Asset Class Investing Risk Assessment Questionnaire
By completing a short questionnaire we will both gain a better understanding of your comfort with investing in the markets, allowing us to start our conversation at a more informed beginning.
This Asset Class Risk Assessment Questionnaire is designed to help your Financial Advisor decide how to allocate your assets among different asset classes (stocks, bonds, and short-term reserves), based on your investment objectives and experience, time horizon, risk tolerance, and financial situation. You and your Financial Advisor are under no obligation to accept the suggestions provided by this questionnaire and you should carefully consider all of your options before investing. This Questionnaire is provided as a guide to help you and your Financial Advisor in choosing an appropriate investment portfolio and should not be construed as investment advice.
The suggestions provided are based on generally accepted investment principles. There is no guarantee, however, that any particular asset allocation or mix of funds will meet your investment objectives. All investments involve risks, and fluctuations in the financial markets and other factors may cause declines in the value of your account. You should carefully consider all of your options before investing.
The questionnaire bases the rate of return on historic data from 1972 to 2013. Some estimates may be high because the inflation rate during this period of 4.2% was higher than the longer-term historic average inflation rate of 3% from 1926 to 2013.
Investors in stocks, bonds and other asset classes can reasonably expect to see the value of their investment portfolios fluctuate. Depending on global economic conditions and the makeup of their portfolios, investors may experience unsettling periods of mild, moderate or even severe losses. Such losses can be difficult to tolerate and may lead investors to lose confidence in their investment policy.
Be aware that questions 7, 8, and 9 of the Risk Assessment Questionnaire are optional. These questions are meant to address your preferences for international, value, and small investments. When these questions are left unanswered, your target model will automatically allocate to neutral positions in international, value, and small. In the case that you choose not to answer questions 7, 8, and 9, your Financial Advisor may choose to answer these questions on your behalf.
Please note that the suggested asset allocations within this Questionnaire depend on subjective factors such as your risk tolerance and financial situation. The results should be considered along with the specific details of your personal financial situation for more comprehensive advice from your Financial Advisor. The potential tax implications of any modifications to your current mix of investments should also be considered.
Remember, past performance is not indicative of future performance. All investments involve risk, including loss of principal. Bonds are subject to risks, including interest rate risk, which can decrease the value of a bond as interest rates rise. Small company stocks have additional risks, including greater volatility and less liquidity than stocks of larger companies. Value companies have more risk than growth companies and may underperform when the market favors growth companies. Foreign securities involve additional risks, including foreign currency changes, political risks, foreign taxes, and different methods of accounting and financial reporting. Diversification and buy-and-hold strategies do not guarantee a profit or principal protection.