There are many ways to view or assess risk. Risk means different things to different people. When we first meet new clients, often the word “risk” is synonymous with “loss” or the chance of losing money.
For us at Concierge Wealth Management, as financial planners, we seek to separate the concept of risk from loss. To us, risk is an assessment of predictability – how narrow the range of potential outcomes. Through life, we sometimes need things to be predictable. At other times, we can accept a greater range of potential outcomes, during a given year or for a particular period. This is effectively our willing to accept risk.
This is best explained by example. In saving for retirement, during our younger years, maybe during our twenties and thirties, we can afford risk as we are not relying on a given return from investing year on year. As we get older, the return needs to be more predictable, especially during the years immediately preceding reliance on the fund.
In every aspect of life, we accept risk daily. A range of potential outcomes. With each and all decisions we make. In financial planning terms, our job is to help you assess your acceptable range of outcomes and help plan and manage them effectively.
We have a risk assessment questionnaire built on a detailed and sophisticated risk modelling process designed by Oxford Risk. You can download a copy of the questionnaire here. This will allow us to build you a risk report highlighting your goals and agreed risk corridor for each individual priority highlighted through the advice process.
Aside from our careful risk screening processes, we also have proprietary systems that will keep a sharp eye on the volatility (a mathematical measure of risk) and ensure your investments and savings stay as predictable as you expect them to be. Obviously, we cannot control markets, but we can assist your understanding of the underlying assets you hold in your investments and keep you informed about the suitability of your arrangements over time.