Study Session 1

Reading 1 – Ethics and Trust in the Investment Profession

– LOS 1a: explain ethics

– LOS 1b: describe the role of a code of ethics in defining a profession

– LOS 1c: describe professions and how they establish trust;

– LOS 1d: describe the need for high ethical standards in the investment industry

– LOS 1e: explain professionalism in investment management;

– LOS 1f: identify challenges to ethical behavior

– LOS 1g: distinguish between ethical and legal standards

– LOS 1h: describe and apply a framework for ethical decision-making

Reading 2 – Code of Ethics and Standards of Professional Conduct

– LOS 2a: describe the structure of the CFA Institute Professional Conduct Program and the process for the enforcement of the Code and Standards

– LOS 2b: state the six components of the Code of Ethics and the seven Standards of Professional Conduct

– LOS 2c: explain the ethical responsibilities required by the Code and Standards, including the sub-sections of each Standard

Reading 3 – Guidance for Standards I-VII

Standard I – Professionalism

Standard II – Integrity of Capital Markets

Standard III – Duties to Clients and Prospective Clients

Standard IV – Duties to Employers

Standard V – Investment Analysis, Recommendations, and Action

Standard VI – Conflicts of Interest

Standard VII – Responsibilities as a CFA Institute Member or CFA Candidate

– LOS 3a: demonstrate the application of the Code of Ethics and Standards of Professional Conduct to situations involving issues of professional integrity

– LOS 3b: distinguish between conduct that conforms to the Code and Standards and Conduct that violates the Code and Standards

– LOS 3c: recommend practices and procedures designed to prevent violations of the Code of Ethics and Standards of Professional Conduct

Reading 4 – Introduction to

the Global Investment Performance Standards (GIPS)

– LOS 4a: explain why the GIPS standards were created, what parties the GIPS standards apply to, and who is served by the standards

– LOS 4b: explain the construction and purpose of composites in performance reporting

– LOS 4c: explain the requirements for verification

Reading 5 – The GIPS Standards

– LOS 5a: describe the key features of the GIPS standards and the fundamentals of compliance

– LOS 5b: describe the scope of the GIPS standards with respect to an investment firm’s definition and historical performance record

– LOS 5c: explain how the GIPS standards are implemented in countries with existing standards for performance reporting and describe the appropriate response when the GIPS standards and local regulations conflict

– LOS 5d: describe the nine major sections of the GIPS standards