RPQ — Level Up Wealth

About This Questionnaire

This questionnaire is designed to measure your risk tolerance — an input used in determining your risk profile and appropriate investment strategy.

Risk tolerance is a measure of your attitudes and perceptions towards the uncertainties associated with investing.

A risk-averse investor is less willing to accept risk of loss and is therefore comfortable with lower returns on their investment; and conversely
An investor with high risk-tolerance is willing to accept greater risk of loss in exchange for potentially higher investment returns.

Risk tolerance is only one part of the broader financial planning process. Your financial planner will determine the most appropriate portfolio based on your ability to take risk (i.e. risk capacity), financial objectives, financial situation and particular financial needs, while taking the outputs from this questionnaire into account.

This questionnaire does not consider your capacity to take risk, financial objectives, financial situation or specific financial needs.

Client Details

Client 1

First Name

Last Name

Client 2 (optional)

First Name

Last Name

Risk Aversion Questions

1 Any investment requires taking some level of risk. There are going to be times when the value of your investment rises and falls. Over the next year, is there an amount you cannot afford to have fall in value? For example, you may require funds to make a purchase or payment.

A. No

B. Yes

If yes, please specify the amount:

Please select an answer.

2 The chart shows the potential one-year performance of five investment portfolios. The green bars show the potential gains, while the lighter bars show the potential loss each portfolio could experience.

Note — Actual portfolio outcomes could fall outside these ranges

+11%

+15%

+22%

+30%

+37%

-6.5%

-9.5%

-15%

-21%

-27%

A B C D E

Potential gain

Potential loss

Please select an answer.

3 Investment markets go up and down. If your diversified investment portfolio fell by 20% over a short period, how would you react?

A. I would not change my portfolio.

B. I would wait at least one year before changing to options that are more conservative.

C. I would wait at least three months before changing to options that are more conservative.

D. I would immediately change to options that are more conservative.

Please select an answer.

4 For many investors, the possibility of losing money is a key concern. How do you feel about investment losses?

A. Investment losses make me very uncomfortable. I check my investments often, so I can sell quickly if they begin to lose money.

B. Investment losses make me uncomfortable, but not uncomfortable enough to sell immediately. If losses occur over several months, I would probably sell.

C. Investment losses in the short-term do not bother me. I would wait an entire year before making changes.

D. I understand that investments can have losses, but also that I have a better chance of reaching my investment goals by sticking to the strategy over the long term. I would not make changes.

Please select an answer.

5 Which of the following choices best reflects your attitude toward inflation and risk? Inflation is an economic situation in which the general price of goods and services increases resulting in the same dollar buying less goods and services than before.

A. My main goal is to avoid loss, even though I may only keep pace with inflation.

B. My main goal is to earn slightly more than inflation, while taking on a low level of risk.

C. My main goal is to increase investment returns and can accept short-term losses. However, I am not comfortable with the larger losses and performance shifts that may be experienced with the most aggressive investments.

D. My main goal is to maximise investment returns, and will accept the larger potential losses and performance shifts (especially in the short-term) that can be associated with pursuing higher returns.

Please select an answer.

6 Most investments go up and down. If your portfolio incurred a loss during one year, when would you sell down your portfolio?

A. Only if the investment loses 10%.

B. Only if the investment loses 15%.

C. Only if the investment loses 20%.

D. Only if the investment loses 25%.

E. I would not sell despite any loss.

Please select an answer.

7 Investing involves a trade-off between return and risk. Investments with higher returns generally have higher risk (i.e. chance of loss). Investments with lower returns generally have lower risk or chance of loss. Which of the following statements best describes your attitude to risk?

A. I am willing to accept lower long term returns to limit my chance of loss.

B. I am willing to bear some risk and chance for loss to achieve higher returns, but prefer most of my portfolio to be invested in investments with low return/risk.

C. I am willing to accept moderate risk to achieve higher returns. Minimising risk and maximising return are equally important to me.

D. I am willing to accept high risk to achieve high returns on my investments.

E. I am only concerned with maximising investment returns. I am not concerned with risk or loss and will accept significant short-term fluctuations in my portfolio.

Please select an answer.

8 The table presents the hypothetical value of five sample portfolios after one year. The investment is $100,000 at the beginning of the year. The table shows three return scenarios: very strong, average, and very poor.

Portfolio	Very Strong ($)	Average ($)	Very Poor ($)
Portfolio 1	137,000	107,000	73,000
Portfolio 2	129,500	106,250	79,000
Portfolio 3	122,000	105,500	85,000
Portfolio 4	115,000	104,650	90,500
Portfolio 5	111,000	104,000	93,500

Note – Actual portfolio outcomes are likely to vary.

Please select an answer.

Risk Profile Results

Custom Risk Profile

If you wish to deviate from the suggested risk profile, enter your preferred profile and clearly document the reason below. Completing this section is optional.

Client 1

Custom Risk Profile

Basis for Custom Risk Profile

Risk Profile Descriptions

Profile	Growth %	Defensive %	Description
Conservative	15%	85%	The Conservative risk profile is designed for investors with a minimum two-year timeframe or those that seek a portfolio invested predominantly in interest bearing assets, with a small proportion of growth assets. This portfolio also suits investors who give a high priority to the preservation of capital (while understanding loss is still possible) and are therefore willing to accept lower potential investment performance, hence the 85 percent exposure to defensive assets (cash and fixed interest).
Moderate	30%	70%	The Moderate risk profile is designed for investors with a minimum three-year timeframe or those who seek a diversified portfolio of interest bearing and growth asset classes, with an emphasis on interest bearing assets. This portfolio also suits investors seeking a lower level of investment value volatility, and therefore willing to accept lower potential investment performance, hence the 70 percent exposure to defensive assets (cash and fixed interest).
Balanced	50%	50%	The Balanced risk profile is designed for investors with a minimum five-year timeframe. This portfolio also suits investors who desire a modest level of capital stability but are willing to accept moderate investment value volatility in return for commensurate potential investment performance, hence the 50 percent exposure to growth assets (shares, listed property and infrastructure) and 50 percent exposure to defensive assets (cash and fixed interest).
Growth	70%	30%	The Growth risk profile is designed for investors with a minimum seven-year timeframe or those who are willing to accept higher levels of investment value volatility compared to more defensive options in return for higher potential investment performance. Some exposure to interest bearing assets is still desired, but the primary concern is a higher return, hence the 70 percent exposure to growth assets (shares, listed property and infrastructure).
Aggressive	90%	10%	The Aggressive risk profile is designed for investors with a minimum nine-year timeframe or those who are willing to accept high levels of investment value volatility in return for high potential investment performance. The 90 percent exposure to growth assets (shares, listed property and infrastructure) means that capital stability is not a consideration.

Risk Profile and Client Acknowledgement

Client 1: Suggested Risk Profile

Client Acknowledgment and Declaration

I/we acknowledge the suggested risk profile noted above has been generated from the answers I/we provided to questions asked in this risk tolerance questionnaire. I/we declare that the answers provided are true and accurate to the best of my/our knowledge. Or if this is a custom profile I/we acknowledge the stated basis for change.

I/we understand that this questionnaire does not consider my/our risk capacity, financial objectives, financial situation or particular financial needs and the suggested risk profile is itself insufficient information to determine the most appropriate portfolio for my/our financial objectives, financial situation and particular financial needs.

Client 1

Signature

Date of Completion

Adviser Acknowledgement and Declaration

I declare that the suggested risk profile noted above has been determined by me based on the answers provided by the client to this risk tolerance questionnaire. Or if this is a custom profile I acknowledge the stated basis for change.

I understand that this risk tolerance questionnaire does not consider the client's risk capacity, financial objectives, financial situation or particular financial needs and the suggested risk profile is itself insufficient information to determine the most appropriate portfolio for the client's financial objectives, financial situation and particular financial needs.

Adviser

Signature

Date of Completion

This questionnaire is for general use only and does not consider risk capacity, financial objectives, financial situation or specific financial needs. The suggested risk profile is itself insufficient information to determine the most appropriate portfolio.