question archive Lourdes Conti, CFA, is a portfolio manager at a global investment bank, which has an approved vendor for international equity research service
Lourdes Conti, CFA, is a portfolio manager at a global investment bank, which has an approved vendor for international equity research service
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Lourdes Conti, CFA, is a portfolio manager at a global investment bank, which has an approved vendor for international equity research service. Since Conti is looking at an investment in a country where the capital market is very unique in terms of structure and regulations, she has reason to question the validity of the research conducted by the approved vendor. Hence, she has done her own due diligence and found a local research firm that knows the market well. Did she violate Standard V (A) if she uses the approved vendor, instead of the local research firm?
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A) Yes, because she should not rely on the research when she has reasonable doubt in its validity.
B) No, because she needs to comply with the company policies.
C) No, because she should trust the due diligence done by the company on the approved vendor.
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Any professional should work in the best interest of it's client. The professional should conduct his/her own due diligence and stand by it. Here, Conti has doubt about the approved vendor and should not select him. Hence, the correct answer is-
A) Yes, because she should not rely on the research when she has reasonable doubt in its validity.
