Ethics and Professional standard-III(B)

A

Ankit Sharma

New member
Joined
Oct 22, 2015
Messages
0
Reaction score
0
Hi all,
I have confusion in one example , which is under Ethical standard II(B) example no. 6 , which goes like this
[Text removed by admin]
My question is how can gordon held responsible for violation of standard III(B)-Fair Dealing. The standard clearly says that :
Standard III(B) does not state “equally” because Each client has unique needs, investment criteria, and investment objectives, so not all investment opportunities are suitable for all clients. In addition, members and candidates may provide more personal, specialized, or in-depth service to clients who are willing to pay for premium services through higher management fees or higher levels of brokerage. Members and candidates may differentiate their services to clients, but different levels of service must not disadvantage or negatively affect clients.

If gordon is saying that she is going to tell only to mometum investment style, so that can be interpretrated that the particular stock or strategy is useful for that set of clients only. Please Correct me If I a wrong.

Thanks
 
Very interesting question.
In my opinion, selecting only clients who follow a momentum investment style Gordon has failed to inform other clients who could have benefited from the info (investors who want to diversify with latin american stocks but who do not follow momentum investment style).
 
As far as I understand, an analyst must disregard the investment style clients employ in their IPSs and inform all clients equally on any opportunities he/she thinks valuable. I saw there was a special case in QBank discribing the responsibilities of an analyst. On the other hand, an advisor is responsible to account the investment styles of his/her clients and may violate III(B) in case he/she advises the same security / trade idea to all clients.
 
By selectively diclosing to the monument investors about the earning revision, he violated the code. He is allowed to discuss at length about the change in earning projection but only after he has ensure public desemination of the information.
 
Hi Kotausi_77
so as per you If the question says that a the particular person is analyst ” he cant violate the standard III(B) ” but if he is a advisor he can do consider the investment style which was explain as a exception in the study material.
One more thing , If the company in which he work follows strict policy to inform the clients on any opportunity as per their investment style , Then whether the analyst and advisor both has violated the standard III(B) in which of the following 2 options:
A) The firm discloses this policy to all the clients
B) The firm does not discloses this policy to clients
Thanks in advance
 
You must log in or register to reply here.
Back
Top