Lesson 31 of 34 · All lessons in this module
  1. Standard I: ProfessionalismVideo lesson
  2. Standard I cases: knowledge of the law and dissociation
  3. Standard I cases: pressure on analysts and performance staff
  4. Standard I cases: gifts, travel, manager selection and paid research
  5. Standard I cases: misrepresenting services, products and results
  6. Standard I cases: plagiarism, third-party material and online content
  7. Standard I cases: misconduct and competence
  8. Standard II: Integrity of Capital MarketsVideo lesson
  9. Standard II(A) cases: material, nonpublic or mosaic?
  10. Standard II(A) cases: tipping, experts and firm controls
  11. Standard II(B) cases: rumours, trades and intent
  12. Standard II cases: extra 2026 examples and procedures
  13. Standard III(A)–(B): Loyalty, Prudence, Care and Fair DealingVideo lesson
  14. Standard III(A) cases: client identity, loyalty and brokerage
  15. Standard III(B) cases: dissemination, allocation and priority
  16. Standard III(C)–(E): Suitability, Performance Presentation and ConfidentialityVideo lesson
  17. Standard III(C) cases: IPS, total portfolio and mandates
  18. Standard III(D) cases: fair, accurate and complete performance
  19. Standard III(E) cases: exceptions, channels and firm limits
  20. Standard IV: Duties to EmployersVideo lesson
  21. Standard IV(A) cases: loyalty, outside work and leaving
  22. Standard IV(B) and IV(C) cases: outside pay and supervision
  23. Standard V: Investment Analysis, Recommendations, and ActionsVideo lesson
  24. Standard V(A) cases: reasonable basis and outside research
  25. Standard V(A) cases: models, advisers and providers
  26. Standard V(B) cases: services, costs and process changes
  27. Standard V(B) cases: risks, limitations, facts and opinions
  28. Standard V(C) cases: records and retention
  29. Standard VI: Conflicts of InterestVideo lesson
  30. Standard VI(A) cases: avoiding and disclosing conflicts
  31. Standard VI(B) and VI(C) cases: who trades first and who gets paid
  32. Standard VII: Responsibilities as a CFA Institute Member or CFA CandidateVideo lesson
  33. Standard VII(A) cases: exams, confidentiality and volunteering
  34. Standard VII(B) cases: using the designation, membership and candidacy

Lesson 31 of 34 · 15 min

Standard VI(B) and VI(C) cases: who trades first and who gets paid

Clients first, employer second, yourself last; personal trades must neither disadvantage clients nor use their information, and any payment or benefit for a recommendation, in either direction, must be disclosed before the client signs.

In short

  • VI(B) order: client transactions, then employer, then personal accounts in which you are a beneficial owner. Personal trades come only after clients and employer have had adequate opportunity to act.
  • Personal investing is not wrong in itself: the client is not disadvantaged, you do not profit from trades made for clients, and rules are followed. The same tests govern a sale against the firm's view.
  • Beneficial ownership reaches family accounts and accounts where you have a financial interest. A family member's client account is treated like any other: neither favoured nor disadvantaged.
  • Procedures: limit IPOs and private placements, blackout periods, preclearance, holdings reports at hire and at least annually, duplicate confirmations and meaningful disclosure of the policy.
  • VI(C): disclose to employer, clients and prospects any compensation or benefit paid or received for referrals, including services, commissions and internal bonuses, with its nature and estimated value, before the agreement.

Unlock this lesson free for 7 days

Create a free account to get 7 days free: every lesson, video and flashcard, and the question bank. No card needed.

Start your 7-day free trialLog in