Inquiry should be made about which factors to make suitable recommendations to customers?

• A. I, II, III, IV
• B. I, II, III
• C. III and IV only
• D. I and II only

Answer: (A)

To make suitable recommendations, you must gather complete information on four areas that affect risk and goals: the customer’s financial situation, tax considerations, investment experience, and investment objectives (including time horizon and liquidity needs). Only by covering all these areas can you accurately assess what level of risk is appropriate and what kinds of investments align with their goals. If any area is left out, the recommendation may be inappropriate for the customer’s capacity or objectives. Because all four factors are necessary, gathering information on all of them leads to the most suitable guidance.