CFA Level 1
Practice Test

Under the CFA Institute Code of Ethics, members are required to act with which quality toward clients, employers, and the public?

An analyst learns that a new securities regulation in her country is less strict than the relevant CFA Institute Standard. Which must she follow?

Which act most clearly violates Standard I(D) Misconduct?

A portfolio manager overhears, in an airport, two executives of a public company discussing an unannounced, material merger. The information is material and nonpublic. Under Standard II(A), the manager should:

Entering and quickly cancelling large orders to create a false impression of demand and move a stock's price is best described as a violation of:

Standard III(A) requires that when a member has discretionary authority over a client account, the member must place:

To comply with Standard III(B) Fair Dealing when disseminating a new investment recommendation, a firm should:

Before making a recommendation to a client with an investment policy statement, Standard III(C) Suitability requires a member to ensure the investment is consistent with the client's:

Standard III(D) Performance Presentation requires that communications about investment performance be:

Under Standard III(E) Preservation of Confidentiality, a member may disclose confidential client information when:

An analyst plans to leave her firm to start a competing business. Before resigning, Standard IV(A) Loyalty prohibits her from:

A client offers a portfolio manager a luxury vacation if the portfolio beats its benchmark. Under Standard IV(B), the manager must:

Standard IV(C) Responsibilities of Supervisors requires that a member with supervisory authority:

Standard V(A) Diligence and Reasonable Basis requires that recommendations and actions be supported by:

Under Standard V(B) Communication with Clients, a member must distinguish between:

Standard V(C) Record Retention requires members to maintain records that support their:

Standard VI(A) Disclosure of Conflicts requires a member who owns a large personal stake in a stock he recommends to:

Standard VI(B) Priority of Transactions requires that investment transactions for clients and employers take priority over:

Under Standard VI(C) Referral Fees, a member who receives a fee for referring clients to a service provider must:

A CFA candidate shares specific essay questions she recalls from the exam on an online forum. This violates:

Which statement about the CFA designation complies with Standard VII(B)?

The Global Investment Performance Standards (GIPS) are best described as:

To claim GIPS compliance, a firm must:

An analyst is invited on an issuer-paid trip with lavish entertainment to tour a company before writing a report. To best preserve independence under Standard I(B), the analyst should:

Brokerage commissions paid from client accounts (client brokerage) should be used by a manager to benefit primarily:

In allocating shares of a hot, oversubscribed IPO among suitable clients, a member best complies with Standard III(B) by:

Copying a third-party research report's analysis and presenting it as one's own without attribution violates the prohibition on:

An employee discovers her employer is engaged in ongoing illegal activity that harms clients. Acting against the employer's instructions to disclose this to authorities is:

According to the CFA Institute Code of Ethics, members and candidates are required to:

An analyst works in a country where insider trading is not illegal. Under the CFA Institute Standards of Professional Conduct, the analyst should: