Warren Financial Risk Tool

How Risky R U?  Take a look at this graph and decide what type of risk taker you are.  There are 5 categories to choose from A, B, C, D, or E.

In the above graph, there are five groups.  Each group represents a sample portfolio, A through E.  Each individual bar within a group represents one year of performance. 

The above five portfolios are depicted showing their annual percentage return over five successive years.  If all of your investments were invested under one of these strategies, which strategy would you prefer? 

A  B  C  D  or  E 

E-mail your preference to: Warren Financial Service

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Notes about the above portfolios. 

Portfolio A is a very conservative portfolio.  It represents an investor who is concerned with safety most of all.  This investor is willing to miss out on better performance in an effort to ensure they don’t lose money.

Portfolio B is still conservative, but is also a bit concerned about ensuring that assets grow fast enough to beat inflation.  This investor is willing to take a bit more risk than investor A, yet not too much.  This investor may be interested in generating some regular income from his/her investments.

Portfolio C is middle of the road.  It represents an investor who is willing to take some risks to ensure a good return.  This investor is usually not concerned about generating income from their investments, but more concerned with growth.  This investor will probably want to be invested in stocks and mutual funds, but maintain a great deal of diversification.

Portfolio D is a growth portfolio.  It represents an investor who is mainly concerned with growth, even if it means the portfolio will experience more “ups and downs” during economic and market cycles.

Portfolio E is an aggressive growth portfolio.  It represents an investor who wants to grow their portfolio.  This approach accepts  large amount of risks in an effort to achieve exceptional performance.  This investor is willing to tolerate violent swings in value including major losses in an effort to achieve major market beating growth.

The information above contains one basic assumption which is that in order to generate greater returns, an investor must accept greater risk.  Greater risk leads to more volatility in portfolio performance.

Warren Financial is concerned about your risk/reward trade-off.  We can build a portfolio which meets your needs.