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NEW QUESTION: 1
Susan Foley, CFA, is Chief Investment Officer of Federated Investment Management Co. (FIMCO), a large investment management firm that includes a family of mutual funds as well as individually managed accounts. The individually managed accounts include individuals, personal trusts, and employee benefit plans. In the past few months, Foley has encountered a couple of problems.
The Tasty IPO
Most portfolio managers of FIMCO have not participated in the initial public offering (IPO) market in recent years. However, recent changes to the compensation calculation at FIMCO have tied manager bonuses to portfolio performance. The changes were outlined in a letter that was sent out to clients and prospects shortly before the new bonus structure took effect. Carl Lee, CFA, is one portfolio manager who believes that investing in IPOs may add to his client's equity performance and, in turn, increase his bonus. While Lee's individual clients have done quite well this year, his employee benefit plans have suffered as a result of limited exposure to the strongest performing sector of the market. Lee has placed an order for all employee benefit plans to receive an allocation of the Tasty Doughnut IPO. Tasty is an over-subscribed IPO that Lee knew would make money for his clients. When he placed the order, Lee's assistant reminded him that one pension plan. Ultra Airlines, was explicitly prohibited from investing in IPOs in its investment policy statement, due to the under-funded status of the pension plan. Lee responded that the Tasty IPO would never actually be owned in Ultra's account, because he would sell the IPO stock before the end of the day and realize a profit before the position ever hit the books.
Another manager, Franz Mason, CFA, who manages accounts for about 150 individuals, is also interested in the Tasty IPO. Mason visits Lee's portfolio assistant and quizzes him about Lee's participation in the Tasty deal. Mason is sure that Lee would not have bought into Tasty unless he had done his homework.
Mason places an order for 10,000 shares of the IPO. Mason returns to his desk and begins to allocate the IPO shares among his clients. Mason divides his client base into two groups: clients who are income- oriented and clients who arc capital gains-oriented. Mason believes those clients that are income-oriented are fairly risk averse and could not replace lost capital if the Tasty Doughnut deal lost money. Mason believes the capital gains-oriented accounts arc better able to withstand the potential loss associated with the Tasty IPO. Accordingly, Mason allocates his 10,000 share order of the Tasty IPO strictly to his capital appreciation clients using a pro rata allocation based on the size of the assets under management in each account.
FIMCO Income Fund (FIF)
Over the past three years, the FIF, with $5 billion in assets, has been the company's best performing mutual fund. Jane Ryan, CFA, managed the FIF for seven years, but resigned one year ago to start her own hedge fund. Under Ryan, the FIF invested in large cap stocks with reliable dividends. The fund's prospectus specifies that FIF will invest only in stocks that have paid a dividend for at least two quarters, and have a market capitalization in excess of $2.5 billion. Foley appointed FIMCO's next best manager (based on 5-year performance numbers) Steve Parsons, CFA, to replace Ryan. Parsons had been a very successful manager of the FIMCO Opportunity Fund, which specialized in small capitalization stocks. Six months after Parsons took over the helm at FIF. the portfolio had changed. The average market capitalization of FIF's holdings was $12.8 billion, as opposed to $21 billion a year ago. Over the same period, the average dividend yield on the portfolio had fallen from 3.8% to 3.1%. The performance of the FIF lagged its peer group for the first time in three years. In response to the lagging performance, Parsons purchased five stocks six months ago. Parsons bought all five stocks, none of which paid a dividend at the time of purchase, in anticipation that each company was likely to initiate dividends in the near future. So far, four of the stocks have initiated dividend payments, and their performance has benefited as a result.
The fifth stock did not initiate a dividend, and Parsons sold the position last week. Largely due to the addition of the five new stocks, the FIF's performance has led its peer group over the past six months.
Before leaving FIMCO, Ryan had told Foley that above-average returns from both the management and client side could be gained from entering into the risk-arbitrage hedge fund market. Ryan had tried to convince FIMCO management to enter the risk-arbitrage market, but the firm determined that no one had the experience or research capability to run a risk-arbitrage operation. As a result, Ryan started the Plasma Fund LLC one month after leaving FIMCO. Foley remembers seeing Ryan at the annual FIMCO client dinner parly (before she left the firm) discussing the profits to be made from risk-arbitrage investing with several large FIF shareholders. Ryan mentioned that she would be opening the Plasma Fund to these FIMCO clients, several of whom made substantial investments in the first months of Plasma Fund's life.
After Ryan resigned and left her office, Foley performed an inventory of firm assets signed out to Ryan.
One of the copies of the proprietary stock selection software packages, FIMCO-SelectStock, assigned to Ryan was missing along with several of the SelectStock operating manuals. When Foley contacts Ryan about the missing software and manuals, Ryan states that the reason she took the SelectStock software was that it was an out of date version that FIMCO's information technology staff had urged all managers to discard.
Which of the following statements is most accurate with regard to Ryan's discussion of the new Plasma Fund with FIMCO clients?
A. Ryan is within the CFA Institute Standards because the Plasma Fund was only in the planning stages at the time of her discussion.
B. Ryan has violated CFA Institute Standard IV(A) - Duties to Employers - Loyalty. In the meeting with potential clients, even though FIMCO had no experience or research capability to enter the risk arbitrage market, Ryan is offering an asset management service that is directing funds away from FIMCO.
C. Ryan is within the CFA Institute Standards by discussing Plasma with the clients, since the product she was discussing did not compete with her present employer (FIMCO) in any way.
Answer: B
Explanation:
Explanation/Reference:
Explanation:
Standard IV(A). By soliciting potential clients while still being an employee of FIMCO, Ryan has violated Standard IV(A) Duties to Employers - Loyalty, which states (hat in matters related to their employment, members and candidates must act for the benefit of their employer and not deprive their employer of the advantage of their skills and abilities, divulge confidential information, or otherwise cause harm to their employer. The standard applies regardless of whether Ryan is on her own time. Even though FIMCO does not have a risk arbitrage product and FIMCO had actually decided against going into the risk arbitrage business, Ryan is offering a service (asset management) that is in competition with her employers business and will direct funds away from FIMCO. (Study Session 1, LOS 2.a)

NEW QUESTION: 2
A company monitors its account activity using AWS CloudTrail, and is concerned that some log files are being tampered with after the logs have been delivered to the account's Amazon S3 bucket.
Moving forward, how can the SysOps Administrator confirm that the log files have not been modified after being delivered to the S3 bucket.
A. Enable log file integrity validation and use digest files to verify the hash value of the log file.
B. Enable S3 server access logging to track requests made to the log bucket for security audits.
C. Replicate the S3 log bucket across regions, and encrypt log files with S3 managed keys.
D. Stream the CloudTrail logs to Amazon CloudWatch to store logs at a secondary location.
Answer: A

NEW QUESTION: 3
Which two options are advantages of an application layer firewall? (Choose two.)
A. provides high-performance filtering
B. supports a large number of applications
C. authenticates individuals
D. authenticates devices
E. makes DoS attacks difficult
Answer: C,E
Explanation:
http://www.cisco.com/en/US/prod/collateral/vpndevc/ps6032/ps6094/ps6120/prod_white_paper0900aecd8058ec85.html
Adding Intrusion Prevention
Gartner's definition of a next-generation firewall is one that combines firewall filtering and intrusion prevention systems (IPSs). Like firewalls, IPSs filter packets in real time. But instead of filtering based on user profiles and application policies, they scan for known malicious patterns in incoming code, called signatures. These signatures indicate the presence of malware, such as worms, Trojan horses, and spyware.
Malware can overwhelm server and network resources and cause denial of service (DoS) to internal employees, external Web users, or both. By filtering for known malicious signatures, IPSs add an extra layer of security to firewall capabilities; once the malware is detected by the IPS, the system will block it from the network.
Firewalls provide the first line of defense in any organization's network security infrastructure. They do so by matching corporate policies about users' network access rights to the connection information surrounding each access attempt. If the variables don't match, the firewall blocks the access connection. If the variables do match, the firewall allows the acceptable traffic to flow through the network.
In this way, the firewall forms the basic building block of an organization's network security architecture. It pays to use one with superior performance to maximize network uptime for business-critical operations. The reason is that the rapid addition of voice, video, and collaborative traffic to corporate networks is driving the need for firewall engines that operate at very high speeds and that also support application-level inspection. While standard Layer 2 and Layer 3 firewalls prevent unauthorized access to internal and external networks, firewalls
enhanced with application-level inspection examine, identify, and verify application types at Layer 7 to make sure unwanted or misbehaving application traffic doesn't join the network. With these capabilities, the firewall can enforce endpoint user registration and authentication and provide administrative control over the use of multimedia applications.

NEW QUESTION: 4
Which of the following are part of a typical SAP CRM service process?(Choose two)
A. Performing resource planning for a service order
B. Billing a service confirmation
C. Billing a service level agreement
D. Performing resource planning for a service confirmation
Answer: A,B

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