Discussing Risk Tolerance and COVID-19 with Advisor's Edge (Interview)

Kellyanne Yep - May 09, 2020
In addition to portfolios suffering as markets tanked in March, clients may have lost their jobs or become ill during the pandemic. Such changes could significantly affect clients’ retirement goals, time horizons and risk tolerance if cash is needed

Is a crisis the right time to review risk tolerance?

 

By: Mark Burgess | May 8, 2020

 

In good times, advisors go to great lengths to remind clients that the party won’t last, and to tease out how clients will feel when portfolios lose 20% of their value.

 

“Complacency can set in,” says Darcie Crowe, investment advisor and portfolio manager at Canaccord Genuity Wealth Management in Vancouver, describing the “greed phase” of the market after a decade-long bull run.

 

“Investors push beyond what their true risk tolerance and comfort level is because of the fear of missing out,” she says.

 

Advisors have various methods to push back, but none as visceral as the real thing. In that sense, the economic fallout from Covid-19 presents a rare opportunity to review clients’ risk tolerance.

 

To read the full article, please visit: https://www.advisor.ca/my-practice/conversations/kyc-in-a-dangerous-time/