Ethical Dilemma in Reporting Investment Risks

As a financial analyst working for a large investment firm, you have been assigned to evaluate a new investment opportunity for your firm's portfolio. After thorough analysis, you discover that the investment has a dubious regulatory history, and some professionals in the industry have voiced concerns about its compliance with legal standards. You are eager to present this opportunity to your firm, as it appears to promise high returns and would contribute significantly to your performance metrics.

Your supervisor has encouraged you to focus on the potential gains and to downplay risks related to the investment. You are caught in a dilemma: whether to report the investment opportunity truthfully with all associated risks or to comply with your supervisor’s expectations.

Discuss how you would approach this ethical decision-making scenario in accordance with the CFA Code of Ethics and Standards of Professional Conduct, particularly focusing on maintaining professionalism.