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AUTH App 1.28 Advice or information

AUTH App 1.28.1G

In the FSA's view, advice requires an element of opinion on the part of the adviser. In effect, it is a recommendation as to a course of action. Information, on the other hand, involves statements of fact or figures.

AUTH App 1.28.2G

In general terms, simply giving information without making any comment or value judgement on its relevance to decisions which an investor may make is not advice.

AUTH App 1.28.3G

Information may often involve:

  1. (1)

    listings of share and unit prices;

  2. (2)

    company news or announcements;

  3. (3)

    an explanation of the terms and conditions of an investment;

  4. (4)

    a comparison of the benefits and risks of one investment as compared to another;

  5. (5)

    league tables showing the performance of investments of a particular kind against set published criteria;

  6. (6)

    details of directors' dealings in the shares of their own companies;

  7. (7)

    alerting persons to the happening of certain events (for example, XYZ shares reaching a certain price).

AUTH App 1.28.4G

In the FSA's opinion, however, such information may take on the nature of advice if the circumstances in which it is provided give it the force of a recommendation. For example:

  1. (1)

    a person may offer to provide information on directors' dealings on the basis that, in his opinion, were directors to buy or sell investors would do well to follow suit;

  2. (2)

    a person may offer to tell a client when certain shares reach a certain value (which would be advice if the person providing the information has offered to do so on the basis that the price of the shares means that it is a good time to buy or sell them); and

  3. (3)

    a person may provide information on a selected, rather than balanced, basis which would tend to influence the decision of the recipient.