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Exam CFA® Level 1 All Questions

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Exam CFA® Level 1 topic 1 question 73 discussion

Actual exam question from Test Prep's CFA® Level 1
Question #: 73
Topic #: 1
[All CFA® Level 1 Questions]

A critical part of Standard IV (A.2) is to distinguish between:

  • A. research reports and investment memoranda.
  • B. insider trading and appropriate trading.
  • C. CFA charterholders and non-CFA charterholders.
  • D. none of these answers.
  • E. employees and independent contractors.
  • F. industry and company analysis.
  • G. the buy side and the sell side.
  • H. facts and opinions. H
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Suggested Answer: Explanation 🗳️
Standard IV (A.2) - Research Reports states the responsibility of AIMR members, CFA charterholders and candidates to include in each research report those key facts that are instrumental to the investment recommendation presented in the report. A critical part of this requirement is to distinguish clearly between opinions and facts.

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KAla7223
1 year, 11 months ago
H. factual information and investment recommendations. This distinction is important because the presentation of information should not be misleading or overly biased towards a particular investment decision. Factual information should be presented objectively and accurately, while investment recommendations should be based on thorough research and analysis and should include a clear and concise explanation of the reasoning behind the recommendation. Additionally, any conflicts of interest or other factors that may influence the investment recommendation should also be disclosed to the client.
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