Members must disclose material risks — True or False?

Yes, members are required to disclose material risks. In any professional client relationship, it is not enough to explain only the potential returns of an investment — the associated risks must also be clearly communicated. A material risk refers to any risk that could influence a client’s investment decision. If knowing that risk might make a client reconsider, delay, or reject the investment, then it must be disclosed. This includes risks such as: Possibility of capital loss Liquidity constraints Market volatility Use of leverage Currency exposure Complexity of the product Clients rely on professionals to make informed decisions. If important risks are hidden, downplayed, or not explained in simple terms, it can mislead the client and result in unsuitable investment choices. Therefore, full and fair disclosure of all material risks is an essential ethical responsibility. It ensures transparency, protects client interests, and supports informed decision-making. So, the statement is True.