United States
Hong KongProfessional Conduct and Regulation: 8% and the easiest marks on the paper
Eight per cent of the exam, which is thirteen of the 170 questions on our derived counts. It covers CFP Board's Code of Ethics and Standards of Conduct, the fiduciary duty, the disciplinary process, and financial services regulation.
This is the best-value domain on the exam and almost nobody treats it that way.
Eight per cent of a 170-question paper, and unlike every other domain the source material is a single document you can read in an evening. There is no judgment required about which of four defensible answers is best - the Standards say what they say.
What is in it
- CFP Board's Code of Ethics - six commitments.
- The Standards of Conduct, in six parts, A through F.
- The fiduciary duty and precisely when it applies.
- The seven-step financial planning process, which is Part C.
- The disciplinary process and the sanctions available.
- Financial services regulation: the Investment Advisers Act, adviser registration, and consumer protection.
The structure of the Standards
| Part | Covers |
|---|---|
| A | Duties Owed to Clients - sixteen sections, including the fiduciary duty |
| B | Financial Planning and application of the Practice Standards |
| C | The Practice Standards for the Financial Planning Process - the seven steps |
| D | Duties Owed to Firms and Subordinates |
| E | Duties Owed to CFP Board |
| F | Prohibition on Circumvention |
Knowing which part a topic lives in is worth having. It tells you whose interest the duty protects, which is often what a question turns on.
Why candidates lose marks here
They revise it last, and they revise it from a summary.
Summaries of the Standards are everywhere and they smooth over exactly the distinctions being tested - when the fiduciary duty attaches, what counts as Financial Planning, which conflicts must be avoided rather than disclosed. Read the source.
Questions describe conduct that is legal, common and still a Standards violation. "Is this allowed?" is a different question from "would a regulator prosecute this?", and the exam is asking the first.
The regulation half
The Investment Advisers Act of 1940, the distinction between an investment adviser and a broker-dealer, state versus SEC registration, Form ADV, and the consumer protection and privacy rules.
This half is less examined than the Standards half and it is genuinely useful in practice, particularly for anyone thinking about their own registered investment adviser.
How to study it
Read the Code and Standards once, properly, from cfp.net. Two hours.
Then do practice questions and go back to the specific section for every miss. The document is short enough that this is a realistic study loop, which is not true of any other domain.
CFP® is a registered mark of Certified Financial Planner Board of Standards, Inc. We are not affiliated with, or endorsed by, CFP Board. Confirm any provision against the current Code and Standards at cfp.net before relying on it.
Common questions
How much of the CFP exam is professional conduct?
Eight per cent of the 170 questions, which works out at about thirteen items on our derived counts. CFP Board publishes the weighting rather than per-domain question numbers.
Why is this domain good value?
The source is one document you can read in an evening, and the answers are stated rather than requiring judgment between defensible alternatives. No other domain works that way.
What are the six parts of the Standards?
A - Duties Owed to Clients. B - Financial Planning and applying the Practice Standards. C - the seven-step process. D - Duties to Firms and Subordinates. E - Duties to CFP Board. F - Prohibition on Circumvention.
Why do candidates lose marks here?
They revise it last and from a summary. Summaries smooth over exactly the distinctions being tested, such as when the fiduciary duty attaches and which conflicts must be avoided rather than disclosed.
Is the regulation material heavily tested?
Less than the Standards. The Investment Advisers Act, adviser versus broker-dealer, registration thresholds and Form ADV are worth knowing but carry fewer questions than Parts A to F.