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CFA Level 1 Exam

3959 Questions

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Question No. 1

Felix Asterix is a shrewd industry analyst working for Obelix, Inc., a brokerage firm of some repute. Asterix had

invested about $50,000 in a few stocks trading on the Australian exchange a year ago. Obelix itself is not
active outside the US and Asterix's transactions do not represent any violations of the company policies. One
of the Australian firms whose shares Asterix holds recently applied for a dual listing on the NYSE and will begin
trading in the US in a month. Asterix has advised in his recent research reports that investors would be well-off
investing in this dual-listed stock. He does not reveal his holdings in the Australian stock. Felix has:
I. not violated the AIMR standard since his transactions took place long before the dual listing and he is not
obligated to reveal his personal holdings.
II. violated Standard III (C) - Disclosure of Conflicts to Employer.
III. violated Standard IV (A.3) - Independence and Objectivity.
IV. violated Standard IV (B.7) - Disclosure of Conflicts to Clients and Prospects.
Choose the correct option from the given list.
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