Risk profiles
We have created 10 client risk profiles, which range from Defensive to Speculative:
1 – Defensive
Defensive investors tend to target capital preservation. Their investments will typically be deposit-based but with some exposure to risk assets in order to provide the potential for maintaining capital at or above inflation.
2 – Very cautious
Very cautious investors tend to target a return above deposit rates while aiming to provide some capital preservation. Their investments will typically be in deposit and fixed interest based assets, with a small exposure to risk assets.
3 – Cautious
Cautious investors tend to target a modest level of growth via a portfolio of mixed assets. Their portfolios will primarily be invested in fixed interest assets but also defensive equity and property so as to achieve relatively stable long-term returns. In the short-term, they typically expect some volatility.
4 – Cautious balanced
Cautious balanced investors tend to target a moderate level of capital appreciation by investing in a multi-asset portfolio. Their investments will be mainly in UK fixed interest securities, equities – in particular UK equities – and property. They typically expect a moderate amount of volatility.
5 – Balanced
Balanced investors tend to target longer-term capital growth. Their investments will be mainly in fixed interest, equities with a UK focus and also some ‘alternative’ asset classes, mostly property. They typically expect some volatility in return for the possibility of higher long-term returns.
6 – Balanced growth
Balanced growth investors tend to target a return using a portfolio with a higher equity content and a wider geographical spread. Their investments will be predominantly in UK and overseas equities, with an exposure to fixed interest and property in order to provide growth orientated diversification. They typically accept some volatility in return for the possibility of higher long-term returns.
7 – Growth
Growth investors tend to target long-term capital growth by adopting a higher risk level. Their investments will typically be in UK and overseas equities, but also some ‘alternative’ asset classes, for the purpose of achieving long-term capital appreciation.
8 – Adventurous
Adventurous investors tend to target higher capital appreciation by adopting higher levels of risk. Their investments will typically be in equities and some alternative assets.
9 – Aggressive
Aggressive investors tend to target a high level of capital appreciation by investing in high risk assets. Their investments will be largely in overseas equities and alternative assets. They typically expect a wide range of volatility in order to achieve high capital appreciation.
10 – Speculative
Speculative investors tend to target a very high level of capital appreciation within a wide volatility range, often as a result of less regard to investment issues such as political and currency risks. Their investments will be in risk assets, spread globally and frequently with no UK exposure. They typically expect a very high degree of shorter-term volatility.