There have been many ways in the past to assess personal risk tolerance. Many individuals and advisors may simply base risk tolerance on age, assuming the investor will be more aggressive when they are younger and more conservative when approaching or in retirement.
Risk tolerance questionnaires can help in assessing an investor's personal risk tolerance. However, the end results still may not help an investor understand how their tolerance relates to their portfolio. That is why we utilize a process that provides you with a "Risk Number". It is a quantitative way to pinpoint how much risk you want, how much risk you currently have in your portfolio, and how much risk you need to take to reach your goals. This knowledge provides greater clarity and helps with better decision-making.
You can take the 5-minute Riskalyze questionnaire by clicking here. Once complete, we will share your results with you and will also do a complimentary portfolio analysis so you can see if your personal Risk Number matches with the Risk Number of your portfolio.
Of course, there are always other factors for consideration. The results from the risk questionnaire provide useful insights which can be further enhanced by the conversation between a financial advisor and an investor. We would be happy to discuss your situation in more detail and help put you in a better financial position. Feel free to take the 5-minute risk questionnaire or reach out with any questions!