Hi CFA Aspirants, welcome to AKVTutorials. Are you preparing for CFA Level 1, 2, 3 exams for making a career in CFA (Charted Financial Analyst). According to CFA Wikipedia, CFA The Chartered Financial Analyst (CFA) program is a postgraduate professional certification offered internationally by the American-based CFA Institute. A candidate who successfully completes the program and meets other professional requirements is awarded the “CFA charter” and becomes a “CFA charter holder”. Therefore, you need CFA Study Notes and CFA Sample Exam Test 9 Questions for Level 1 Answer Keys AMBIPi.
In this article, you will get Free CFA Level 1 Mock Exam Practice Questions.
Free CFA Level 1 Mock Practice Exam Questions Bank
Free CFA Level 1 Practice Question No: 281:
Standard __________ states that the financial analyst must use particular care to maintain independence and objectivity in relationships with issuers of securities.
Option A: I (B.2).
Option B: III (B. 1).
Option C: IV (A.3).
Option D: II (C.4).
Option E: None of these answers.
Show/Hide Answer
Option C : IV (A.3).
Standard IV (A.3) – Independence and Objectivity – ensures that clients have the benefit of work and opinions unaffected by any potential conflict of interest that may adversely affect their judgment. Members should maintain their independence by being wary of “perks” offered by external sources such as corporations, issuers, underwriters and brokers.
CFA Level 1 Exam Question No: 282:
Data Droid manages several investment accounts and directs most of the client transactions through Lore’s brokerage firm. Lore provides him with excellent, reliable research, though his commissions are higher than industry standards. The research is used to manage all the client accounts. Data has just been approached by the Troy brokerage firm, which is a newcomer in the business. While this firm does not provide any research, it charges commissions that are significantly lower than those charged by Lore. If Data decides to stay with Lore’s brokerage firm
Option A: has not violated the code since he has a long-standing relationship with Lore.
Option B: he has violated the code of ethics, which requires him to keep the expenses to a minimum.
Option C: has not violated the code if Lore’s research justifies the additional expenses
Option D: has violated the code by violating the Prudent Man Rule.
Show/Hide Answer
Option C : has not violated the code if Lore’s research justifies the additional expenses
Standard IV (B. 1) – Fiduciary Duties.
Free CFA Level 1 Mock Exam Question No: 283:
Standard IV (A.3) relates to two major components and is titled and _________ Objectivity.
Option A: None of these answers.
Option B: Impartiality.
Option C: Justice.
Option D: Autonomy.
Option E: Independence.
Show/Hide Answer
Option E : Independence.
Standard IV (A.3) – Independence and Objectivity, states that members shall use reasonable care and judgment to achieve and maintain independence and objectivity in making investment recommendations or taking investment action.
CFA Level 1 Free Practice Question No: 284:
Standard III (A) is __________.
Option A: Duty to Employer.
Option B: Disclosure of Conflicts to Employer.
Option C: Obligation to Inform Employer of Code and Standards.
Option D: Disclosure of Additional Compensation Arrangements.
Option E: None of these answers.
Option F: Responsibilities of Supervisors.
Show/Hide Answer
Option C : Disclosure of Additional Compensation Arrangements.
Standard III (A) deals with the Obligation to Inform Employer of Code and Standards. Standard III (B) deals with the Duty to Employer. Standard III (C) deals with Disclosure of Conflicts to Employer. Standard III (D) deals with Disclosure of Additional Compensation Arrangements. Standard III (E) deals with Responsibilities of Supervisors.
Free CFA Practice Question No: 285:
Performance (relating to Performance Presentation Standards) the record of the _______.
Option A: person.
Option B: Investment manager.
Option C: individual.
Option D: child.
Option E: Firm.
Show/Hide Answer
Option E : Firm.
To be in compliance with the PPS, a firm’s presentation of performance must comply on a firmwide basis and must consist of 10 years of performance (or records since the date of inception if the firm is younger than 10 years).
CFA Level 1 Sample Question No: 286:
Which of the following can be found in Standard IV?
Option A: Members shall maintain knowledge of and comply with all applicable laws
Option B: Members shall make reasonable efforts to achieve public dissemination of material nonpublic information disclosed in breach of a duty.
Option C: Members shall maintain appropriate records to support the reasonableness of recommendations.
Option D: Members shall not undertake any independent practice in competition with employer without written consent.
Option E: Members shall not participate in plagiarism.
Show/Hide Answer
Option C : Members shall maintain appropriate records to support the reasonableness of recommendations.
Standard IV states: “Members shall maintain appropriate records to support the reasonableness of recommendations or actions.’
Free CFA Level 1 Quiz Question NO: 287:
Carve-outs may not be combined with _________ portfolios.
Option A: new.
Option B: exchanged.
Option C: stand-alone.
Option D: composite.
Option E: benchmark.
Show/Hide Answer
Option C : stand-alone.
Stand-alone composites from subsectors* or carve-outs of larger, international portfolios can be created only if the subsectors are actually being managed as separate entities with their own cash allocations and currency management – for example, a series of currency funds.
Free CFA Level 1 Quiz Question NO: 288:
Liliana works for Bear Funds, a brokerage firm. Bear has a policy of not allowing its employees to trade in securities in which it has large holdings. A list of such securities is circulated on a daily basis to the employees. Liliana knows of this restriction. However, a few days ago, she happened to purchase a few shares of a firm that are on Bear’s restricted list. The total value of the purchase was less than $500. Liliana should
Option A: none of these answers.
Option B: report the transaction to the compliance department and see how best to unwind the transaction.
Option C: inform her immediate supervisor about it and accept any sanctions.
Option D: not do anything, because the activity is of negligible size.
Show/Hide Answer
Option B : report the transaction to the compliance department and see how best to unwind the transaction.
Standard III (C) – Disclosure of Conflicts to Employer.
Free CFA Practice Question No: 289:
Which of the following can be found in Standard V?
Option A: Members shall make reasonable and diligent efforts to avoid any material misrepresentation in any research report or investment recommendation.
Option B: Members shall maintain knowledge of AIM’s Code of Ethics.
Option C: If members receive material nonpublic information in confidence, they shall not breach that confidence by trading or causing others to trade in securities to which such information relates.
Option D: Members must use the CFA designation in a dignified manner.
Option E: Members shall comply with any prohibitions on activities imposed by their employer if a conflict of interest exists.
Show/Hide Answer
Option C : If members receive material nonpublic information in confidence, they shall not breach that confidence by trading or causing others to trade in securities to which such information relates.
Standard V details: “Prohibition against use of material nonpublic information. If members receive material nonpublic information in confidence, they shall not breach that confidence by trading or causing others to trade in securities to which such information relates.
CFA Mock Exam Free Question No: 290:
Arvantis works for Quick-time Brokerage. He has not been happy with his employment for some time and recently decided to start his own hedge fund. He started making administrative preparations for setting up the fund while still working for Quick-time Brokerage. He also made contact with a few of his oldest clients and gave them details about his hedge fund. The clients promised to switch accounts once the fund was initiated. Arvantis has:
I. violated Standard III (B) – Duty to Employer by making preparations to enter a competitive business while still being employed with Quick-time Brokerage.
II. violated Standard III (B) – Duty to Employer by soliciting Quick-time Brokerage’s clients while still being employed with Quick-time Brokerage.
III. not violated Standard III (B) – Duty to Employer.
Option A: I only.
Option B: II only.
Option C: I and II.
Option D: III only.
Show/Hide Answer
Option B : II only.
Standard III (B) – Duty to Employer – does not preclude a departing employee from making arrangements to enter independent practice prior to leaving current employment, as long as such preparations do not constitute a breach of loyalty toward the employer. However, undertaking any activity that harms the current employer is a violation of III (B).
