I’m Keith DeGreen and this is your Investors Minute

When I interview all potential clients, my first priority is to match their investment expectations with their real risk tolerance. It’s harder than you think!

A leading commentator, CFA David Merkel, recently shared some thoughtful insights regarding risk.

David points out that risk and return are often described in the same breath, and that most people think of them as being closely correlated to each other. In fact, the relationship is not linear, and in fact there are many types of risk.

Purchasing power risk, for example, is the risk of not being able to maintain your lifestyle indefinitely; while market risk is the risk of suffering downward fluctuations in the value of your investments along the way.

That’s why it’s important to examine all the risks – and your real risk tolerance — before you invest.

FEE-ONLY DeGreen Capital Management. Pioneers in low-cost exchange-traded fund investing. Irvine: 949-333-4550. Scottsdale: 480-609-9900. www.DeGreen.com. Minimum portfolio requirement $1,000,000.

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