Chapter 10 Flashcards
Forces changing the securities industry have impacted the industries, ethical climate in which of the following ways
A. Clients have developed unreasonable levels of ethical standards.
B. The trend of increase price competition has made building long-term relationships more difficult.
C. Clients and their investment professionals have inherent conflict of interest.
D. Closer supervision of investments professionals is the result of the creation of large national brokerage firms.
B. The trend of increase price competition has made building long-term relationships more difficult.
Which of the following is a source of ethical conflict in the securities industry
A. Offering ‘ index’ mutual funds
B. Unrealistic expectations of the client.
C. Performance advertisements in the media.
D. Industry competition.
B. Unrealistic expectations of the client.
A potential client Ross Walker is contacted by a Taylor investment professional Ross is interested in trading complex options and is willing to open an account if Amy is knowledgeable about options, Amie implies to Ross that she is an expert in trading. In fact, she only knows the basics solely looking at Amie‘s lack of competency in this area which fiduciary duty has not been met in this instance?
A. Duty to disclose.
B. Duty to keep current.
C. Duty to consult.
D. Duty of care.
D. Duty of care
The suitability rule is one of the key aspects of which one of these.
A. FINRA conduct rules.
B. Securities act of 1933.
C. Investment company act of 1940
D. Securities exchange act of 1934.
A. FINRA conduct rules.
In the asset management process ‘knowing your customer’ falls under the step of
A. Establishing goals.
B. Analyzing information.
C. Gathering data.
D. Implementation.
C. Gathering Data
