Please answer Only PART 2

Q-1:

You acquire a new client, Nathan Jones. Nathan is 27 years old, single, and a lawyer with a major downtown law firm. He earns $70,000 before tax and has saved $30,000. Bob has been investing in equities for the past two years, and plans to use this money to start investing for retirement.

Nathan does not plan to retire until age 65. He is not concerned about his portfolio fluctuating, since he does not need the money at this time and his job is stable. Nathan reads the business section of the newspaper each morning, and has a good understanding of financial markets.

In a recent newspaper article, Nathan read about a new growth fund and its portfolio manager. He is interested in investing $5,000 in this fund.

Do you consider Bob to have a low, medium or high risk tolerance?

How would you advise Nathan with regard to making this investment: for or against? Why?

How would you rate his investment knowledge? Why?

Would this be an unsolicited trade or not? Why?

Q-2.

Tony, a dealing representative, runs an investment seminar. At the end of the presentation, one of the attendees, Jason Parker, shows Tony his current portfolio that is with a competitor, and complains about the return on his current batch of mutual funds.

Tony tells Jason that he would put him into better-performing top-quartile funds, and suggests that Jason transfer his account to Tonys supervision.

Is Tonys conduct ACCEPTABLE? Why or why not?