When providing information on simulated performance on an investment product:

• A. the information must exclude transaction costs that may have been incurred.
• B. the source of the information must be stated.
• C. the information must be accompanied by a warning saying that 'these figures are a reliable guide to future performance'.
• D. the minimum period that must be used is ten years.

Answer: (B)

Stating the source of simulated performance is essential because it provides transparency about where the data comes from and how it was created. Knowing the source lets investors judge the reliability, methodology, and potential biases behind the figures, and it enables verification or comparison with other data. Without a source, the information may be arbitrary or misrepresentative, making it hard to assess credibility.

Costs being included or excluded isn’t the central requirement here; what matters is clear disclosure about how the numbers were generated and where they come from. Likewise, a blanket warning that “these figures are a reliable guide to future performance” is misleading, since simulated performance isn’t guaranteed to reflect future results. There’s also no universal ten-year minimum period for simulated performance; the period should align with the product’s data history and relevant context.