medium · CFA Level I ethics

Westfork Bancorp manages a retirement fund. James, the manager, uses soft dollars from the fund's trades to pay for a subscription to a global macro economic data service. James uses this data to manage the retirement fund as well as three other unrelated institutional accounts at the bank. This practice is: Permissible under Standard III(A) as long as the data service provides a material benefit to the investment process of the retirement fund. A violation because soft dollars may only benefit the specific account that generated the commissions. Permissible only if the retirement fund receives a fee discount proportional to the use of the data by the other three accounts.

1. Permissible only if the retirement fund receives a fee discount proportional to the use of the data by the other three accounts.
2. A violation because soft dollars may only benefit the specific account that generated the commissions.
3. Permissible under Standard III(A) as long as the data service provides a material benefit to the investment process of the retirement fund.

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