She writes: "As you think about your own response to risk, it’s unlikely that you will jump immediately from ecological limits to how much you should invest in stocks versus bonds versus real estate. It’s more likely that your responses fit into one or more of the following categories. You’ll notice that the risk responses below do not explicitly deal with investing, much less with traditional asset classes. Rather, they provide a way to examine your personal tendencies for dealing with risk, which is an essential precursor to forming an intelligent, risk-based investment strategy."
I agree, every time I discuss a situation with a client I do my best to assess how they feel about their response to risk.
She goes on to describe three different responses to risk: the ostrich approach, musical chairs or plan b.
Read her entire article here.
