While we believe that our value-focused investing approach can help to avoid long-term losses, any portfolio has its shorter-term ups and downs. Those can be hard to endure when in the moment. Investors can get into a lot of trouble if they focus only on potential gains while unaware of and unprepared for how much volatility might need to be tolerated along the way.
We put a lot of emphasis on this area at PCA. In collaboration with each client, we use industry-leading software to determine the right balance between the likely long-term return and the degree of shorter-term volatility that will likely be experienced for a given portfolio. Once we’ve got a handle on growth goals and risk tolerance, we place each client in an individual portfolio that is aligned with those preferences. Then, on an ongoing basis, we use our software to continually monitor the portfolio to ensure it remains in line with the risk parameters we set.
Our risk assessment process really helps clients to pinpoint where they belong on the risk-vs.-reward spectrum, which provides an added sense of comfort to the investing experience and helps prevent damaging emotional decisions.
This video walks through the process in more detail:
If you’d like a no-cost, no-obligation risk analysis of your portfolio, just click the button below to get started with a brief quiz about your risk tolerance. Once you’ve completed the quiz, we’ll get in touch to help you see how well your current portfolio squares up with your personal risk score.
