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CFA Level I · CFA Level I Exam · Guidance for Standard III: Duties to Clients

Lindqvist joins Harbor Asset Management after five years at a prior firm, where he managed a large-cap equity fund. Harbor wants to include his prior record in its advertising. Consistent with Standard III(D), the advertisement should most appropriately:

The advertisement should disclose where the performance was earned and Lindqvist's specific role in achieving it. Standard III(D) permits using a prior firm's record with full disclosure of its source, but presenting it as the new firm's own performance would be a material misrepresentation.

  1. Aomit the record, because performance from a prior firm may never be shown
  2. Bdisclose where the performance was earned and Lindqvist's specific role in achieving itCorrect
  3. Cpresent the record as Harbor's own to show the firm's depth of talent

Explanation

Standard III(D) does not prohibit showing past performance from a prior firm if accompanied by appropriate disclosures about where the performance took place and the person's specific role. Presenting it as Harbor's own would misrepresent the firm's record.

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