1. Example: A financial advisor should not pressure a client into investing in a particular stock or fund, but rather should present all options and let the client choose based on their own free will.
2. Example: Companies that are going public should provide all potential investors with the same information about their financials and performance, ensuring that everyone has equal access to important data before making investment decisions.
3. Example: A bank should not misrepresent the risks associated with a particular investment product to attract more customers, but instead should provide accurate and honest information to clients.
4. Example: A financial planner should help clients think logically and rationally about their investment decisions, rather than allowing them to make impulsive choices that could harm their financial security in the long run.
5. Example: Stock exchanges should ensure that all investors have access to the same trading platform and receive fair and equal treatment in terms of pricing and execution of their trades, without any unfair advantages given to certain individuals or groups.
Discuss any FIVE (5) best ethics should be performed by the financial person who works in conventional financial system. You need to give examples in explaining it.
1. Freedom from coercion
* Implies that all investors have the
right not to be coerced into a
transaction.
* A transaction is fair, if it is done
by free will of all parties to the
contract.
2. Right to equal information
* This right show that, all the investors
should have an equal right to know or
access to a particular set of information
* Parties, who have a specific set of value
and relevant information, should disclose
it to others.
* Example, at the time of declaration of IPO.
3. Freedom from misrepresentation
* Investors have a right to believe in
whatever information declare
voluntarily by a specialist (bankers)
and that’s why there are no
misrepresentation element should
exist.
4. Freedom from impulse
* This right entitles all investor to
protection from imperfect selfcontrol.
* This right is to ensure that an investor
is prevented from making any
mistakes which are harmful to his
own interest.
5. Right to trade at efficient price
* This right entitles all investors to trade
at price they perceive as efficient or
correct.
* The alternative is to let the prices
adjust by whatever amount necessary
by supply and demand of investor and
supported by regulator.
explain the answer using the points only with examples
1 answer