Ethical Implications of Performance Reporting Practices

Medium Asset Manager Code Performance Reporting

As a portfolio manager at an investment firm, Jane is responsible for reporting the performance of her firm's funds to clients. In her latest report, she decides to include only periods where her fund outperformed the benchmark, omitting periods of underperformance to showcase superior results. This practice has raised concerns among her colleagues regarding compliance with the CFA Institute's Asset Manager Code, specifically concerning performance reporting.

Which of the following statements best describes the ethical implications of Jane's reporting practices?

Jane's approach is acceptable as long as she discloses the outperformance periods to the clients.

Jane's practice is unethical as it presents a misleading portrayal of performance and violates principles of fair representation.

Jane’s report is in compliance with ethical standards if she includes a disclaimer about her selective reporting.

Hint

Submitted12.0K

Correct8.7K

% Correct72%