Skip to content

CFA Level I · CFA Level I Exam · Guidance for Standard V: Investment Analysis, Recommendations, and Actions

An analyst wants to base a recommendation on a third-party report. Which of the following is most likely a criterion the analyst may use to judge whether the research is sound?

The date and timeliness of the research is a listed criterion. The Standard's criteria include assumptions used, rigor of analysis, timeliness, and objectivity and independence. Popularity among subscribers or marketing spending does not show the research is sound.

  1. AThe number of firms that subscribe to the report
  2. BThe date and timeliness of the researchCorrect
  3. CThe size of the research firm's marketing budget

Explanation

The Standard lists assumptions used, rigor of the analysis, date/timeliness, and objectivity and independence of the recommendations as criteria. Subscriber count and marketing budget say nothing about soundness of the research itself.

Did you get it right without looking?

One question tells you little. A timed set on Guidance for Standard V: Investment Analysis, Recommendations, and Actions shows your real accuracy, how long you take and where you lose marks.

Practise Guidance for Standard V: Investment Analysis, Recommendations, and ActionsFree diagnostic mock

More Guidance for Standard V: Investment Analysis, Recommendations, and Actions questions