What's Your Risk Tolerance?

Typically, risk is defined as short-term price volatility. But on a long-term basis, you can think of risk as the possibility that your accumulated assets will be insufficient to meet your financial goals. And if you want to reach your financial goals, you must start with an honest appraisal of your own personal comfort zone with regard to risk.

Individual tolerance for risk varies, creating a distinct "investment personality" for each investor. Some investors are comfortable with short-term volatility, others are not. Whether you consider your investment temperament to be conservative, moderate or aggressive, you need to focus on how comfortable or uncomfortable you will be as the value of your investment moves up or down. If you can't sleep at night for worry about the value of your mutual fund shares, you already know the type of investor you are.

Click Here To Determine What Type Of Investor You Are

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