Suitability Recommendation for Retiree Client

Very Easy Cfa Institute Code And Standards Duties - Suitability

As a financial advisor, you are tasked with recommending investment products to your clients. One of your clients, Mrs. Smith, is a 75-year-old retiree with a conservative investment profile, seeking to preserve her capital and receive stable income. You are aware that a new high-risk growth fund has recently become popular among younger investors.

According to the CFA Institute Code of Ethics and Standards of Professional Conduct, which of the following scenarios would be the most suitable recommendation for you to make to Mrs. Smith?

Recommend the high-risk growth fund to Mrs. Smith because it has a potential for high returns.

Suggest a balanced fund that provides some growth potential while also focusing on capital preservation.

Advise Mrs. Smith to keep her cash in an interest-bearing savings account only.

Hint

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