What are 'investment firms' required to disclose under FCA regulations?

Investment firms are required to disclose comprehensive information about the risks and performance of financial products under FCA regulations to ensure that consumers and investors make informed decisions. This requirement aligns with the FCA's commitment to transparency and consumer protection. By providing detailed insights into the associated risks as well as potential performance outcomes, investment firms enable customers to assess the suitability of different financial products relative to their individual risk profiles and investment objectives.

This disclosure is essential as it empowers consumers to understand not only how a product has performed historically but also the uncertainties and potential pitfalls involved in investing. This aligns with the FCA's goal of fostering a market where consumers are well-informed and can engage with financial products confidently, ultimately promoting fair competition and innovation within the sector.

In contrast, other options do not reflect the full scope of disclosure required by the FCA. For example, while potential investments and past performance data may be relevant, they do not encompass the essential elements that include a thorough assessment of risks and performance conditions. Similarly, market trends and consumer behaviors, while valuable for understanding the broader context, do not provide the specific information that investment firms are mandated to disclose to their clients regarding individual financial products.