A financial services provider is advertising an investment product that can fluctuate in value and does not guarantee a return of capital. Which warning statement must be included in the advertisement?

• A. If you invest in this product, you may lose some of the money you invest.
• B. The value of your investment will fluctuate.
• C. The value of your investment may go down as well as up.
• D. The value of your investment may go up as well as down.

Answer: (C)

The main idea being tested is how investment risk must be communicated in advertising. When a product can fluctuate in value and does not guarantee return of capital, the disclosure should clearly flag that there is a real risk of losing money as well as the possibility of gains. Saying that the value may go down as well as up communicates this downside risk in a direct, unambiguous way, which aligns with investor protection goals and helps expectations be realistic.

This wording is more precise about potential loss than simply stating that value may fluctuate or may go up as well as down. The phrasing that emphasizes the value may go down as well as up ensures consumers understand that capital is not guaranteed and that losses are possible, which is the core risk message advertising for such products must convey.