Ditch the Age-Based Assumptions About Risk Tolerance & Find Out Your Score
Risk tolerance is the degree of variability in investment returns that an investor is willing to withstand. Your level of comfort with risk is important in developing a solid investment plan because if your portfolio has too much risk and the market experiences a negative shock, it could lead to an early sell off that could cost you money. If, on the other hand, your investment portfolio isn’t aggressive enough, you might not have as much money as you need or want to achieve your dreams.
When your portfolio expectations properly match your risk tolerance level, you’ll be a better informed investor.
With questions rooted in scientific theory, your specific risk tolerance level can take into account who you are and what you want.
Answer theoretical questions about potential risk events to determine how comfortable you really are with potential losses.