Quote Originally Posted by george22 View Post
When an investment manager’s client instructs the manager to use the client’s brokerage to purchase goods or services for the client, this is known as;

A. Horizontal brokerage and does not violate any fiduciary duty
B. Directed brokerage and does not violate any fiduciary duty
C. Straight brokerage and does not violate any fiduciary duty

Answer: B

Explanation
It is known as directed brokerage and does not violate any fiduciary duty, because brokerage is an asset of the client and the brokerage is used to benefit that client, not the manager, such practice does not violate fiduciary duty.

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Thanks George. Will you post more CFA Level 1 practice questions here?