The Concept Of Risk Tolerance In Investments

Risk tolerance is an important factor in developing a retirement plan. Matt Dixon, a Registered Financial Consultant, works with clients in and around Greenville, SC, to determine their risk aversion and risk tolerance when developing a retirement and investment plan.

Matt Dixon understands that the investment strategy must be comfortable for his clients. As retirement planning is a long-term investment strategy, it is essential for the investor to have confidence in the plan and understand the level of risk and the ability to reach their personal investment goals.

Risk Aversion

Most investors have some level of risk aversion. Think of this as the fear of losing capital and the aversion to investing in higher risk asset categories. While some level of risk aversion is both healthy and effective in preventing poor investment decisions, it also reduces the possibility of investing in higher return options.

Risk Tolerance

Working with Matt Dixon allows a customized approach to investing that offers options for higher returns on investment while reducing the fear of taking a risk. Through education and understanding, clients in Greenville, SC, can diversify their investment portfolio, providing some level of risk in potentially higher return assets while maintaining a low-risk base to provide stability and security.

This combination of risk tolerance and investment earning potential provides the ideal option for most investors. Over time, assets can be shifted from higher risk to lower risk investments, creating greater stability as the investor gets closer to retirement.

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