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NEW QUESTION: 1
Martha Gillis, CFA, trades currencies for Trent, LLC. Trent is one of the largest investment firms in the world, and its foreign currency department trades more currency on a daily basis than any other firm. Gillis specializes in currencies of emerging nations.
Gillis received an invitation from the new Finance Minister of Binaria, one of the emerging nations included in Gillis's portfolio. The minister has proposed a number of fiscal reforms that he hopes will help support Binaria's weakening currency. He is asking currency specialists from several of the largest foreign exchange banks to visit Binaria for a conference on the planned reforms. Because of its remote location, Binaria will pay all travel expenses of the attendees, as well as lodging in government-owned facilities in the capital city. As a further inducement, attendees will also receive small bags of uncut emeralds (as emeralds are a principal export of Binaria), with an estimated market value of $500.
Gillis has approximately 25 clients that she deals with regularly, most of whom are large financial institutions interested in trading currencies. One of the services Gillis provides to these clients is a weekly summary of important trends in the emerging market currencies she follows. Gillis talks to local government officials and reads research reports prepared by local analysts, which are paid for by Trent.
These inputs, along with Gillis's interpretation, form the basis of most of Gillis's weekly reports.
Gillis decided to attend the conference in Binaria. In anticipation of a favorable reception for the proposed reforms, Gillis purchased a long Binaria currency position in her personal account before leaving on the trip. After hearing the finance minister's proposals in person, however, she decides that the reforms are poorly timed and likely to cause the currency to depreciate. She issues a negative recommendation upon her return. Before issuing the recommendation, she liquidates the long position in her personal account but does not take a short position.
Gillis's supervisor, Steve Howlett, CFA, has been reviewing Gillis's personal trading. Howlett has not seen any details of the Binaria currency trade but has found two other instances in the past year where he believes Gillis has violated Trent's written policies regarding trading in personal accounts.
One of the currency trading strategies employed by Trent is based on interest rate parity. Trent monitors spot exchange rates, forward rates, and short-term government interest rates. On the rare occasions when the forward rates do not accurately reflect the interest differential between two countries, Trent places trades to take advantage of the riskless arbitrage opportunity. Because Trent is such a large player in the exchange markets, its transactions costs are very low, and Trent is often able to take advantage of mispricings that are too small for others to capitalize on. In describing these trading opportunities to clients, Trent suggests that "clients willing to participate in this type of arbitrage strategy are guaranteed riskless profits until the market pricing returns to equilibrium." Based on the information given, and according to CFA Institute Standards, which of the following statements best describes Trent's compliance procedures relating to personal trading in foreign currencies? The compliance procedures:
A. appear adequate since Howlett was able to identify potential violations.
B. appear adequate, but Howlett's monitoring of Gillis's trades indicates poor supervisory responsibility.
C. should include both duplicate confirmations of transactions and preclearance procedures for personal trades.
Answer: C
Explanation:
Explanation/Reference:
Explanation:
Standard VI(B). The main problem in this case appears to be that there is no system to identify potential front-running violations before they occur. Standard VI(B) Conflicts of Interest - Priority of Transactions, recommends both preclearance of trades and duplicate trade confirmations as procedures for compliance.
(Study Session 1, LOS 2.a)
NEW QUESTION: 2
You company has an Azure subscription named Sub1. Sub1 contains an Azure web app named WebApp1 that uses Azure Application Insights. WebApp1 requires users to authenticate by using OAuth 2.0 client secrets.
Developers at the company plan to create a multi-step web test app that preforms synthetic transactions emulating user traffic to Web App1.
You need to ensure that web tests can run unattended.
What should you do first?
A. Upload the .webtest file to Application Insights.
B. Add a plug-in to the web test app.
C. In Microsoft Visual Studio, modify the .webtest file.
D. Register the web test app in Azure AD.
Answer: A
Explanation:
Explanation
https://docs.microsoft.com/en-us/azure/azure-monitor/app/availability-multistep
NEW QUESTION: 3
A backup administrator has enabled encryption on a Dell EMC Data Domain system. They are currently trying to change the encryption passphrase What is a consideration when changing the encryption passphrase?
A. Encryption must be disabled to change the passphrase
B. Passphrase can be only changed from the command line
C. File system must be disabled before changing the passphrase
D. User with Admin role is sufficient to change the passphrase
Answer: D
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