Sovereign Wealth Funds (SWF)

Sovereign Wealth Funds had grown in importance due to its size and closed link to government.

Some resources on SWF:

SWF Institute
website

A good resource on SWF. There are website links to various SWFs, fund rankings, statistics & research.

Some of the important parameters for SWFs are size, SWF-to-foreign-exchange-reserve ratio and transparency. The transparency index for SWF is called Linaburg-Maduell Transparency Index. We can find these parameters of SWFs from fund rankings.

Singapore’s SWFs are GIC and Temasek Holding (Temasek itself claims that it is not a SWF).
Malaysia’s SWF is Khazanah.

International Working Group (IWG) of Sovereign Wealth Funds (SWF) has published a set of 24 voluntary principles to ensure an open international investment environment.

Generally Accepted Principles and Practices (GAPP)for SWF (called Santiago Principles)
pdf file

SWF Radar:
website
We can look for updated SWF news here.

Ethics on financial/investment field (2) - CFA Institute Standards of Professional Conduct

Both CFA Institute and CAIA are using CFA Institute Standards of Professional Conduct.

Let’s explore what is inside.

The portion more related to clients/customers are Professionalism; Duties to clients;
Investment analysis, recommendations and actions; Conflicts of interest.

For details, refer to the following files:
Code of Ethics and Standards of Professional Conduct

Standard of Practice Handbook
(we can find many Guidances, Recommended Procedures, Applications etc.)

CFA Institute Standards of Professional Conduct:
1. Professionalism
a. knowledge of the law
b. independence and objectivity
c. misrepresentation
d. misconduct

2. Integrity of capital markets
a. material nonpublic information
b. market manipulation

3. Duties to clients
a. loyalty, prudence and care
b. fair dealing
c. suitability
d. performance presentation
e. preservation of confidentiality

4. Duties to employers
a. loyalty
b. additional compensation arrangement
c. responsibilities of supervisors

5. Investment analysis, recommendations and actions
a. diligence and reasonable basis
b. communication with clients and prospecting clients
c. record retention

6. Conflicts of interest
a. disclosure of conflicts
b. priority of transactions
c. referral fees

7. Responsibilities as a CFA Institute member or CFA candidate
a. conduct as members and candidates in the CFA program
b. reference to CFA Institute, the CFA designation and the CFA program

Ethics on financial/investment field (1)

Ethics are very important in financial/investment professionals, especiallly to those that are advising customers/investors directly. Whenever there are financial scandals, questions related to ethics will be asked, especially by investors that are "victimised".

What are the ethics relevant to financial/investment professionals ?
Are ethics incorporated into curriculums ?
Are there laws/regulations governing ethics of financial/investment professionals ?
Can they be sued ? Can we recover the losses ?
… the list goes on…

Many of the questions are too big for me. Let’s explore..

Let’s take a look whether Ethics materials are included in curriculum of financial/investment professionals and what the aspects of Ethics are.

I look for the curriculum of financial/investment professionals from websites mentioned in my previous post.

CFP’s curriculum:
Code of Ethics and Professional Responsibility and Disciplinary Rules and Procedures,
Financial Planning Practice Standards,
Disciplinary Rules and Procedures.

CFA Institute’s curriculum:
Code of Ethics and Standards of Professional Conduct,
"Guidance" for Standards I-VII

CAIA’s curriculum:
CAIA is using CFA Institute Standards of Professional Conduct

FRM’s curriculum:
couldn’t find material on ethics from its website.
Maybe because risk management is more of technical work and involves less direct dealings with customers/investors.

Financial Times presentation on financial crisis

Financial Times’ website has few interactive presentation showing timeline of financial institutions affected in The Financial Crisis and governments’ intervention.

Bank Street:
link
I think this is creative ! It shows someone walking through Bank Street, showing sequences of financial institutions having problems and their outcomes.

Governments’ intervention:
link

We can actually select types of governments’ intervention:
liquidity and lending guarantees,
interest rate moves,
bank deposit guarantees,
bank recapitalisation
asset purchase,
short selling crackdown.

Cool !