To demonstrate his conviction and convince his hedge fund partners of the opportunity, Corrales immediately invests 25% of his personal portfolio in NI in return for shares. After several days of deliberation, the hedge fund partners decide to invest HFI assets in NI. Corrales this action can be view as to avoid principal agent conflict.
He has done this investment to help them to convince not as a front runner.
Did Corrales’s investment for his own portfolio most likely violate the CFA Institute Code and Standards?
- No
- Yes, with regard to conflicts of interest
- Yes, with regard to priority of transactions