It is imperative that a client’s attitude to risk and capacity for loss are taken into account with all investments and pensions. Shirley works through a risk profile document with every client to make sure that all recommended funds are completely appropriate for them.
Unlike the days of the week, a person’s acceptance of risk is uncertain and difficult to measure but is fundamental in the whole process of investing money. The more risk a person is prepared to take the greater the potential rewards and losses. Likewise, low risk brings the probability of low returns while limiting the potential downside.
Attitude to risk and capacity for loss are sometimes difficult and complex, but it is essential that you and Shirley agree and get them right!
The answers to the questionnaire that she uses will provide a comprehensive report and will also identify any areas of conflict in your answers which may be dealt with.
Regular reviews are important to:
- Check that your attitude to risk has not changed (which it probably will as you get older)
- Check that your term for investment has not changed (which it probably has!)
- Check that the funds/assets selected still meet your investment criteria and goals
- Check that the percentages held within each of the funds have not got out of balance
Therefore a regular programme of reviews is needed.
Every year you are more than likely to have your car serviced and MOT’d- your investments and pensions are no less valuable and deserve similar treatment. Shirley will discuss this with you.