CIC Ethics & Professional Standards

Question 1

What is the purpose of a code of ethics in investment counseling?

Accepted Answer

To uphold professional integrity

Answer

To promote dishonest practices.

Answer

To reduce transparency.

Answer

To ignore client interests.

Question 2

What is fiduciary duty?

Accepted Answer

Acting in client's best interest

Answer

Acting in self-interest.

Answer

Ignoring client goals.

Answer

Minimizing communication.

Question 3

Which principle emphasizes transparency with clients?

Accepted Answer

Disclosure

Answer

Confidentiality.

Answer

Indifference.

Answer

Negligence.

Question 4

What should an investment counselor avoid to maintain ethics?

Accepted Answer

Conflicts of interest

Answer

Client confidentiality.

Answer

Fair dealing.

Answer

Transparency.

Question 5

What is the consequence of unethical behavior in investment counseling?

Accepted Answer

Loss of trust and penalties

Answer

Increased profits.

Answer

More clients.

Answer

Faster decisions.

Question 6

Which organization sets professional standards for investment counselors?

Accepted Answer

CFA Institute

Answer

SEC.

Answer

FBI.

Answer

IRS.

Question 7

What is the principle of confidentiality?

Accepted Answer

Protecting client information

Answer

Sharing client data freely.

Answer

Ignoring client requests.

Answer

Disclosing client plans.

Question 8

How should investment counselors handle conflicts of interest?

Accepted Answer

Disclose and manage conflicts

Answer

Ignore conflicts.

Answer

Exploit conflicts.

Answer

Hide conflicts.

Question 9

Why is continuing education important for professionals?

Accepted Answer

To stay current with industry standards

Answer

To avoid learning new info.

Answer

To increase risk.

Answer

To confuse clients.