Finance Quiz - Types Of Investors And Risk Profile

10 Questions | Attempts: 110

Finance Quiz - Types Of Investors And Risk Profile - Quiz

What do you know about risk profiles? A risk profile is an evaluation of an individual's willingness and ability to take risks. It can also refer to the threats to which an organization is exposed. A risk profile is important for determining a proper investment asset allocation for a portfolio. Know more about risk profiles and types of investors in this finance Quiz!


You May Get

Passive Investor with Low Risk Tolerance

Your type is a Passive Investor with Low-Risk Tolerance. A Passive Investor does not participate in the day-to-day decisions of running a company. The passive investor is the one who assumes the market is efficient. Moreover, they believe that the pricing of stocks is correct and reflects the risks involved. A passive investor works with the aid of management and stakeholders to increase its value and to share the true potential with the passive investor. Passive investing broadly refers to a buy-and-hold portfolio strategy for long-term investment horizons, with minimal trading in the market. Passive investment is cheaper, less complex, and often produces superior after-tax results over medium to long time horizons than actively managed portfolios. If an investor is passive and the risk tolerance reveals low-risk tolerance then you are likely to be a Passive Preserver.

Active Investor with Medium Risk Tolerance

Your type is Active Investor with Medium Risk Tolerance. An active investor engages in an investing strategy that involves buying and selling securities and other types of investments. Active investors continuously monitor their investments and market conditions to identify new profit opportunities. As opposed to passive investors, active investors are heavily involved in the market and managing their investments. Active investors have embraced full responsibility for their financial future by not only building investment capital as passive investors, but also taking responsibility for the return on their invested capital through active strategies that add value. If an investor is active and the risk tolerance reveals medium risk tolerance then you are likely to be a Individual Independent.
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Questions and Answers
  • 1. 
    Have you earned the majority of your wealth in your lifetime?
    • A. 

      Yes

    • B. 

      No

  • 2. 
    Have you risked your own capital in the creation of your wealth?
    • A. 

      Yes

    • B. 

      No

  • 3. 
    Which is stronger: your tolerance for risk to build wealth or the desire to preserve wealth?
    • A. 

      Tolerance for risk

    • B. 

      Preserve wealth

  • 4. 
    Would you prefer to maintain a degree of control over your investments or prefer to delegate that responsibility to someone else?
    • A. 

      Maintain control

    • B. 

      Delegate

  • 5. 
    Do you have faith in your abilities as an investor?
    • A. 

      Yes

    • B. 

      No

  • 6. 
    If you have to pick one of two portfolios, which would it be?
    • A. 

      80% stocks; 20% bonds

    • B. 

      40% stocks; 60% bonds

  • 7. 
    Is your wealth goal intended to continue your current lifestyle or are you motivated to build wealth at the expense of current lifestyle?
    • A. 

      Build wealth

    • B. 

      Continue current lifestyle

  • 8. 
    In your work of personal life, are you generally self starter in that you seek out what needs to be done and then do it , or do you normally take direction?
    • A. 

      Self starter

    • B. 

      Take direction

  • 9. 
    Are you "income motivated"  or are you willing to put your capital at risk to build wealth?
    • A. 

      Capital at risk

    • B. 

      Income motivated

  • 10. 
    Do you believe in the concept of borrowing money to make money / operate business or do you prefer to limit the amount of debt you owe?
    • A. 

      Borrow money

    • B. 

      Limit debt

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