Question

Which of the following securities, if purchased by an investment adviser for its own account but not for its client accounts at the same time, is a "red flag" indicator of a potential conflict of interest violation?A. The IA buys index funds for its own account

B. The IA buys Treasury Bonds for its own account
C. The IA buys an Initial Public Offering for its own account
D. The IA buys a money market fund for its own account

Answer 1

C. The IA buys an Initial Public Offering for its own account

Step-by-step explanation:

Which of the following securities, if purchased by an investment adviser for its own account but not for its client accounts at the same time, is a "red flag" indicator of a potential conflict of interest violation

Especially since IPOs will increase in price soon after issued

,the IA buys an Initial Public Offering for its own account.