BT Risk Profiler
The BT Risk Profiler draws different factors together by helping you understand
how you feel about risk. It provides guidelines that may help you determine
how to allocate the funds you have available for investing among the major
asset classes (i.e. shares, property, fixed interest and cash).
When answering the following questions, keep in mind that with superannuation-type investments in most cases you will not have access to your money until you retire.
Select the most suitable answer for each of the following questions or statements -
Balanced investment
Your responses suggest you are a medium to long-term investor who is not concerned about investment income* or the stability of your investment in the short-term. You want your portfolio to increase in value over four to five years even if in the short-term the value of the portfolio falls.
* Note: superannuation does not provide income until you retire.
Investments
The portfolio recommended for this profile is 70% invested in growth assets such as Australian and international shares and property trusts, with the remainder in defensive assets such as fixed interest and cash. The growth assets provide reasonable growth for the portfolio while the defensive assets provide modest income.
| Features | |
|---|---|
| Suggested minimum timeframe for investment | Four to five years |
| Short-term risk | High |
| Return objective (relative to other investment strategies) | High |
This portfolio could be achieved by either:
- a single investment that incorporates the asset mix
or - separate investments that replicate the mix when grouped together.
Conservative investment
Your responses suggest you are a short to medium-term investor seeking income* from your investments, stability of your initial funds invested and are not too concerned about increasing the value of your initial investment.
* Note: superannuation does not provide income until you retire.
Investments
The portfolio recommended for this profile is 30% invested in growth assets such as Australian and international shares and property trusts, with the remainder in defensive assets such as fixed interest and cash. The growth assets provide some hedge against inflation while the defensive assets provide income.
| Features | |
|---|---|
| Suggested minimum timeframe for investment | Two to three years |
| Short-term risk | Low to moderate |
| Return objective (relative to other investment strategies) | Low to moderate |
This portfolio could be achieved by either:
- a single investment that incorporates the asset mix
or - separate investments that replicate the mix when grouped together.
Growth investment
Your responses suggest you are a medium to long-term investor who wants your portfolio to show good growth over five years even if in the short-term the value of your portfolio falls. Investment income is not an issue for you.
Investments
The portfolio recommended for this profile is 86% invested in growth assets such as Australian and international shares and property trusts, with the remainder in defensive assets such as fixed interest and cash. The growth assets provide good growth for the portfolio while the defensive assets provide liquidity for a small amount of the portfolio.
| Features | |
|---|---|
| Suggested minimum timeframe for investment | Four to five years |
| Short-term risk | High |
| Return objective (relative to other investment strategies) | High |
This portfolio could be achieved by either:
- a single investment that incorporates the asset mix
or - separate investments that replicate the mix when grouped together.
high growth investment
Your responses suggest you are a long-term investor who is not concerned about investment income* or the stability of your investment in the short-term. You want your portfolio to increase in value over five to seven years even if in the short-term the value of the portfolio falls.
* Note: superannuation does not provide income until you retire.
Investments
The portfolio recommended for this profile is fully invested in growth assets such as Australian and international shares and property trusts.
| Features | |
|---|---|
| Suggested minimum timeframe for investment | Five to seven years |
| Short-term risk | Very high |
| Return objective (relative to other investment strategies) | Very high |
This portfolio could be achieved by either:
- a single investment that incorporates the asset mix
or - separate investments that replicate the mix when grouped together.
Moderate investment
Your responses suggest you are a medium term investor seeking income* from your investments and stability of your initial funds invested. At the same time you want the potential for some increase in the value of your portfolio.
* Note: superannuation does not provide income until you retire.
Investments
The portfolio recommended for this profile is 52% invested in growth assets such as Australian and international shares and property trusts, with the remainder in defensive assets such as fixed interest and cash. The growth assets provide moderate growth for the portfolio while the defensive assets provide income.
| Features | |
|---|---|
| Suggested minimum timeframe for investment | Three to five years |
| Short-term risk | Moderate |
| Return objective (relative to other investment strategies) | Moderate |
This portfolio could be achieved by either:
- a single investment that incorporates the asset mix
or - separate investments that replicate the mix when grouped together.
Short term investment
Your responses suggest you are a short-term investor who is very concerned about the stability of your initial funds invested. You may be willing to take lower returns so long as your initial funds invested are preserved. You may also be seeking to park your funds in the short-term while deciding which other profile to invest in. After taking into account the impact of inflation, returns might be negative.
Investments
The portfolio recommended for this profile is invested fully in cash and similar securities.| Features | |
|---|---|
| Suggested minimum timeframe for investment | No minimum; the maximum should be less than 12 months |
| Short-term risk | Low |
| Return objective (relative to other investment strategies) | Low |
When it comes to investing, we all have different attitudes towards risk. Whether investing in shares, property, fixed interest or cash you should carefully consider the level of risk involved in each investment and how you feel about that risk. For instance, you should consider how comfortable you are with the possibility of losing money or that the returns on your investments could fluctuate widely from year to year.
It will:
- Help you understand how you feel about risk
- Provide an illustration of how, given a particular risk profile, you could choose to allocate the money you have available for investment between the various general asset classes (i.e. shares, property, fixed interest and cash).
What is a Risk Profiler?
One of the keys to successful investing is knowing yourself, knowing what you want to achieve and when you want to achieve it.
Another key to investing is understanding the fundamental risk and return relationship - that the more risk you take, the higher your returns are likely to be in the long term. And the higher the long-term returns, the more volatility you may have to endure in the short term.
The BT Risk Profiler draws these factors together by helping you understand how you feel about risk. It provides guidelines that may help you determine how to allocate the funds you have available for investing among the major asset classes (i.e. shares, property, fixed interest and cash).
What Risk Profilers do and don't do
A risk profiler is a tool that can assist you clarify your understanding of your tolerance to risk.
It does not provide you with financial advice about any particular financial product or class of financial product. Rather, it gives you an insight about how people with certain risk profiles may choose to allocate their funds available for investing among the major asset classes.
The calculations you are able to carry out using the Risk Profiler are for general illustration purposes only, based on the limited inputs you have given and assumptions built into the calculator. A risk profiler is not a substitute for a detailed financial plan. A risk profiler does not take into account all your individual investment objectives, existing financial situation or particular needs, nor does it help you to select financial products or strategies that suit your needs and your risk-return preferences. All these should be considered before making any investment decision.
You should also consider whether the results of the Risk Profiler are appropriate, bearing in mind all aspects of your individual financial situation. This may include existing financial commitments and other financial assets you own. To the extent that this risk profiler does contain general advice, you should read the relevant Financial Services Guides (FSGs) for the BT Financial Group. For a copy, simply click on the Disclosure Documents link at the bottom of this page and refer to your area of interest - "Investments", "Superannuation", "Margin Lending" or "Wrap".
The importance of obtaining professional advice
Before making any investment decision, we recommend that you speak with a financial adviser who can make a detailed assessment of your financial situation, help you define your investment goals, and select financial products and strategies that suit your risk and return preferences.
