Client Risk Profile

Client information

Please answer the following 15 questions as candidly as you can. There are no right or wrong answers; your responses simply help us understand the level of risk you are comfortable with.

Full Name

Email Address

When answering, please consider your answers as reflecting your feelings toward…

My entire portfolio Only the money managed by the Wealth Manager

Risk assessment

01. Time Frame

How many years can you let your money grow before you will need to start significant withdrawals? This is important because it indicates your financial ability to ride out down-cycles.

If the working time frame for your investment portfolio is…

1-2 years 3-5 years 6-10 years More than 10 years

02. Years to Retirement

Where are you in relation to retirement? The farther you are from retirement, the more risk you can take in your investing.

If the number of years between now and your retirement is…

03. Financial Cushion

Take a look at your total financial position and the cushion (assets you have outside of your investment portfolio for emergencies) you have set aside. This will help you decide how much risk you should prudently take in your investing.

If you have…

Little outside savings set aside, hence preservation of principal is very important Reasonable savings set aside, and are willing to take moderate risk for moderate returns Ample savings set aside (mortgage is paid off, own CDs, insurance, etc.), hence you feel comfortable taking larger risks for maximum return potential

04. Cash Flow

What is your planned cash flow into and out of your investment portfolio over the next 3-5 years? Do you plan to contribute regularly to your investment portfolio, or do you intend to take out more than you put in? Negative cash flow (withdrawing principal) would suggest a low risk tolerance, while positive cash flow (adding money on a regular basis) would tend to allow for some short-term volatility in the pursuit of higher returns.

If your plans are to…

Withdraw money on a continuing basis Neither add nor withdraw money Add new money on a continuing basis

05. Special circumstances

Although it is difficult to plan for the unexpected, are there any special circumstances you can envision (college tuition, home purchase, retirement, extended travel, medical, etc.) outside your usual contributions and withdrawals, that might necessitate the immediate liquidation of a major portion of your portfolio over the next 3-5 years?

If you can envision…

Full portfolio could be liquidated Major liquidations Some small liquidations No liquidations

06. Need for Income

How important is current income to you in the near term? Do you depend on income from your investment portfolio for living expenses?

If current income is…

Critical Needed to a large degree Needed to a minor extent Not important

07. Attitude towards losses

Pretend you have a 25% loss in a mutual fund over the last year due to a general market decline, not poor fund management.

What would you do now?

Sell all my shares of the fund Sell some shares of the fund Hold onto my shares Buy more shares in the fund

08. Long range Objective

When saving for the future most people desire a return equal to or above inflation. However, historically the more return above inflation an investor expected the more ups and downs they had to endure. Listed below are target rates of return above inflation with the accompanying volatility that the investor would have experienced over an investment cycle of 30 years.

Please select the return/volatility relationship which most closely matches your goals. Inflation has averaged 5.75% over the long term.

At least equal to inflation of 5.75% Inflation plus 1-1/2% annually (Gross 7.25%) over the investment cycle, with the possibility of a loss of 0% to 5% over a 12-month period Inflation plus 3% annually (Gross 8.75%) over the investment cycle, with the possibility of a loss of 5% to 10% over a 12-month period Inflation plus 4% annually (Gross 9.75%) over the investment cycle, with the possibility of a loss of 10% to 20% over a 12-month period Inflation plus 5% annually (Gross 10.75%) over the investment cycle, with the possibility of a loss of 20% to 30% over a 12-month period Inflation plus 6% annually (Gross 11.75%) over the investment cycle, with the possibility of a loss of 30% to 40% over a 12-month period

09. Investing Attitude

How do you feel you would react to up and down movements in your portfolio value?

I am very concerned any time my portfolio loses value. I like to check the current value of my holdings frequently, so that I can sell quickly if they start to lose money Daily market changes make me uncomfortable, but I try not to overreact. If an investment loses 5% or more over a quarter, I am likely to sell it and look for something less volatile I realize that daily changes in price in financial markets can sometimes be substantial. Even if poor market conditions result in losses of 20% to 30% in a year, I would continue a long-term investment plan I feel is appropriate for my needs Even if poor market conditions result in losses of 30% to 40% in a year, I would continue a long-term investment plan I feel is appropriate for my needs

10. Feeling towards Risk

Finally, give your personal feeling about investment losses, and how willing you are to tolerate losses emotionally, by rating your risk tolerance.

11. Importance of short term safety

Which of these unattractive events would you prefer, if one had to occur?

Holding cash/money market funds when the market goes up Holding stocks when the market goes down

12. Short term concern

Which of these unattractive events would you prefer, if one had to occur?

Selling a stock and seeing it immediately increase in value Buying a stock and having it immediately decrease in value

13. Attitude towards returns

If you were faced with the following three alternatives which would you choose?

Consistent short-term (1 year) returns even though long-term (5 years or longer) returns may be lower No preference Higher long-term (5 years or longer) returns even though the returns may vary greatly over the short-term (1 year)

14. Annual portfolio returns

The graph below shows the returns of a hypothetical portfolio over time. If you owned this portfolio, given its historical and current returns, which answer best describes the action you would take?

Select the action you would take

I would immediately pull out of the portfolio and cut my recent losses I would endure the current loss and hope for the higher future returns I would invest more in the portfolio now that the price is lower

15. Risk/Return

The following graphs show the historical return of three hypothetical investments. This question is designed to assess your tolerance for risk (volatility) relative to a given level of return. Given the fluctuations in the returns of each investment, if your time horizon was long-term (greater than 10 years), which investment would you choose?

Investment A

Average annual return of 7.5%

Investment B

Average annual return of 11%

Investment C

Average annual return of 14.4%

Which investment would you choose?

Investment A Investment B Investment C

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