False advertising

I recently ventured into a bit of consumer activism and want to relate the experience – not to blow my own trumpet, but to encourage others to be more vigilant. I was looking at the webpage of a well-respected investment house in South Africa last year and read about their investment approach. Buried in this “investment philosophy” was the following sentence:

The word “pragmatic” refers to the Charles Peirce School of investment philosophy, which advocates taking a practical approach to matters with reference to historical events.

I found this rather interesting – I had never heard of the “Charles Peirce School” and I immediately googled it. Nothing. I could find not a single reference to any school, movement, or theory of investment associated with Charles Peirce. The man, Charles Peirce, however, did exist. He was a very influential philosopher, founder of a movement called “pragmatism”, which, as far as I could tell, had absolutely nothing to say about investments.

I sent the investment house an email querying their use of the term, asking they either provide a valid explanation of the term or remove it from their marketing material. Here is the full message I sent (square brackets included ex-post):

Dear Sir/Madam
I am hoping to get some clarification regarding ideas expressed on your website. 

On this [link removed] page describing your investment philosophy you use the following words "the Charles Peirce School of investment philosophy, which advocates taking a practical approach to matters with reference to historical events." 

Would you please clarify your justifications for using this particular terminology, providing supporting documentation. My own cursory search has revealed 

1. Charles Peirce was a philosopher, not an investment theorist
2. Though he found [sic] a school of philosophy called pragmatism this does not appear to have anything to do with investing and the use of the word pragmatism in this context is very specialised and not the same as the everyday use of the word
3. no evidence for a recognised school of thought termed the "Charles Peirce School of investment philosophy" and thus no evidence that they espouse "a practical approach to matters with reference to historical events" 

Please let me know if any of the above points are incorrect. For instance, if there are a group of investment practitioners or theorists that identify themselves as the Charles Peirce School, please point them out to me. 

If, however, my points are correct then you must either remove the reference to Charles Peirce or make it very clear that you are reinterpreting his ideas (this probably cannot be done without a publication with proper citations justifying this reinterpretation).

I received the following reply (which I have censored somewhat):

Thank you for your email. Our investment CIO and strategist have considered your questions and have the following response: 

You are correct in saying that Charles Peirce was a philosopher and not investment theorist and that there is no official Charles Peirce school of investment philosophy. 

The explanation on the website was intended to refer back to his philosophy to convey the fact that we apply pragmatism to investments.  So instead of applying the theory of value investing dogmatically [explanation removed] 

We plan to adjust the wording of the website copy to address your concerns and thank you for kindly taking the time to give us your feedback.

To the company’s credit, they did remove the reference to the Charles Peirce School and the current version is better. I should also make it clear that this investment company is well-respected for a reason. I think this was a glitch in their marketing machine, no more.

As such my little quest to remove just a few sentences from the company’s electronic marketing material may seem a little quaint – was there really any harm? I believe there was. Essentially, the reference to the Charles Peirce School was a lie. It created the false impression that the company was associated with some well-researched and respected group of investment theorists, whereas in fact this group did not exist. It would have been far wiser simply to explain the idea behind their investment philosophy (which is what they now do), rather than inventing fancy references to make their approach seem sophisticated.

The financial markets are extremely hard for consumers to grapple with. The environment is complex enough without companies trying to baffle consumers with misleading marketing. There is a large degree of mysticism in active investment – the investment manager is a kind of black box: money goes in, magic happens, huge returns come out. This is a false impression, especially as the work done by many fundamental managers is really just a combination of a simple philosophy, common sense and experience. We cannot allow consumers to be taken advantage of in this manner. The only way this will stop is if educated consumers take the time to respond to misleading practices where they find them.

[To avoid potential problems, I have decided not to mention the name of the investment house in this post. I am not, however, under the illusion that I have guaranteed their anonymity.]

Don't trust research, not even your own

The more research I do (and I have not done much) the less I trust other research, and the less I trust my own.  When you read a paper in finance you will invariably find significant results that support the author’s conclusions.  When I run regressions, my results are weak, sometimes contradicting my hypothesis sometimes confirming it.

Significance bias

Weak results don’t get published (and negative results, i.e. results that do not find evidence for an hypothesis don’t get published either).  Academics have an incentive to try things until they find something significant. Of course, they then only report the significant results. The problem is firstly that this is a form of data mining and secondly that there is information in the insignificant results that is now lost. Future researchers may well duplicate much of the work, not knowing it has already been tried.

The story bias

We like stories that fit together. In research (particularly research in finance) this can be problematic. At some point during your research (or beforehand) you will develop a theory, a kind of story puts all your results together like pieces of a puzzle. This will develop long before you have all your results. It’s a good thing to have a hypothesis before you start running tests on your data – it helps to avoid data mining. However, the danger is that as you look at your results, you discount the results that do not fit your story.  This may not even be conscious. It’s just the way your brain works.  The danger, then, is that you only report results that fit your story.  

As a researcher you are likely to have more results at your disposal than you can reasonably report in an article or thesis. You must condense, summarise, omit. More than that, you must give the appearance of a coherent structure, an evidence-based explanation of the underlying forces you have uncovered. You can’t just say, “well, it’s a bit of a mess.” Your story has to make sense. But sometimes the world is a mess and stories don’t work.

Self-examination

I wrote this post not because I found these tendencies in other researchers. I found their beginnings in myself. I have careful supervision that will prevent abuses. In theory peer review should uncover these things as well. In practice, I don’t trust the peer review system either. Thus this is a public reminder to myself: be wary of cherry-picking results to suit your prejudices.

When to give back the Bacon

My last two posts both were both very critical of ethics in the markets. Today I would like to give some praise. Louis Bacon, manager of a very large fund ($8Bn) of assets has decided to give back a quarter to investors. It is, in essence, admitting defeat. And that is something investment professionals seem to be very loathe to do.

Hedge funds do not like to give back money to investors, even when the investors themselves request it. More assets under management (AUM) means reduced management fees and less prestige. Giving back money also immediately says that you are unable to make money, that you are stumped, that the money is better invested elsewhere. Mr Bacon is giving up about $60m a year (but don’t praise him too much; he is worth over a billion. He is not giving up anything he cannot do without).

Mr Bacon, after recent poor returns, does admit that he just can’t make money in the current environment, not with such a large pool of assets. His fund seems to focus on macro-economic strategies, meaning it makes bets on macro-economic factors affecting countries as whole. Most notably, in this environment, that includes everything affecting the sovereign debt crisis. With all the government intervention and decisions by Ms Merkel (prime minister of Germany) and Mr Draghi (head of the European Central Bank) sending markets up and down, but with no decisive actions being taken, Mr Bacon feels he cannot make a bet on the market movements. He needs to bet something big will happen. And it just won’t happen. Probably Mr Bacon feels he cannot figure out what’s going to happen next, but he hasn’t gone quite as far as admitting that.

A large fund is not as agile as a smaller fund. With a smaller fund Mr Bacon will be able to take smaller positions that have a larger impact on the overall performance of the fund and be able to move in and out of positions more quickly. Hedge funds normally charge a performance fee – if the increase in performance is high enough it may offset the loss of the management fee mentioned earlier.

 Mr Bacon cares for his image. That is why he’d rather try to make a decent return on a smaller fund than poor returns on a larger fund. However, admitting his inability to profit from current market conditions is quite laudable for a man who made his fortune placing bets on other international events equally as murky. He also seems to take his responsibility as a custodian of other people’s money seriously. He cannot give the performance expected and so he has his investors put their money elsewhere. Unfortunately, for many, admitting the limits of their abilities does not seem to come as easily.

References 

• Chung, J. (2012). Louis Bacon to Return $2 Billion to Investors. Wall Street Journal. Retrieved August 3, 2012, from http://blogs.wsj.com/deals/2012/08/01/louis-bacon-to-return-2-billion-to-investors/ Herbst-Bayliss, S. (2012).
• Big hedge funds seen unlikely to diet after Bacon slims down. Reuters. Retrieved August 3, 2012, from http://www.reuters.com/article/2012/08/02/us-hedgefunds-idUSBRE8711VN20120802 Thomas Jr., L. (2012).
• Too Big to Profit, a Hedge Fund Plans to Get Smaller. Dealbook. Retrieved August 3, 2012, from http://dealbook.nytimes.com/2012/08/01/hedge-fund-titan-plans-to-return-2-billion-to-investors/

Li(e)bor

In my last post I lamented the apparently non-existent moral foundations of banks. I hardly thought the next scandal would be so soon after. Last month it transpired that Barclays had been manipulating the Libor rate. However, everybody else was doing it too, it seems. This is a betrayal of public trust egregious enough, in my opinion (and many others’), to warrant some jail sentences.

But everybody’s doing it

Bankers never seem to do anything alone. Everybody has to have their piece of the pie. No one is willing to stand out, even for the sake of such things as moral principles, ethics, right and wrong. After Barclays was fined a paltry amount it became clear that they were not the only ones involved. A large list of banks is now under investigation. Were they colluding? Probably, but not necessarily. I will discuss this further below. First, let us get a grip on what this mysterious Libor is.

What is the Libor?

Libor, actually LIBOR , is an acronym for London Interbank Offered Rate. It seems to be an interest rate. Actually, it is not, which is part of the problem. It should, however, in principle at least, be related to actual interest rates. The interest rates referred to are the rates banks charge each other when they lend money to each other. It is a common occurrence for a bank to lend money to another bank, for instance if the latter bank needs liquidity in the short term. The Libor is calculated more or less as follows. A number of banks (16, it seems) are asked to give an estimate of the rate at which they could borrow money from the inter-bank market. The top and bottom quarter of these estimates are thrown out and an average taken of the ones that remain. This is the Libor. The problem with the above process is that it is open to manipulation. It is subjective, which makes it easier (and more tempting) to lie. This, then is what Barclays did. What many banks did.

Why does it matter if Libor is wrong?

Libor might not be an actual interest rate, but many (very many) actual interest rates are based directly on Libor, from mortgage rates to rates on derivatives known as swaps. If Libor is low it means those with mortgages related to Libor pay lower amounts. They win. However, people invested in instruments that pay rates related to Libor lose out as they get less. These may not even out. The impact of a single basis point difference in Libor is a huge redistribution of wealth. Libor matters not only because of instruments it affects directly. It has become a global benchmark interest rate. It is taken into account in many decisions. It could affect many other rates charged, advice given, corporate actions taken. The Libor is also an indicator of the health of the banking system. When it is high, it indicates banks have little faith in the ability of their peers to repay their money. An artificially low Libor rate is, in effect, a collective denial of the fragility of the banking system. It is serious if such a globally significant figure is a lie.

Why try to manipulate Libor?

1. In order to look better. For a time Barclays’ submitted Libor figures were higher than the rest of the market. This, seemingly, indicated that Barclays was in relatively poor health. Lowering its Libor estimates alleviated these fears.
2. Because everybody else is doing it. Why were the other banks’ Libor estimates so low? Possibly because they were underreporting them. Barclays may not have been the first to do so. The more banks that underreport their Libor the more pressure there is on other banks to do the same in order not to seem weak. In addition, if everybody else is doing it, it is far easier to delude yourself into thinking it is acceptable. You can defend yourself by pointing fingers. 
3. Profit. Profit. Profit. Emails between those responsible for the submission of Libor and traders show agreements to attempt to manipulate Libor in order to favour the traders’ positions. For instance, suppose Barclays held a swap contract in which they agreed to pay a the Libor rate to another party and, in return, received a fixed rate¹. If the Libor rate falls, the bank’s position becomes more valuable as it is now paying out a smaller amount, but still receiving the same fixed amount.

What does it matter if Barclay’s Libor is wrong?

Barclays is only one bank. Does it really matter if its Libor submission is wrong? Well, yes and no. If Barclays submission is too high or too low it does not influence the calculated result at all. However, every bank’s submission influences every other banks’ submission. None of the banks would want to seem too weak compared to the others. This can lead to seemingly co-ordinated underreporting of Libor even if the banks are not colluding explicitly. This, however, is really only relevant for reasons 1 and 2 above. To profit from Libor rigging, Barclays would need to be able to move the rate on its own, unless it colluded with other banks which had similar positions.

Let us suppose Barclays’ estimate is not thrown out, so it is one of the eight estimates that do get averaged. What is the effect of Barclays’ estimate? Suppose the average of the other 7 banks is x and the Barclays estimate b (in per cent), then the average of all 8 is 7/8x + b/8. How much lower than the average of the other banks would Barclay’s estimate need to be in order to lower the Libor by 1 basis point, that is by 0.01? Solving a simple linear equation gives that Barclays’ estimate should be 8 basis points lower. Conversely, to push up Libor by one basis point, Barclays’ estimate needed to be 8 basis points higher. To give a little more perspective: In 2005/6 Libor was around 5% at times. If Barclays’ wanted to lower the Libor to 4.99, it needed to submit an estimate of 4.92. It might not have needed to manipulate it any more than that to profit. Now, I am no expert on Libor rates or their spreads. It may be that the spread in Libor estimates was high enough to allow Barclays’ estimate to be included in the average. In any case, presumably those submitting the rates would know more or less, from experience, what kind of range of values are usually submitted and adjust the submission accordingly. So, it seems that it was possible for Barclays’ to manipulate Libor, albeit in a somewhat limited fashion. It also appears that traders did in fact collude so that several banks altered their submissions simultaneously. This would have a far greater influence on the Libor estimate.

Should bankers go to jail?

Yes. This is an example of fraud (albeit committed by almost an entire industry). I hope to see several people behind bars for this. However, whether that will happen, given the widespread nature of the fraud and the possible difficulty in assigning culpability, I do not know. What is clear is that the fines imposed for this kind of behaviour are ineffective. They do not even make a dent in the Banks’ balance sheets. Lawsuits against Barclays may do more damage, though.

Are regulators also to blame?

It seems that regulators knew Libor was incorrect for quite some time. And did nothing. In the midst of the financial crisis they probably thought there were more pressing concerns. Perhaps they just did not want to believe that what they were told was true, and so they didn’t. Bernanke apparently knew of the troubles with Libor and told the British regulators, who did not take it seriously. So the British regulators are clearly at fault. However, morally, Bernanke is too. Here is one of the greatest financial scams in history, affecting millions of people, and you keep silent, you don’t make a public statement, you don’t force a resolution. You say in the gentlemen’s club. Something similar can be said of Tim Geithner, president of the New York Fed at the time the rigging occurred.

What to do?

Of course, Libor is now useless. I think the best thing to do would be to replace it with a similar rate, but based on actual transactions. This has been suggested by others. Of course, everyone is calling for tougher regulation. Probably, the entire structure of regulating bodies will need to be changed. It’s no use for there to be good regulation if it is not enforced. The relationship between regulators and the industry is clearly not working. Perhaps we should all start putting our money in Triodos. At least these bankers seem to have a conscience. Or perhaps we should just mutualise all the banks. No more shareholders and banks owned by depositors. Less profit motive. Perhaps the incentives would be less perverse, but honestly, I am not sure. Ideally, people would grow spines, come to believe in a higher power, or just start caring about other people, but that won’t happen.

Post-apocalypse

We have not, it seems, heard the last of this particular scandal. The investigation of other banks is going to take a while and will, hopefully, unearth some corpses. A good article says the following:

The unpalatable message of the crisis and Diamond's actions – or inaction – is that financial institutions can't be trusted to not act foolishly in pursuit of their own self interest, and that the only question is how frequently they do so and how grave the consequences prove to be either for their shareholders or for the financial system as a whole.

Banks have demonstrated time and again that they are devoid of moral rectitude, that they act selfishly and (economists would rejoice) rationally in the face of temptation. And why should they not? We always let them off the hook. As one article puts it “there’s something rotten in banking.”

References

News 

• Barr, R. (2012). Former Barclays exec admits false LIBOR submission. Newsday. Retrieved July 18, 2012, from http://newyork.newsday.com/news/region-state/former-barclays-exec-admits-false-libor-submission-1.3840836 
• Barrow, B., & Davies, R. (2012). Bob Diamond DID give orders to cut Libor, claims Barclays executive . Mail Online. Retrieved July 18, 2012, from http://www.dailymail.co.uk/news/article-2174614/Bob-Diamond-DID-orders-cut-Libor-claims-Barclays-executive.html 
• Bloomberg. (2012). There’s Something Rotten in Banking . Bloomberg View. Retrieved July 18, 2012, from http://www.bloomberg.com/news/2012-07-02/barclays-case-shows-something-s-rotten-in-banking-culture.html 
• Bloomberg News. (2012). NY among states probing interest-rate fixing. Newsday. Retrieved July 18, 2012, from http://newyork.newsday.com/news/region-state/ny-among-states-probing-interest-rate-fixing-1.3843206 
• Crutsinger, M. (2012). Bernanke: Fed had no power to change LIBOR. Newsday. Retrieved July 18, 2012, from http://newyork.newsday.com/news/region-state/bernanke-fed-had-no-power-to-change-libor-1.3843208 
• DuBois, S. (2012). The Barclays school of crisis management. CNN Money. Retrieved July 18, 2012, from http://management.fortune.cnn.com/2012/07/03/the-barclays-school-of-crisis-management/?iid=SF_F_River 
• Farrell, M. (2012). Barclays: Don’t just blame us! CNN Money. Retrieved July 18, 2012, from http://buzz.money.cnn.com/2012/07/03/barclays-libor-investigation/?iid=EL 
• McGee, S. (2012). The Big Questions Raised by the Barclays Scandal. The Fiscal Times. Retrieved July 18, 2012, from http://www.thefiscaltimes.com/Columns/2012/07/05/The-Big-Questions-Raised-by-the-Barclays-Scandal.aspx#page1 
• Morris, N. (2012). Other banks face bigger fines on rate fixing, warn Barclays directors. The Independent. Retrieved July 18, 2012, from http://www.independent.co.uk/news/business/news/other-banks-face-bigger-fines-on-rate-fixing-warn-barclays-directors-7945444.html 
• O’Toole, J. (2012). Explaining the Libor interest rate mess. CNN Money. Retrieved July 18, 2012, from http://money.cnn.com/2012/07/03/investing/libor-interest-rate-faq/index.htm 
• Reuters. (2012). RBS set for fine as Barclays boss remains defiant. The Fiscal Times. Retrieved July 18, 2012, from http://latestnews.thefiscaltimes.com/2012/06/28/uk-banks-face-new-scandal-barclays-boss-in-peril/ 
• Reuters. (2012). Barclays takes rate fixing scandal hit. Business Report. Retrieved July 18, 2012, from http://www.iol.co.za/business/international/barclays-takes-rate-fixing-scandal-hit-1.1341163 
• Rosenberg, Y. (2012). Libor-gate Explained: Why Barclays’ Scandal Matters. The Fiscal Times. Retrieved July 18, 2012, from http://www.thefiscaltimes.com/Articles/2012/07/06/Libor-gate-Explained-Why-Barclays-Scandal-Matters.aspx#page1 
• Sky News. (2012). Barclays Was “In Denial” Over Rate-Fixing. Sky News HD. Retrieved July 18, 2012, from http://news.sky.com/story/961370/barclays-was-in-denial-over-rate-fixing

An interesting blogger

• Doyle, L. (2012). Barclays Libor Scandal: Reports Regulators Knew; Time for Independent Investigation and Eliot Spitzer. Sense on Cents. Retrieved July 18, 2012, from http://www.senseoncents.com/2012/07/barclays-libor-scandal-reports-regulators-knew-time-for-independent-investigation-and-eliot-spitzer/ 
• Doyle, L. (2012). Barclays Libor Scandal: When Did Manipulation Start? Sense on Cents. Retrieved July 18, 2012, from http://www.senseoncents.com/2012/07/barclays-libor-scandal-when-did-manipulation-start/
• Doyle, L. (2012). Barclays Libor Scandal: Who’s Really to Blame? Sense on Cents. Retrieved July 18, 2012, from http://www.senseoncents.com/2012/07/barclays-libor-scandal-whos-really-to-blame/ Doyle, L. (2012). Barclays Libor Scandal: “Diamond Lied.” Sense on Cents. Retrieved July 18, 2012, from http://www.senseoncents.com/2012/07/barclays-libor-scandal-diamond-lied-to-the-committee/ 
• Doyle, L. (2012). Barclays Libor Scandal: Holding Regulators to Account. Sense on Cents. Retrieved July 18, 2012, from http://www.senseoncents.com/2012/07/barclays-libor-scandal-holding-regulators-to-account/ 
• Doyle, L. (2012). Barclays Libor Scandal: The Precedent. Sense on Cents. Retrieved July 18, 2012, from http://www.senseoncents.com/2012/07/barclays-libor-scandal-the-precedent/#more-30091
• Doyle, L. (2012). Barclays scandal: How big will this get? CNN Money. Retrieved July 18, 2012, from http://finance.fortune.cnn.com/2012/07/03/barclays-libor-scandal/?iid=EL 

Some graphs 

• FedPrimeRate.com. (2012). LIBOR rates: Historical Charts. FedPrimeRate.com. Retrieved July 18, 2012, from http://www.fedprimerate.com/libor/libor_rates_history-chart-graph.htm 

Wikipedia

• Wikipedia. (2012). Libor scandal. Wikipedia. Retrieved July 18, 2012, from http://en.wikipedia.org/wiki/Libor_scandal

1 This is a common arrangement. An organization may for instance have a variable rate loan which it needs to repay with a floating interest rate. In order to make its costs more certain, it can enter a swap contract with a bank, pay a fixed amount every month and in return the bank will pay the interest on the loan.

The Financial Modellers' Manifesto

Paul Wilmott and Emanuel Derman, both quant gurus, wrote and signed what they call The Financial Modeller’s Manifesto in 2009. It is modelled after The Communist Manifesto written by Marx, which I find quite ironic.

About the authors

Before we get onto the manifesto, I want to mention some things about the people behind it. Derman started off in South Africa, studying at the university of Cape Town, just as I did (although he got a PhD in theoretical physics). In a sense, therefore, he is a role model for me.

Wilmott started the Certificate in Quantitative Finance, a six month course. He is editor-in-chief of Wilmott magazine and has a quantitative finance forum and recruitment organisation run under his name (some hubris here?).

Both warned against the risk of misusing mathematical models long before the crisis (though I know quotes have a way of being taken out of context).

What I like about the manifesto

1. It is honest. 
2. It is written in a colloquial style, making it more accessible and emotive. 
3. The oath will always be relevant as it contains timeless principles. 
4. It is a call to action.
5. It draws the crucial distinction between physics and financial mathematics.

What I dislike

1.   There are too many specifics. CDOs might not exist in twenty years, making the manifesto applicable mostly to the present (with the exception of the oath).
2. There is too much jargon.
3.  The authors claim no responsibility. They are reacting to everyone else’s mess.
4.  It is too informal, making it harder to take seriously.
5.  It does not advise on how to fulfil its demands.
6.  Discussions about whether the Black-scholes model is good or not are not really relevant.
7.  It was written after everything it says had already become obvious.

What we need

We need clear guidance for future quants and a way to hold them accountable. The manifesto points in the right direction. It gives a useful oath, and by adjusting the first line to make it more formal (perhaps, “I know the world of finance does not function according to exact mathematical laws”) it could become something quants can put on plaques and recite as they get their qualifications.

But we need more. We need a code of ethics or a code of conduct for quants. Not a one page document that reads more as an article than anything else, but something substantial with a gravity that weighs on your conscience. More than that, though, we need people to ascribe to this code. That is, we need a professional body for quants that police their behaviour and set best practices. I find myself wondering whether actuaries can do this. We already have professional conduct standards (lacking only in specifics that will apply to quants). The creation of a quantitative finance specialisation for actuaries would allow quants to practice as actuaries and thus they would be held to these standards.

The problem is actuarial training is ill-suited to providing the kind of (highly mathematical) skills that quants need (I know this from unfortunate experience). The alternative is to create a professional body for quants alone, but this may involve a lot more work and may take years to be accepted. The public would appreciate it, I think. Throughout the financial crisis they have heard only horror stories of quants and such a large step would certainly help assuage fears, and, I think, result in more responsible practices.

Some references:

Wikipedia:

• Wikipedia, 2011a. Emanuel Derman. Wikipedia. Available at: http://en.wikipedia.org/wiki/Emanuel_Derman [Accessed January 22, 2011].
• Wikipedia, 2011b. Financial Modelers’ Manifestor. Wikipedia. Available at: http://en.wikipedia.org/wiki/Financial_Modelers’_Manifesto [Accessed January 22, 2011].
• Wikipedia, 2011c. Paul Wilmott. Wikipedia. Available at: http://en.wikipedia.org/wiki/Paul_Wilmott [Accessed January 22, 2011]

The actual manifesto:

• Wilmott, P. & Derman, E., 2009. Financial Modelers’ Manifesto. Paul Wilmott’s Blog. Available at: http://www.wilmott.com/blogs/paul/index.cfm/2009/1/8/Financial-Modelers-Manifesto [Accessed January 23, 2011].

The professional conduct standards of the Institute of Actuaries in the UK:

• Professional Affairs Board. (2007). Professional conduct standards. Retrieved from http://www.actuaries.org.uk/sites/all/files/documents/pdf/PCSV3-0.pdf.