Risk Tolerance & Profile

A Risk Profile is used to classify individuals risk tolerance. This is determined by answering a series of questions in a risk profile questionnaire.

The questionnaire’s purpose is to determine the level of risk an individual is willing to take on, in order to achieve their desired return. Once your risk profile is known, it is used to determine the most appropriate asset allocation for your Superannuation or other investments. 

You can read more about risk and return here.

The main categories of risk profiles are as follows;

High Growth:

High growth investors are prepared to take higher risks for potentially greater returns. A high risk of capital loss is therefore to be expected.

HighGrowthChart

Growth:

The primary concern of growth investors is to accumulate assets over the medium to long term. A medium-high risk of capital loss is therefore expected.

GrowthChart

Balanced:

For balanced investors, calculated risks are acceptable to achieve better returns. A medium risk of capital loss is therefore expected from time to time.

BalancedChart

Moderately Defensive:

Typically, moderately defensive investors seek to protect the wealth they have already accumulated. A medium-low risk of capital loss is therefore expected.

ModeratelyDefensiveChart

Defensive:

A defensive investor’s portfolio should be biased towards security of capital. A low risk of capital loss is therefore expected.

DefensiveChart

Secure:

A secure investor’s portfolio should not be exposed to fluctuations in the market, by remaining in stable investments such as cash. A very low risk of capital loss is therefore expected.

SecureChart

Next Steps:

If you’re unsure what profile you fall into and would like advice then please contact us to speak with an advisor.
If you understand your risk profile and are looking for advice on the best fund for you then you can get advice via our digital advice service or by contacting us to speak with an advisor.

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