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RISK TOLERANCE SCORING TOOLS & ASSET ALLOCATION

JUST FILL IN THE GREEN BOX (ANSWER) WITH A,B,C,D,or E

ANSWER

Which statement best describes your level of investment experience?

A.	I have never invested in stocks, bonds or mutual funds.
B.	I have invested less than 50% of my net worth (excluding home equity) in stocks, bonds or mutual funds.
C.	I have invested more than 50% of my net worth (excluding home equity) in stocks, bonds or mutual funds.
D.	In addition to investing in stocks, bonds or mutual funds, I have invested in commodities, options, futures, limited partnerships, international stocks or currency markets, or have invested on margin.

Which statement best describes your long-term investment objectives?

A.	I am willing to accept substantial market risk and potential loss of principal in pursuit of higher returns.
B.	I am seeking capital appreciation and am willing to accept some losses for potentially higher returns.
C.	I am seeking a balance between capital appreciation and stability with little fluctuation between gains and losses around my targeted return.
D.	I can tolerate small, short-term losses but am concerned about protecting principal.
E.	I prefer very little or no risk of loss. My main concerns are safety of principal and a stable return.

Which statement best describes your main source of income?

A.	Adequate, predictable and steadily growing.
B.	Sufficient for the present, but I do not know if it will continue to meet my needs in the future.
C.	Inadequate and unpredictable. I may need to withdraw some investment assets to meet my current needs.

What is your response to the following statement: Aside from my portfolio, I have adequate liquid assets to meet major expenses in the next 12 months.

A.	I strongly agree.
B.	I agree.
C.	I neither agree nor disagree
D.	I disagree.
E.	I strongly disagree.

What percentage of your total net worth (excluding home equity) do you plan to invest ?

A.	More than70%
B.	Between 50% and 75%
C.	Between 25% and 50%
D.	Less than 25%

In general, seeking higher investment returns may expose you to greater volatility and risk of loss. (Risk is defined as the unpredictability of investment returns-the chance that the actual return from investing in an asset class will be different from its assumed return. Risk is measured statistically using standard deviation.) The graph & table below illustrate the hypothetical performance of five portfolios and the range of possible returns for each.

Hypothetical 1-Year Range of Returns (Gain or Loss Each Year)

	Hypothetical 1-Year Loss	Hypothetical 1-Year Gain	Hypothetical Long-Term Return (Average Annual Total Return over 10 Years
Portfolio A	-2.0%	5.0%	2.75%
Portfolio B	-5.0	11.5	6.00
Portfolio C	-10.0	18.0	8.50
Portfolio D	-14.0	25.3	10.50
Portfolio E	-19.5	34.3	12.00

Which portfolio best fits your risk tolerance and desire for long-term return?

A.	Portfolio A
B.	Portfolio B
C.	Portfolio C
D.	Portfolio D
E.	Portfolio E

Short-term volatility often accompanies higher long-term return. The data below depicts the annual total return for each of three hypothetical investments over a 20-year time horizon. Generally, lower risk accompanies less volatility of investment returns, as there is less fluctuation around the average.

Investment A : average annual return 7.85%, risk 3.43%
Investment B : average annual return 10.08%, risk 7.63%
Investment C : average annual return 12.71%, risk 16.92%

Which investment best matches your risk and return preferences?

A.	Investment A
B.	Investment B
C.	Investment C

If your portfolio is worth $100,000 today, how large a decline in value could you tolerate before changing your allocation strategy?

A.	25 % or more (portfolio value less than $75,000)
B.	20-25% (portfolio value between $75,000 and $80,000)
C.	10-20% (portfolio value between $80,000 and $90,000)
D.	5-10% (portfolio value between $90,000 and $95,000)
E.	Less than 500 (portfolio value greater than $95,000)

TOTAL SCORE Points

RISK TOLERANCE

CATEGORY :

STOCK	FIXED INCOME	CASH

Risk Tolerance Score	Risk Tolerance Category	Descriptions
1 - 6 Points	Conservative	In this risk category, preservation of capital is the single most important concern of the investor.
7 - 13 Points	Conservative to Moderate	In this risk category, preservation of capital and income are the most important objectives and a slightly greater willingness to accept risk.
14 - 20 Points	Moderate	Investors in this risk category accept possible principal loss as a natural function of investment risk incurred in the pursuit of higher total return.
21 - 26 Points	Moderate to Aggressive	Investors in this risk category are more willing to take risk, both in the types of securities held and in
27 - 32 Points	Aggressive	Investors in this risk category typically are willing to sustain more in the way of losses on individual transactions.
		Investors in this category may experience a wide variance in results from on year to the next in the pursuit of longer-term goals.

Risk Profile	Asset Allocation
Risk Profile	Stock	Fixed Income	Cash
Conservative	10%	55%	35%
Conservative to Moderate	30%	60%	10%
Moderate	40%	50%	10%
Moderate to Aggressive	70%	25%	5%
Aggressive	80%	10%	10%