LEAST LIKELY to be a violation of the Code and Standards:
Cheating on the CFA Examination.
Posting derogatory comments regarding the CFA Program on a website for CFA candidates.
Misrepresenting information on the CFA Institute annual Professional Conduct Statement.
Misrepresenting information when applying for Professional Development credit.
Question 19 of 49
Gaines, a financial analyst for Skinner Investment Counseling, is told by the investor relations representative for Firebird Avionics, a major aircraft parts manufacturer, that the firm is in the final stages of building a new fuel efficient jet engine. This information is divulged by Firebird at the most recent quarterly conference call for analysts. Gaines uses this information along with other information he obtained from the company and distributed to the public in a research report that includes a “buy” recommendation for Firebird stock. Which of the following statements is CORRECT:
Gaines violated the Code and Standards because he failed to separate opinion from fact.
Gaines violated the Code and Standards because he has a material misrepresentation in his report.
Gaines violated the Code and Standards because he used material nonpublic information.
Gaines’ actions did not violate the Code and Standards.
Question 32 of 49
Which one of the following scenarios is MOST LIKELY to be a violation of the Code and Standards:
Personal bankruptcy.
A conviction for drunk driving.
A conviction for possession of drugs.
Submitting false expense reimbursement forms.
Question 37 of 49
Which of the following statements regarding research reports is/are CORRECT according to the Standards of Practice Handbook?
I. Members should outline known limitations of their analysis.
II. Reports should be supported by background and supporting information, and this information should be available to interested parties.
III. Members must include all relevant factors in research reports.
I, II, and III.
I and II.
II and III.
I and III.
Question 38 of 49
Which of the following is LEAST LIKELY to assist a Member in meeting their obligations with regard to presenting investment performance under the Code and Standards:
Presenting the performance of a new investment strategy by applying the strategy to historical performance data.
Presenting the performance of the weighted composite of similar portfolios.
Making disclosures that explain the performance results being reported.
Complying with the Global Investment Performance Standards (GIPS).
Question 47 of 49
Sheramy, a portfolio manager for Woodbridge Investment handles the account of Zamborino, a client of the firm. Zamborino offers to pay Sheramy a $100,000 bonus over and above her compensation from Woodbridge Investments if Sheramy achieves an 18 percent annual return for Zamborino’s account. Sheramy:
Cannot accept this offer because it is outside of her primary employment relationship with Woodbridge Investments.
Can accept this offer as long as she discloses the arrangement to her employer.
Cannot accept this offer because it will interfere with her independence and ability to be objective regarding investment decisions and recommendations.
Can accept this offer and disclose the bonus to her employer only if she actually achieves the performance target and receives the gift.
I’d really appreciate if you guys could help to point out the right answers and ,if you could, some explanation.
Thank you.