By now you should have already completed a full fact-find, to help identify your investment goals and priorities. We should have established that you are prepared to take some degree of investment risk to achieve your goals. If you do not wish to expose your capital to any risk, then you should consult us regarding alternative savings opportunities such as Cash Deposits and National Savings.

The next important step is to understand your attitude to investment risk. While there are a number of different risks that we will account for, most people understand investment risk as the likelihood and extent of a fall in the value of their investment.

The tendency for investments to rise or fall in value is known as 'volatility'. Volatility is the opposite of stability. The more volatile an investment, the more extreme the rises and falls in its value. This means there is more chance of extreme losses, but also potentially higher gains. Lower volatility means greater stability and less chance of an extreme fall in price, but also less chance of higher gains. However, the longer you hold an investment, the lower the impact of that volatility. Helping you find a portfolio that reflects a comfortable balance between potential gains and falls in value, requires finding your risk 'benchmark'. We will discuss this in detail with you in relation to your specific goals; for example how would you feel if your goal was not achieved?

To help ascertain your risk 'benchmark' please complete this questionnaire, ensuring all questions are answered. Remember that when considering different investment goals (eg school fees versus saving for retirement), you might answer the questions differently so please ensure that your answers relate to the particular investment in question only.

The resulting benchmark risk score will be between 1 and 10, with 1 being the most stable and 10 being the most volatile. A risk score of 1 will result in a portfolio consisting mostly of cash, while a risk score of 10 will indicate a portfolio very heavily weighted in shares. Scores between 1 and 10 will feature a broader mix of asset types.

The risk profile assessment is simply a guide based on information provided. We will explain what your risk benchmark score means in terms of potential gains and losses and help you decide whether to maintain, increase or decrease the risk level in the light of your particular investment goals and your full personal circumstances.

1. Personal Details

Applicant 1
Title:
First Name:
Middle Name:
Surname:
Date of Birth:

2. Risk Profile Questions

1. How long before you expect to start taking retirement income? This time period is very important in the risk assessment process.

2. Do you have an emergency fund to provide for unexpected expenses, to avoid needing to draw on medium to long-term savings to meet immediate needs? (You should allow the equivalent of at least three months net income for emergencies.)

No
Yes - but less than three months' salary
Less than 6 months' salary
Around one years' salary
More than two years' salary

3. What is your expectation of your future earnings up to retirement?

I expect my earnings to decrease
I expect my earnings to keep pace with inflation
I expect my earnings to increase somewhat ahead of inflation
I expect my earnings to far outstrip inflation
I expect to retire shortly

4. What percentage of your total assets (excluding your home) are you proposing to invest now?

Less than 25%
25% to less than 50%
50% to less than 75%
75% or more

5. Which statement most closely reflects your current financial situation?

I am completely debt free
I have no mortgage but have a few other obligations like credit card payments
I have a mortgage but no other debts that concern me
I have a mortgage and some short-term obligations
I have a lot of long-term obligations

6. Which statement best describes your objectives for this investment?

Stability is more important than higher returns
I want to achieve higher long-term returns than cash. I could cope with infrequent periods where my investments might fall in value
I want to achieve higher medium-term returns than inflation. I understand there may be occasional extended periods where my investments might fall in value
I want the best long-term returns I can get. I fully expect periods where the value of my investments might suffer extended falls

7. At the beginning of the year you have £100,000 invested. The chart and options below show the performance of four possible investments. Each bar gives a range of possible values at the end of the same year. Which investment would you prefer?

Potential best and worst case end values

This chart is for illustrative purposes only and does not reflect the performance of a specific index or fund.

Portfolio A: It could be worth anywhere between £93,000 and £113,000
Portfolio B: It could be worth anywhere between £85,000 and £125,000
Portfolio C: It could be worth anywhere between £77,000 and £137,000
Portfolio D: It could be worth anywhere between £69,000 and £149,000

8. What level of fall in the value of this portfolio over a one-year period would concern you, bearing in mind that investment in shares requires a long-term view?

More than 5%
More than 10%
More than 15%
More than 20%
I am not concerned about falls in value as I expect to recover any falls by the time I need to sell my portfolio

9. Suppose one year ago you invested £100,000 in a portfolio. Today you've checked its value and find it is now worth £87,000. How would you feel?

Panic - I'd want to sell, and invest the proceeds in Cash
Nervous - I'd want to sell part of the portfolio, and invest the proceeds in a less volatile investment
Patient - I'd sit tight, expecting the portfolio to recover
Positive - If I had any more money I'd invest it in the same portfolio

10. You are more concerned that your investments grow faster than inflation, than you are about returns over any one-year period.

Strongly agree
Agree
Disagree
Strongly disagree

11. If you were advised that your current fund and future savings are not sufficient to meet your retirement goals, what action would you take?

Take more risk with all of the money to try to improve returns
Take more risk with half of the money and increase your savings
Increase savings sufficiently to achieve your goals
Amend your goals and make no change to the investment risk or savings levels

12. What is your attitude towards purchasing an annuity* to provide income in your retirement?

My preferred option to any other form of retirement income
I would only buy an annuity if the terms were attractive compared with other options
I would not consider an annuity unless forced by circumstances at the time

13. Which of the following statements best describes your other retirement provisions?

I expect to receive state pension benefits
In addition to the state pension, I have a personal/company pension but together they are unlikely to satisfy my basic retirement needs
In addition to the state pension, I have a personal/company pension and together they will cover my basic retirement needs
I have sufficient pension and other savings to provide an income equivalent to two-thirds of my anticipated pre-retirement salary

* Annuity - This is the contract you purchase from an annuity provider using a lump sum of money (eg proceeds of your pension fund) to guarantee you an annual income for life or a period of time.

3. Your Investment Objectives

Is there a target amount you wish to achieve? If so, what is it? This is the total amount at retirement required to provide an income and any tax-free cash. In deciding upon your target, please allow for the effects of inflation, investment risk and your tax position

What is your expected retirement age?

4. Signature

We will input your answers to the Risk Profile Questionnaire into the Risk Profiler which will compute a suggested risk score and asset allocation. The risk score gives an indication of the level of risk you may be prepared to take with this investment on a range from 1 (low risk) to 10 (high risk).

As mentioned earlier, the risk score is only a guide, and you can decide, with our help, to invest more conservatively or more aggressively.

If you are happy with your answers and you agree to us using the information as stated in the above paragraph, please type I AGREE in the box below and submit the form.