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The following information assumes that the CFA Institute Code of Ethics and Standards are applicable...

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Accounting

The following information assumes that the CFA Institute Code of Ethics and Standards are applicable

  1. Ethics play an important part in the business-world, and this is particularly true for the investment industry. You may often be placed in situations where you must make decisions where you face conflicting interests. Recommend, and explain, a decision-making framework that may guide you towards making an ethical decision.
  2. ABC recommends the purchase of a mutual fund that invests solely in long-term US Treasury bonds. She makes the following statements to her clients:
  3. The payment of the bonds is guaranteed by the US government; therefore, the default risk of the bonds is virtually zero.
  4. If you invest in the mutual fund, you will earn a 10% rate of return each year for the next several years based on historical performance of the market.

Did ABC's statements violate the CFA Institute Code and Standards? Explain Why/Why Not and which standard(s) are being considered.

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