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I went today to the investment firm recommended by my brother (they deal only with physicians and the families of physicians) to invest the lion's share of my inheritance ... before I blow it all at Big Box Bookstore. 
The investment counsellor (IC) asked me to fill out a very short questionnaire to find out what type of investor I am: VERY low risk, low risk, moderate risk, high risk, or let's-run-over-the-edge-of-this-cliff-and-see-what-happens.
I consider myself to be, at best, a moderate-risk investor. I'm not prepared to go any higher than that because I don't have a lot of money to lose. ("A return of 150%, you say? Okay. Can I chip in $100?")
And my responses to the questions pretty much bore that out ... until I hit the question: "How much would your stocks have to drop before you became uncomfortable?"
I ticked off 50%.
IC:
"Um ... is this right?"
I didn't have the heart to tell him that I don't really follow my investments once they're made. To my brother's mild horror, I tend to hand over my cash and go "Here you go, invest it!" and then wander off and not think about it again. (I'm going to try to change that now ...)
I'm also aware that the stock market is like and roller coaster ... and that currently it is waaaaay up there, and of course what goes up must come down ... possibly with a resounding crash.
Anyway, I'm still tagged as "moderate" and the current investments he's making for me are actually in the upper end of the "low-risk" field, so it's all good.
The investment counsellor (IC) asked me to fill out a very short questionnaire to find out what type of investor I am: VERY low risk, low risk, moderate risk, high risk, or let's-run-over-the-edge-of-this-cliff-and-see-what-happens.
I consider myself to be, at best, a moderate-risk investor. I'm not prepared to go any higher than that because I don't have a lot of money to lose. ("A return of 150%, you say? Okay. Can I chip in $100?")
And my responses to the questions pretty much bore that out ... until I hit the question: "How much would your stocks have to drop before you became uncomfortable?"
I ticked off 50%.
IC:
"Um ... is this right?"I didn't have the heart to tell him that I don't really follow my investments once they're made. To my brother's mild horror, I tend to hand over my cash and go "Here you go, invest it!" and then wander off and not think about it again. (I'm going to try to change that now ...)
I'm also aware that the stock market is like and roller coaster ... and that currently it is waaaaay up there, and of course what goes up must come down ... possibly with a resounding crash.
Anyway, I'm still tagged as "moderate" and the current investments he's making for me are actually in the upper end of the "low-risk" field, so it's all good.