2. Edward, CFA, heads the settlement department of a fund management company. His wife, Fiona, works for an investment bank. Edward accidentally overhears an acquisition deal that Fiona is working on. The deal is soon to be closed and announced publicly. Edward checks subsequently neither the stock of the target company nor its call option falls in the restricted list of his employer. To maximize the upside, he buys the call option but he loses money on it because it coincides with the market plunge due to rising interest rate. A) Please discussion the following: Which CFA Standard of Professional Conduct does the case relate to? [3 marks] B) Explain whether each of I, II, III & IV below is correct or incorrect separately with respect to the relevant Standard. State the key points of the case that relate to the relevant Standard in your own words. Edward's purchase of the call option is: I. acceptable because he is just working in the settlement department, but not the investment department, of the fund management company. II. acceptable because he is not making money on the trade. [4 marks] [1 mark] III. acceptable because he is only buying the call option of the target stock, not the stock itself. IV. unacceptable. [1 mark] [1 mark]