Once an individual has completed a survey, an overall score is provided, which reflects that investor's capacity to take risk. An asset allocation of stocks and bonds with a risk exposure that properly matches the individual's risk capacity is also recommended.
Higher scores signify a higher capacity for risk, a longer time horizon and an ability to withstand market volatility. Investors with higher scores are generally recommended to hold portfolios with a larger allocation of global stocks. In contrast, lower scores signify a lower risk capacity and a higher need for liquidity. Investors with lower scores are steered toward more conservative portfolios that hold a higher proportion of short-term investments such as fixed income.