RISK TOLERANCE QUESTIONNAIRE

In order to get a basic idea of how you view risk in the investment marketplace, please
complete the following questions, tally your points and determine where you find
yourself on the chart below. Please keep in mind that the following is just an exercise
and is not intended to be the only tool used in determining your risk tolerance. As with
any investment decision, you should discuss your options with a professional to
determine if any investment is appropriate for you.

1. What is your age?

a. 60 +
b. 51 – 60
c. 41 – 50
d. 31 – 40
e. 21 – 30

2. When do you think you will need the bulk of the money that you are investing?

a. Within the next two years

b. Between two and five years
c. Between six and nine years
d. Between ten and fifteen years
e. Over 15 years

3. Over the next few years, do you expect your annual household income to:

a. Decrease substantially
b. Decrease moderately
c. Stay the same
d. Increase moderately
e. Increase substantially

4. If you purchase an investment and if it were to decline 15% the following day, what
would you most likely do:

a. Sell the entire investment immediately to avoid further losses

b. Sell half of the investment to limit further losses
c. Hold the investment and wait until your loss is fully recovered, then sell
d. Nothing
e. Buy more of the investment because you feel you are getting it “on sale”
5. You are interested in purchasing a stock mutual fund. The one you would most likely
invest in is the following:

a. I would not invest in a stock mutual fund

b. An S&P 500 index fund which represents the numerous companies that comprise the
S&P 500 index
c. A fund of large “blue chip” companies that are well known and have proven
record of earnings
d. A fund of small, unknown companies with the potential for large returns, but a
high level of risk
e. A fund that invests exclusively in technology-related companies

6. You are interested in investing in a bond/cash mutual fund. The one you would most
likely invest in is the following:

a. A money market fund that invests in short-term, safe investments where interest is
low but there is little chance of losing principal
b. A fund of municipal bonds because your biggest concern is minimizing taxes and
you are willing to sacrifice some return for this benefit
c. A short-term bond fund where interest is slightly higher than a money market, but
principal may fluctuate from time to time
d. A long-term bond fund where interest is higher than a short-term fund, but
principal fluctuations are prone to interest rate risk and will be more volatile
e. A fund of “junk bonds” where there is risk of company default but the return
potential can be the highest of all bond funds

7. You have an opportunity to participate in an underwater salvage operation to recover

sunken treasures. You only have a 25% chance of recovering the treasure. However,
if successful, you can earn 100 times your investment. How much do you invest?

a. Nothing at all
b. One week’s salary
c. Two week’s salary
d. One month’s salary
e. Three month’s salary

8. Assume you are a contestant on a game show and you just reached the $10,000
plateau. Now you must choose between quitting with the $10,000 in hand or betting
the entire $10,000 in one of four alternative scenarios. Which do you choose:

a. The $10,000 – you take the money and run.

b. A 75% chance of winning $25,000
c. A 50% chance of winning $50,000
 d. A 25% chance of winning $75,000
e. A 10% chance of winning $100,000

9. What annual rate of return do you realistically expect on your investments?

a. 6%-7%
b. 7%-8%
c. 8%-10%
d. 10%-12%
e. Over 12%

Scoring:
Please add up your score in the following manner:

Give yourself one point for every ‘a’ answer

Give yourself two points for every ‘b’ answer
Give yourself three points for every ‘c’ answer
Give yourself four points for every ‘d’ answer
Give yourself five points for every ‘e’ answer

Add all of your points and see where you land on the following scale:

Investment Style:

Conservative Moderate Aggressive

9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45

Portfolio Style:

Defensive Income Growth & Income Growth Aggressive

Growth