RiskAversionQuestionnaire

RiskAversionQuestionnaire - Risk Aversion...

Info icon This preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
1 Risk Aversion Questionnaire (taken from The Wall Street Journal 1998) Circle the letter that corresponds to your answer 1. Just 60 days after you put money into an investment, its price falls 20%. Assuming none of the fundamentals have changed, what would you do? a. Sell to avoid further worry and try something else b. Do nothing and wait for the investment to come back c. Buy more. It was a good investment before; now it’s a cheap investment too 2. Now look at the previous question another way. Your investment fell 20%, but it’s part of a portfolio being used to meet investment goals with three different time horizons. 2A. What would you do if the goal were five years away? a. Sell b. Do nothing c. Buy more 2B. What would you do if the goal were 15 years away? a. Sell b. Do nothing c. Buy more 2C. What would you do if the goal were 30 years away? a. Sell b. Do nothing c. Buy more 3. The price of your retirement investment jumps 25% a month after you buy it. Again, the fundamentals have not changed. After you finish gloating, what do you do?
Image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

{[ snackBarMessage ]}

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern