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Ethical and Professional Standards Q90

0. XYZ, an investment firm, manages pension plans of various large companies. XYZ mainly uses Greatson, Inc. for most of its trading activity. This is because the CEOs of the two companies are close friends. Greatson is more expensive than the other brokerage firms offering the same brokerage services. Its research and execution are average compared to the other brokerage firms. But Greatson absorbs XYZ‟s rent in exchange for the brokerage business given to it by XYZ. Has XYZ violated any CFA Institute Standards of Professional Conduct?

  • Option : A
  • Explanation : Refer to Standard III(A) Loyalty, Prudence and Care.
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