GIPS® and the Vignette Gauntlet: Ethics Season Finale
About this episode
The Ethics season ends with two halves. The first is an introduction to the Global Investment Performance Standards (GIPS®) at the conceptual level the Level 1 exam works at: why the standards exist, why compliance is voluntary, why composites have to include the accounts that did badly as well as the ones that did well, why only a firm can claim compliance and only for the whole firm, and why verification is optional and covers the firm's processes rather than any single performance number. In a two host format, one host explains the material while the other plays a fictional exam candidate. The second half is the gauntlet: 25 short, fully fictional vignettes drawn from all seven Standards of Professional Conduct, read at exam pace. Some are violations and some are the allowed version that a distractor dresses up as one, such as a mosaic built from public and non-material information, a lawful client instruction, or an analyst who holds her rating under pressure. The episode closes with a three-step habit for reading any Ethics vignette: identify the actor and the duty, find the gap, then check whether the situation is actually allowed.
In this episode
The first half introduces the Global Investment Performance Standards (GIPS®) at the conceptual level the Level 1 exam works at: why the standards exist, why compliance is voluntary, and why composites have to include the accounts that did badly as well as the ones that did well.
The hosts reason through who can claim compliance: only a firm can, and only for the whole firm, and why verification is optional and covers the firm's processes rather than any single performance number.
The second half is the gauntlet: 25 short, fully fictional vignettes drawn from all seven Standards of Professional Conduct, read at exam pace. Some are violations and some are the allowed version that a distractor dresses up as one, such as a mosaic built from public and non-material information, a lawful client instruction, or an analyst who holds her rating under pressure.
The vignettes are simplified for exam practice and are not compliance advice.
The episode closes with a three-step habit for reading any Ethics vignette: identify the actor and the duty, find the gap, then check whether the situation is actually allowed. It points listeners to the free 90 question practice exam at tottenprep.com.
What this episode covers
- Why the GIPS® standards exist and why compliance is voluntary.
- Composites: the accounts that did badly count as well as the ones that did well.
- Only a firm can claim compliance, and only for the whole firm; verification is optional and covers processes, not a single number.
- 25 short, fully fictional vignettes across all seven Standards, read at exam pace.
- The three-step habit: identify the actor and the duty, find the gap, check whether the situation is actually allowed.
Frequently asked questions
What are the GIPS® standards at the CFA® Level 1 level?
At the Level 1 exam's conceptual level, the Global Investment Performance Standards (GIPS®) exist so investors can compare performance presentations fairly. Compliance is voluntary, composites have to include the accounts that did badly as well as the ones that did well, only a firm can claim compliance and only for the whole firm, and verification is optional and covers the firm's processes rather than any single performance number.
What is the three-step habit for reading a CFA® Ethics vignette?
Identify the actor and the duty, find the gap, then check whether the situation is actually allowed. The episode closes the Ethics season by applying this habit to 25 short, fully fictional vignettes drawn from all seven Standards of Professional Conduct.