Before we can help someone develop an effective investment strategy, we need to know how much risk they are willing to accept in their portfolio. This is important because people who have their portfolio positioned improperly tend to make emotional decisions whenever the market goes up or down. Knowing your "risk number" and being positioned properly based on that "risk number" can help manage expectations you have for your portfolio.
In order to help our clients find their "Risk Number," we use a system called Riskalyze. Built on the academic framework called Prospect Theory that won the Nobel Prize for Economics in 2002, Riskalyze is the first-ever way to pinpoint an investor's risk tolerance with math, and engineer portfolios to fit each individual.
Riskalyze helps us understand each individual's feelings and biases regarding financial risk in the context of their personal financial position. The questionnaire requires the context of their total investment amount, and the amount they would have to lose to reach the state of "financial devastation." Click on the button above to start your personal risk analysis and find out what your "Risk Number" is.