Explanation:
Statement 2 only - Under Standard III(D) Performance Presentation:
Statement 1 is NOT consistent: Terminated accounts cannot be excluded from performance history unless they are excluded for legitimate reasons (such as being non-discretionary or not representative). Simply excluding terminated accounts because they performed poorly would be misleading and violate the Standard.
Statement 2 IS consistent: Presenting performance using a weighted composite of similar portfolios is acceptable and actually encouraged under the GIPS standards. Composites help provide a more representative picture of performance for similar investment strategies or mandates.
Therefore, only Statement 2 is consistent with the performance presentation standards.
Ultimate access to all questions.
Which of the statements is consistent with the Standard relating to performance presentation?
A
Statement 1 only
B
Statement 2 only
C
both Statement 1 and Statement 2
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