Explanation:
According to the GARP Code of Conduct, investment professionals have an obligation to communicate clearly with clients about the basis for investment decisions. When making portfolio changes based on professional opinions rather than established facts, practitioners must:
Option B is incorrect because the GARP Code doesn't require identical treatment for all clients - investment decisions should be appropriate for each client's specific circumstances and risk tolerance.
Option C is incorrect because filing with the SEC is not required for routine portfolio allocation changes based on market opinions.
The key principle here is transparency and disclosure - clients have the right to understand the basis for investment decisions affecting their portfolios.
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Bob Hatfield has his own money management firm with two clients. The accounts of the two clients are equal in value. It is Hatfield's opinion that interest rates will fall in the near future. Based upon this, Hatfield begins increasing the bond allocation of each portfolio. In order to comply with Best Practices in the GARP Code of Conduct, the analyst needs to:
A
Inform the clients of the change and tell them it is based upon an opinion and not a fact.
B
Make sure that the change is identical for both clients.
C
File a report with the SEC of the new portfolio allocation.