Risk Tolerance Quiz If you're eoing to be investing, you need to know your isk teleranca. it will heip you fccus in on the kinds of investment alteratives that make sense for you. Below is a very simple risk tolerance qui2 designed to you an idea of wat your risk tolerance is. If you would ike to take a more advanced risk scletance quiz, check out the following Web sites: A Risk Tolerance Quit developed by Dr. Ruth Lyttem at Virinia Tech and Dr. Jehn Grable at Kansas State University http:jaes.rutgers.edu/ monay/riskquiz/default.asp MSN Maney Central Risk Tolerance Qaiz, which pravides you with a score for both your risk capacity and your risk 1. You've just ineestad your savings ot $25,000. What range of setums on your investment would you feel most coefortable with ater 1 year? a $24,000-$26,500 (1 pont) b $23,000-$28,000 (2 points) c $21,000-$31,000 (3 points) d $19,000-$34,000 (4 points) You've already saved and paid for the vacation of your lifetime, but just before you are to leave, your job i downsiped" and you are left wthout a job. You wculd a Canoel the vacation and start looking for a new job. (1 point b Scale down your vacation to save monay. (2 points) c. Go ahead with your vacation, and begin putting togerter a strategy for inding a new job while you're on acation. (3 points) d. Extend your vacatiorc after all, this may be your last chance to have a vacation like this (4 peins) 3. Aher you make an ivestment you feet a Nauseous (1 point b Confused (2 points) c Seished (3 poists d. Excited (4 points) You have just been given $4,000 and you must choose between: A sure loss of $1.000(1 point b. A 50 percent chance of locing $2.000 and a 50 percent chance of losing ncthing (3 peints) The stock market dropped by 10 pecent teday. Your a. Sell ell your stock and put it in a money mafket or savwings account; after all, sleeping is inportant (1 point) b Just hold tight and wait for things to reoum to where they ware (3 points) c Invest more because stocks are at bargais prices. (5 points) Total Score: Sconing S-13 points: Low risk tolerance. The lower you scone, the more rik averse you are cu should attempt to leam mone bout risk-return trade-ofs. You should make sure you are adequately diversified focusing on sefer investments, and attempt to add riskier investments as you gain a bettor undenstanding of irvesting. 14-20 points: High risk tolerance. The higher you score, the less risk averse you are. You are more comfortable with risky investments, being drawn to imestments such as common stock rather than money market accounts and CDs You should make sure your portoio is adequately LE. Grable and R.H. Lytton: "Financial risk tolerance revisited: The development of a risk assessment isstrument Financial Services Review 8(1999): 163-81 Risk Tolerance Quiz If you're eoing to be investing, you need to know your isk teleranca. it will heip you fccus in on the kinds of investment alteratives that make sense for you. Below is a very simple risk tolerance qui2 designed to you an idea of wat your risk tolerance is. If you would ike to take a more advanced risk scletance quiz, check out the following Web sites: A Risk Tolerance Quit developed by Dr. Ruth Lyttem at Virinia Tech and Dr. Jehn Grable at Kansas State University http:jaes.rutgers.edu/ monay/riskquiz/default.asp MSN Maney Central Risk Tolerance Qaiz, which pravides you with a score for both your risk capacity and your risk 1. You've just ineestad your savings ot $25,000. What range of setums on your investment would you feel most coefortable with ater 1 year? a $24,000-$26,500 (1 pont) b $23,000-$28,000 (2 points) c $21,000-$31,000 (3 points) d $19,000-$34,000 (4 points) You've already saved and paid for the vacation of your lifetime, but just before you are to leave, your job i downsiped" and you are left wthout a job. You wculd a Canoel the vacation and start looking for a new job. (1 point b Scale down your vacation to save monay. (2 points) c. Go ahead with your vacation, and begin putting togerter a strategy for inding a new job while you're on acation. (3 points) d. Extend your vacatiorc after all, this may be your last chance to have a vacation like this (4 peins) 3. Aher you make an ivestment you feet a Nauseous (1 point b Confused (2 points) c Seished (3 poists d. Excited (4 points) You have just been given $4,000 and you must choose between: A sure loss of $1.000(1 point b. A 50 percent chance of locing $2.000 and a 50 percent chance of losing ncthing (3 peints) The stock market dropped by 10 pecent teday. Your a. Sell ell your stock and put it in a money mafket or savwings account; after all, sleeping is inportant (1 point) b Just hold tight and wait for things to reoum to where they ware (3 points) c Invest more because stocks are at bargais prices. (5 points) Total Score: Sconing S-13 points: Low risk tolerance. The lower you scone, the more rik averse you are cu should attempt to leam mone bout risk-return trade-ofs. You should make sure you are adequately diversified focusing on sefer investments, and attempt to add riskier investments as you gain a bettor undenstanding of irvesting. 14-20 points: High risk tolerance. The higher you score, the less risk averse you are. You are more comfortable with risky investments, being drawn to imestments such as common stock rather than money market accounts and CDs You should make sure your portoio is adequately LE. Grable and R.H. Lytton: "Financial risk tolerance revisited: The development of a risk assessment isstrument Financial Services Review 8(1999): 163-81