Handling Personal Investments and Client Transparency

Easy Research Objectivity Standards Personal Investments

As a portfolio manager, you are subject to the Research Objectivity Standards outlined by the CFA Institute. You recently purchased shares in a technology company that you also cover in your professional research. After a recent earnings report, you publish a bullish research report on the company. Subsequently, some of your clients inquire about potential conflicts of interest arising from your personal investment in this company. What should your response be in terms of maintaining ethical standards?

You should disclose your personal investment to your clients to maintain transparency.

You should ignore the concerns raised by your clients, as your personal investments are irrelevant to your professional recommendations.

You should sell your shares in the company immediately to eliminate any perception of conflict of interest.

Hint

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