Investment Personality Type Matrix + Susanne Case ng Make Decision Based on T Make Decision Based on Feeling nvestors ost Risk autious Investors Decision based on objective FACTS Research market and stock for potential investment; work hard; disciplined Conservative nature of their investment High need for financial security; strong desire to avoid loss Over-analyze (miss) investment opportunity * Averse * * Advising is not easy as they are confident with. Do not like to make their own decision their methodical investment Once decisions are made, portfolio exhibits low turnover/low volatilit * Spontaneous Investors east Risk Averse vidualist Investors Do homework and self-confident Like HOT investment; make quick decisions in the heat of the moment PF has high turnover and frequent trading Risk takes a back seat in their investment * (overconfident) that they will succeed in the long run Question analyst recommendations Like to make independent decisions Consider themselves investment expert * * * Do not consider themselves as expert; but do not trust professionals, either. Suzanne, age 60, recently retired from her position as an international fashion designer. She has accumulated $3 million for retirement. She supports her son, Barry, age 40, his wife, and three children (age 14, 12, and 10) Neither Barry nor his wife work outside the home Suzanne estimates that she will need $60,000 (in todays' dollars) annual to live comfortably. Inflation is expected to be 3% annually, and she is in the 28% marginal tax bracket. She plans to continue supporting her son and his family on S30,000, also indexed for inflation. However, she has informed them that should she die, a gift fund will be established with the local museum and that her sons' family will only receive $20,000 in interest from the gift account. Otherwise, the fund will be managed for the benefit of the museum. Thus, another goal is to maintain her principal in the retirement fund for her gift account with the museum. Suzanne has a desire to travel to Europe for two months as a retirement present to herself and requires S50,000 for her travel expenses. Suzanne states that she is willing to assume some risk to obtain her objective * Classify Suzanne investment personality typ