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The Risk Tolerance Questionnaire Explained

| Leslie Kelly

AFA’s advisors are fiduciaries which means we act in your best interests. To do so, we have to get to know you- and that is important to you and to us.

The initial diagnostic tool we use is the Risk Tolerance Questionnaire. It is on our website ( under “Getting Started”. We use it to provide you with an initial Investment Policy Statement. that gives you and us a picture of what kind of investor you are including your time frame (how long before you will be using the money), whether you are planning for retirement or other financial goals, and how much risk you are willing to take.

These are important components in deciding what is appropriate for you. We have a structured, disciplined approach to investing and this tool helps us match a portfolio to you.

The questions you provide on the questionnaire are used to prepare an Investment Policy Statement. No client should ever proceed with an investment strategy without one. The Investment Policy Statement does this:

1. Explains our responsibilities to you should you decide to become a client and your responsibilities to us.

2. Explains your objectives and goals for this investment portfolio and any extenuating circumstances that we should know.

3. Explains who is responsible for the account(s) and who should get a copy of this document.

4. Outlines the asset classes and percentage of each that would comprise your portfolio with long term probability of return for that asset allocation.  Asset allocation is simply the way in which your money is divided among 9-10 no-load, low-cost mutual funds carefully selected to work together in an account. It provides a responsible approach to the money you have worked so hard to accumulate.

5. Shows you the benchmark against which your portfolio will be compared on your Portfolio Performance reports.

6. We rely on Nobel Prize-winning research to develop these structured accounts and have used this approach for more than 25 years.

Please feel free to complete the Risk Tolerance Questionnaire. We will provide you with an initial preliminary Investment Policy Statement at no charge or obligation. It can, of course, be amended as we get to know you better. Contact Leslie Kelly, CFP®, AIF® at lkelly@afadvisors.comfor more information or call 407-620-5988 ext. 1.


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