News & Updates

Most attempts to measure risk tolerance fail in at least one crucial way, be it confusing the measurement, confusing the audience, or thinking guesswork is a good enough replacement for rigorous psychometric science.

Investment plans that ignore, or pay only the whisper of lip service, to investor behaviours, are ultimately futile. Ultimately, the true job of a financial adviser is not to give clients a theoretically 'optimal' solution, but to give them the best solution they could realise in practice.

Increased complexity is a cost that the new benefits need to justify. What are the costs and benefits of your cost-benefit analysis? Too often, cashflow modelling introduces additional costs for little to no additional benefit.

If you start with high risk capacity, then after a fall in the markets your capacity gets even higher. If you start with low capacity, then lower market values means an even lower capacity.

Risk is not about the journey; it's about where you could end up. It is the risk of money not being there when it's needed, reflecting both the chance and the severity of poor returns.

A focus on the boxes to be ticked rather than the reasons the boxes exist can lead to laws being followed at the expense of meeting the very outputs the laws are there to produce.

If the risk that you're willing and able to take is not enough to get you to your goals, then any use of 'risk required' implies taking more risk than you're either able or willing to do.

Linking investor and investment risk requires putting the two into the same language; common approaches to doing this are not fit for purpose.There cannot be a perfect empirical way of mapping investor risk to investment risk.

The biggest barrier to social impact investing is low awareness of its opportunities to align investment goals with social goals. Some investors prefer to consciously trade-off social good and financial outcomes, thereby 'buying' the maximum social good with their wealth.