A financial analyst receives some positive information from an investor relations representative of a manufacturing company...
A financial analyst receives some positive information from an investor relations representative of a manufacturing company at the most recent quarterly conference call. The analyst uses this information, along with other information he obtained from the company distributed to the public, in a research report that includes a "buy" recommendation for the company stock. Which of the following statements is true?
A) The analyst violated the CFA Institute Standards of Professional Conduct because he failed to separate opinion from fact.
B) The analyst violated the CFA Institute Standards of Professional Conduct because he used material inside information.
C) The analyst's actions did not violate the CFA Institute Standards of Professional Conduct.
Homework Answers
Option C is correct
The analyst's actions did not violate the CFA Institute Standards of Professional Conduct.
Here, the analyst used information that was publically available and the information that the analyst got from conference call is also a public information, so analyst didn't violate CFA Institute Standards of Professional Conduct.
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