Lesson 4 of 9 · All lessons in this module
  1. Standard III(A)–(B): Loyalty, Prudence, Care and Fair DealingVideo lesson
  2. Standard III(A) cases: client identity, loyalty and brokerage
  3. Standard III(B) cases: dissemination, allocation and priority
  4. Standard III(C)–(E): Suitability, Performance Presentation and ConfidentialityVideo lesson
  5. Standard III(C) cases: IPS, total portfolio and mandates
  6. Standard III(D) cases: fair, accurate and complete performance
  7. Standard III(E) cases: exceptions, channels and firm limits
  8. Standard III(E) cases: vulnerable investors and cooperation
  9. Standard III(A) and (C) cases: ESG constraints and updated wording

This lesson is part of the 2027 curriculum. You are following the 2026 curriculum, where it is not taught in this form. Switch if you are sitting the exam under the 2027 curriculum.

Lesson 4 of 9 · 15 min

Standard III(C)–(E): Suitability, Performance Presentation and Confidentiality

Know the client before you advise, present performance fairly and completely, and keep what clients tell you to yourself.

In short

  • III(C) Suitability: in an advisory relationship, ask about the client's experience, risk and return objectives and constraints before acting, update regularly, and judge each investment within the total portfolio.
  • When managing to a mandate, invest only in line with the stated strategy; the fund manager is not responsible for suitability for each fund investor.
  • Unsolicited trades that are unsuitable: discuss first; minor ones can proceed with the client's acknowledgment, material ones call for an IPS update.
  • III(D) Performance Presentation: performance information must be fair, accurate and complete. GIPS compliance is the best way to meet it.
  • III(E) Preservation of Confidentiality: keep current, former and prospective client information confidential unless it concerns the client's illegal activity, law requires disclosure, or the client permits it.

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