QUESTIONS 1 THROUGH 18 RELATE TO ETHICAL AND PROFESSIONAL STANDARDS.

4. Diana Fairbanks, CFA is married to an auditor who is employed at a large accounting

firm. When her husband mentions a computer firm he audits will receive a qualified

opinion she thinks nothing of it. Later that week when she reviews a new client account

she notices there are substantial holdings of this computer firm. When she does a

thorough Internet search for news on the company, she does not find anything about its

most recent audit or any other adverse information. Which of the following actions

concerning the computer stock should Fairbanks most likely take to avoid violating the

CFA Institute Standards of Professional Conduct?

A. Take no investment action.

B. Complete a thorough and diligent analysis of the company and then sell the stock.

C. Sell the stock immediately as she has a reasonable basis for taking this investment

action.