RiskAversionQuestionnaire

RiskAversionQuestionnaire - Risk Aversion Questionnaire...

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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?
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RiskAversionQuestionnaire - Risk Aversion Questionnaire...

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