Understanding Risk Tolerance

What is risk tolerance primarily about?

• The amount of money one has

• The ability to climb rocks

• Comfort with taking risks

• The number of investments one owns

Which of the following is an example of a high-risk investment?

• Savings account

• Government bonds

• Certificate of Deposit (CD)

• Meme stocks

What might someone with low risk tolerance prefer?

• Investing in tech stocks

• Buying cryptocurrency

• Keeping money in a savings account

• Trading meme stocks

How can risk tolerance change over time?

• It can increase when one is younger

• It only changes after retirement

• It decreases as one gains more experience

• It remains constant throughout life

What is the key takeaway about risk tolerance?

• It is important to follow others' risk tolerance levels

• There is a universally correct level of risk tolerance

• It is about understanding personal comfort and making decisions accordingly

• Risk tolerance is irrelevant in investing