Risk Assessment
Name
First Name
Last Name
City
State
Best Contact Number
Format: (000) 000-0000.
Best E-mail
Age
What are your overall investment objectives?
What is your primary goal for investing?
PRESERVING WHAT I'VE EARNED
GENERATING INCOME TO LIVE OFF
CAPITAL APPRECIATION
CAPITAL APPRECIATION & INCOME
Section A: Financial Risk Capacity
Your objective financial ability to withstand investment losses.
What is your investment time horizon for these funds?
*
Less than 2 years
2 to 5 years
6 to 10 years
11+ years
How many months of emergency living expenses do you have saved in cash?
*
Less than 1 month
1 to 3 months
3 to 6 months
6+ months
How would you describe your household income stability over the next 3–5 years?
*
Unstable / Variable / Commission-based
Moderately stable / Expect minor fluctuations
Very stable / Salaried or multiple steady income sources
How significant are your non-discretionary monthly debt obligations (e.g., mortgage, student loans, consumer debt)?
*
High (Debt payments take up a large portion of cash flow)
Moderate (Manageable monthly payments)
Low or None (Very low debt-to-income ratio)
How reliant are you on this portfolio to achieve your near-term financial goals?
*
Extremely reliant (Need these funds short-term)
Moderately reliant (On track, but need growth)
Minimal reliance (Substantial asset base or secondary goal)
Section B: Risk Tolerance
Your comfort with investment risk and uncertainty.
In general, how would your best friend describe you as a risk taker?
*
A real risk avoider
Cautious
Willing to take risks after completing adequate research
A real gambler
You are on a TV game show and can choose one of the following. Which would you take?
*
$1,000 in cash
A 50% chance at winning $5,000
A 25% chance at winning $10,000
A 5% chance at winning $100,000
You have just finished saving for a "once-in-a-lifetime" vacation. Three weeks before you plan to leave, you lose your job. You would:
*
Cancel the vacation
Take a much more modest vacation
Go as scheduled, reasoning that you need the time to prepare for a job search
Extend your vacation, because this might be your last chance to go first-class
If you unexpectedly received $20,000 to invest, what would you do?
*
Deposit it in a bank account, money market account, or an insured CD
Invest it in safe high quality bonds or bond mutual funds
Invest it in stocks or stock mutual funds
In terms of experience, how comfortable are you investing in stocks or stock mutual funds?
*
Not at all comfortable
Somewhat comfortable
Very comfortable
When you think of the word "risk," which of the following words comes to mind first?
*
Loss
Uncertainty
Opportunity
Thrill
Some experts are predicting prices of assets such as gold, jewels, collectibles, and real estate (hard assets) to increase in value; bond prices may fall, however, experts tend to agree that government bonds are relatively safe. Most of your investment assets are now in high-interest government bonds. What would you do?
*
Hold the bonds
Sell the bonds, put half the proceeds into money market accounts, and the other half into hard assets
Sell the bonds and put the total proceeds into hard assets
Sell the bonds, put all the money into hard assets, and borrow additional money to buy more
Given the best- and worst-case returns of the four investment choices below, which would you prefer?
*
$200 gain best case; $0 gain/loss worst case
$800 gain best case; $200 loss worst case
$2,600 gain best case; $800 loss worst case
$4,800 gain best case; $2,400 loss worst case
In addition to whatever you own, you have been given $1,000. You are now asked to choose between:
*
A sure gain of $500
A 50% chance to gain $1,000 and a 50% chance to gain nothing
In addition to whatever you own, you have been given $2,000. You are now asked to choose between:
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A sure loss of $500
A 50% chance to lose $1,000 and a 50% chance to lose nothing
Suppose a relative left you an inheritance of $100,000, stipulating in the will that you invest ALL the money in ONE of the following choices. Which one would you select?
*
A savings account or money market mutual fund
A mutual fund that owns stocks and bonds
A portfolio of 15 common stocks
Commodities like gold, silver, and oil
If you had to invest $20,000, which of the following investment choices would you find most appealing?
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60% in low-risk / 30% in medium-risk / 10% in high-risk investments
30% in low-risk / 40% in medium-risk / 30% in high-risk investments
10% in low-risk / 40% in medium-risk / 50% in high-risk investments
Your trusted friend and neighbor, an experienced geologist, is putting together a group of investors to fund an exploratory gold mining venture. The venture could pay back 50 to 100 times the investment if successful. If the mine is a bust, the entire investment is worthless. Your friend estimates the chance of success is only 20%. If you had the money, how much would you invest?
*
Nothing
One month's salary
Three months' salary
Six months' salary
Risk Capacity Score
Risk Tolerance Score
Risk Capacity Tier
Risk Tolerance Tier
Preliminary Risk Profile
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